EXHIBIT 10.12
MULTICURRENCY CREDIT AGREEMENT
DATED AS OF DECEMBER 17, 1999,
AMONG
ANICOM, INC.,
THE LENDERS
PARTY HERETO,
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
INDIVIDUALLY AND AS AGENT,
And
BANK ONE, NA,
individually and as Syndication Agent
TABLE OF CONTENTS
SECTION DESCRIPTION PAGE
SECTION 1. THE REVOLVING CREDITS..................................1
Section 1.1. The Revolving Credit...................................1
Section 1.2. The Revolving Notes....................................1
Section 1.3. Letters of Credit......................................2
Section 1.4. Manner and Disbursement of Revolving Loans.............5
Section 1.5. The Swing Line.........................................7
(a) Swing Loans............................................7
(b) Swing Note.............................................7
(c) Minimum Borrowing Amount...............................7
(d) Interest on Swing Loans................................7
(e) Requests for Swing Loans...............................8
(f) Refunding Loans........................................9
(g) Participations.........................................9
(h) Indemnification........................................9
Section 1.6. Extensions of the Revolving Credit Termination Date...10
Section 1.7. Maturity of Loans.....................................10
SECTION 2. INTEREST AND CHANGE IN CIRCUMSTANCES..................10
Section 2.1. Interest Rate Options on Revolving Notes..............10
Section 2.2. Minimum LIBOR Portion Amounts........................12
Section 2.3. Computation of Interest...............................12
Section 2.4. Manner of Rate Selection..............................13
Section 2.5. Change of Law.........................................13
Section 2.6. Unavailability of Deposits or Inability to Ascertain
or Inadequacy of, Fixed Rate......................14
Section 2.7. Taxes and Increased Costs.............................14
Section 2.8. Change in Capital Adequacy Requirements...............15
Section 2.9. Funding Indemnity.....................................16
Section 2.10. Lending Branch........................................16
Section 2.11. Discretion of Lenders as to Manner of Funding.........17
SECTION 3. FEES, PREPAYMENTS, TERMINATIONS, AND APPLICATIONS.....17
Section 3.1. Fees..................................................17
Section 3.2. Prepayments...........................................18
Section 3.3. Terminations..........................................20
Section 3.4. Place and Application of Payments.....................20
Section 3.5. Notations.............................................21
SECTION 4. GUARANTIES............................................22
Section 4.1. Collateral............................................22
Section 4.2. Subsidiary Guaranties.................................22
Section 4.3. Further Assurances....................................22
SECTION 5. DEFINITIONS; INTERPRETATION...........................22
Section 5.1. Definitions...........................................22
Section 5.2. Interpretation........................................39
SECTION 6. REPRESENTATIONS AND WARRANTIES........................39
Section 6.1. Organization and Qualification........................39
Section 6.2. Subsidiaries..........................................39
Section 6.3. Corporate Authority and Validity of Obligations.......40
Section 6.4. Use of Proceeds; Margin Stock.........................40
Section 6.5. Financial Reports.....................................41
Section 6.6. No Material Adverse Change............................41
Section 6.7. Full Disclosure.......................................41
Section 6.8. Good Title............................................41
Section 6.9. Litigation and Other Controversies....................41
Section 6.10. Taxes.................................................41
Section 6.11. Approvals.............................................42
Section 6.12. Affiliate Transactions................................42
Section 6.13. Investment Company; Public Utility Holding Company....42
Section 6.14. ERISA.................................................42
Section 6.15. Compliance with Laws..................................42
Section 6.16. Other Agreements......................................43
Section 6.17. No Default............................................43
Section 6.18. Year 2000 Compliance..................................43
SECTION 7. CONDITIONS PRECEDENT..................................43
Section 7.1. All Advances..........................................43
Section 7.2. Initial Advance.......................................44
Section 7.3. Termination of Existing Credit Agreements.............45
SECTION 8. COVENANTS.............................................46
Section 8.1. Corporate Existence; Subsidiaries.....................46
Section 8.2. Maintenance of Properties.............................46
Section 8.3. Taxes and Assessments.................................46
Section 8.4. Insurance.............................................46
Section 8.5. Financial Reports.....................................47
Section 8.7. Interest Coverage Ratio...............................49
Section 8.8. Tangible Net Worth....................................49
Section 8.9. Debt to Earnings Ratio................................49
Section 8.10. Leverage Ratio........................................50
Section 8.11. Indebtedness for Borrowed Money.......................50
Section 8.12. Liens.................................................50
Section 8.13. Investments, Loans, Advances and Guaranties...........51
Section 8.14. Acquisitions..........................................52
Section 8.15. Sales and Leasebacks..................................53
Section 8.16. Dividends and Certain Other Restricted Payments.......53
Section 8.17. Mergers, Consolidations and Sales.....................53
Section 8.18. ERISA.................................................54
Section 8.19. Compliance with Laws..................................54
Section 8.20. Burdensome Contracts With Affiliates..................54
Section 8.21. No Changes in Fiscal Year.............................54
Section 8.22. Inspection and Field Audit............................55
Section 8.23. Formation of Subsidiaries.............................55
Section 8.24. Subordinated Indebtedness.............................55
Section 8.25. Use of Proceeds.......................................55
Section 8.26. Year 2000 Compliance..................................56
Section 8.27. European Monetary Union...............................56
SECTION 9. EVENTS OF DEFAULT AND REMEDIES........................57
Section 9.1. Events of Default.....................................57
Section 9.2. Non-Bankruptcy Defaults...............................59
Section 9.3. Bankruptcy Defaults...................................59
Section 9.4. Collateral for Undrawn Letters of Credit..............59
SECTION 10. THE AGENT.............................................60
Section 10.1. Appointment and Authorization.........................60
Section 10.2. Rights as a Lender....................................60
Section 10.3. Standard of Care......................................60
Section 10.4. Costs and Expenses....................................61
Section 10.5. Indemnity.............................................61
SECTION 11. MISCELLANEOUS.........................................62
Section 11.1. Withholding Taxes.....................................62
Section 11.2. Non-Business Days.....................................63
Section 11.3. No Waiver, Cumulative Remedies........................63
Section 11.4. Waivers, Modifications and Amendments.................63
Section 11.5. Costs and Expenses....................................63
Section 11.6. Documentary Taxes.....................................64
Section 11.7. Survival of Representations...........................64
Section 11.8. Survival of Indemnities...............................64
Section 11.9. Participations........................................64
Section 11.10. Assignment Agreements.................................65
Section 11.11. Notices...............................................65
Section 11.12. Construction..........................................66
Section 11.13. Headings..............................................67
Section 11.14. Severability of Provisions............................67
Section 11.15 Counterparts..........................................67
Section 11.16. Entire Understanding..................................67
Section 11.17. Currency..............................................67
Section 11.18. Currency Equivalence..................................67
Section 11.19. Binding Nature, Governing Law, Etc....................68
Section 11.20. Submission to Jurisdiction; Waiver of Jury Trial......68
Signature.....................................................................69
Exhibit A-1 - Revolving Credit Note
Exhibit A-2 - Swing Line Note
Exhibit B - Compliance Certificate
Exhibit C - Subordinated Indebtedness
Exhibit D - Subordination Provisions Applicable to Subordinated Debt
Exhibit E - Form of Guaranty
Exhibit F - Borrowing Base Certificate
Schedule 1 - Commitments
Schedule 6.2 - Subsidiaries
MULTICURRENCY CREDIT AGREEMENT
To each of the Lenders party hereto:
Ladies and Gentlemen:
The undersigned, Anicom, Inc., a Delaware corporation (the "Company"),
applies to you for your several commitments, subject to the terms and conditions
hereof and on the basis of the representations and warranties hereinafter set
forth, to extend credit to the Company, all as more fully hereinafter set forth.
SECTION 1. THE REVOLVING CREDITS.
Section 1.1. The Revolving Credit. Subject to the terms and conditions
hereof, each Lender severally agrees to extend a revolving credit (the
"Revolving Credit") to the Company which may be availed of by the Company from
time to time during the period from and including the date hereof to but not
including the Revolving Credit Termination Date, at which time the commitments
of the Lenders to extend credit under the Revolving Credit shall expire. The
maximum amount of the Revolving Credit which each Lender agrees to extend to the
Company shall be as set forth opposite such Lender's signature hereto under the
heading "Revolving Credit Commitment" or as otherwise provided in Section 11.10
hereof, as such amount may be reduced pursuant hereto. The Revolving Credit may
be utilized by the Company in the form of Revolving Loans and Letters of Credit,
all as more fully hereinafter set forth, provided that (i) the aggregate
Original Dollar Amount of Loans (whether Revolving Loans or Swing Loans) and
Letters of Credit outstanding at any one time shall not exceed the lesser of (x)
the Revolving Credit Commitments and (y) the Borrowing Base as determined on the
most recent Borrowing Base Certificate and (ii) the aggregate Original Dollar
Amount of Revolving Loans and Letters of Credit and denominated in Alternative
Currencies shall not exceed $15,000,000. During the period from and including
the date hereof to but not including the Revolving Credit Termination Date, the
Company may use the Revolving Credit Commitments by borrowing, repaying and
reborrowing Revolving Loans in whole or in part and/or by having the Agent issue
Letters of Credit, having such Letters of Credit expire or otherwise terminate
without having been drawn upon or, if drawn upon, reimbursing the Agent for each
such drawing, and having the Agent issue new Letters of Credit, all in
accordance with the terms and conditions of this Agreement. For purposes of this
Agreement, where a determination of the unused or available amount of the
Revolving Credit Commitments is necessary, the Original Dollar Amount of Loans
(whether Revolving Loans or Swing Loans) outstanding and Letters of Credit shall
be deemed to utilize the Revolving Credit Commitments. The obligations of the
Lenders hereunder are several and not joint, and no Lender shall under any
circumstances be obligated to extend credit in excess of its Revolving Credit
Commitment.
Section 1.2. The Revolving Notes. Subject to the terms and conditions
hereof, the Revolving Credit may be availed of by the Company in the form of
Revolving Loans (individually a "Revolving Loan" and collectively the "Revolving
Loans") in U.S. Dollars or an Alternative Currency. Each Borrowing of Revolving
Loans under the Revolving Credit shall be made ratably by the Lenders in
accordance with their Percentages of the Revolving Credit Commitments. All
Revolving Loans made by a Lender under the Revolving Credit shall be made
against and evidenced by a single Revolving Credit Note of the Company
(individually a "Revolving Note" and collectively the "Revolving Notes") payable
to the order of such Lender in the amount of its Revolving Credit Commitment,
with each Revolving Note to be in the form (with appropriate insertions)
attached hereto as Exhibit A-1. Each Revolving Note shall be dated the date of
issuance thereof, be expressed to bear interest as set forth in Section 2
hereof, and be expressed to mature on the Revolving Credit Termination Date.
Without regard to the principal amount of each Revolving Note stated on its
face, the actual principal amount at any time outstanding and owing by the
Company on account thereof shall be the sum of all advances then or theretofore
made thereon less all payments of principal actually received.
Section 1.3. Letters of Credit.
(a) General Terms. Subject to the terms and conditions hereof, the
Revolving Credit may be availed of by the Company in the form of standby and
commercial letters of credit issued by the Agent for the account of the Company
in U.S. Dollars or an Alternative Currency (individually a "Letter of Credit"
and collectively the "Letters of Credit"), provided that (i) the aggregate
Original Dollar Amount of Letters of Credit issued and outstanding hereunder
shall not at any time exceed the lesser of (x) $20,000,000 and (y) the excess
(if any) of the Revolving Credit Commitments over the aggregate Original Dollar
Amount of Loans (including both Revolving Loans and Swing Loans) then
outstanding and (ii) the aggregate Original Dollar Amount of Revolving Loans and
Letters of Credit denominated in Alternative Currencies shall not exceed
$15,000,000. For purposes of this Agreement, a Letter of Credit shall be deemed
outstanding as of any time in an amount equal to the maximum amount which could
be drawn thereunder under any circumstances and over any period of time plus any
unreimbursed drawings then outstanding with respect thereto. If and to the
extent any Letter of Credit expires or otherwise terminates without having been
drawn upon, the availability under the Revolving Credit Commitments shall to
such extent be reinstated. The Letters of Credit shall be issued by the Agent,
but each Lender shall be obligated to reimburse the Agent for such Lender's
Percentage of the amount of each draft drawn under a Letter of Credit in
accordance with this Section 1.3 and, accordingly, each Letter of Credit shall
be deemed to utilize the Revolving Credit Commitments of all Lenders pro rata in
accordance with their Percentages thereof.
(b) Term. Each Letter of Credit issued hereunder shall expire not later
than the earlier of (i) twelve (12) months from the date of issuance (or be
cancelable not later than twelve (12) months from the date of issuance and each
renewal) or (ii) the Revolving Credit Termination Date. In the event the Agent
issues any Letter of Credit with an expiration date that is automatically
extended unless the Agent gives notice that the expiration date will not so
extend beyond its then scheduled expiration date, the Agent will give such
notice of non-renewal before the time necessary to prevent such automatic
extension if before such required notice date (i) the expiration date of such
Letter of Credit if so extended would be after the Revolving Credit Termination
Date, (ii) the Revolving Credit Commitments have terminated or (iii) an Event of
Default exists and the Required Lenders have given the Agent instructions not to
so permit the extension of the expiration date of such Letter of Credit.
(c) General Characteristics. Each Letter of Credit issued hereunder
shall be payable in U.S. Dollars or an Alternative Currency, conform to the
general requirements of the Agent for the issuance of standby or commercial
letters of credit , as the case may be, as to form and substance, and be a
letter of credit which the Agent may lawfully issue.
(d) Applications. At the time the Company requests each Letter of
Credit to be issued (or prior to the first issuance of a Letter of Credit in the
case of a continuing application), the Company shall execute and deliver to the
Agent an application for such Letter of Credit in the form then customarily
prescribed by the Agent (individually an "Application" and collectively the
"Applications"). Subject to the other provisions of this subsection, the
obligation of the Company to reimburse the Agent for drawings under a Letter of
Credit shall be governed by the Application for such Letter of Credit. Anything
contained in the Applications to the contrary notwithstanding, (i) the
reimbursement by the Company of draws under a Letter of Credit denominated in
U.S. Dollars shall be made in U.S. Dollars, (ii) the reimbursement by the
Company of draws made under a Letter of Credit denominated in an Alternative
Currency shall be made by payment in U.S. Dollars of the U.S. Dollar Equivalent,
calculated on the date the Agent paid such draw, of the amount paid by the Agent
pursuant to such draw, or, if the Agent shall elect by notice to the Company by
payment in the Alternative Currency which was paid by the Agent pursuant to such
drawing in an amount equal to such drawing, (iii) the in the event the Agent is
not reimbursed by the Company for the amount the Agent pays on any draft drawn
under a Letter of Credit denominated in U.S. Dollars by 1:00 p.m. (Chicago time)
on the date when such drawing is paid, the obligation of the Company to
reimburse the Agent for the amount of such draft paid shall bear interest (which
the Company hereby promises to pay on demand) from and after the date the draft
is paid until payment in full thereof at a fluctuating rate per annum determined
by adding 2% to the Domestic Rate as from time to time in effect (computed on
the basis of a year of 360 days for the actual number of days elapsed), (iv) or
in the event the Agent is not reimbursed by the Company for the amount the Agent
pays on any draft drawn under a Letter of Credit denominated in an Alternative
Currency by 11:00 a.m. local time at the place of payment or, if earlier, such
local time as is necessary for such funds to be received and transferred to the
Agent for same day value the date such payment is due, the obligation of the
Company to reimburse the Agent for the amount of such draft paid shall bear
interest (which the Company hereby promises to pay on demand) from and after the
date the draft is paid until payment in full thereof at a fluctuating rate per
annum equal to (X) in the case of a drawing under a Letter of Credit denominated
in an Alternative Currency as to which the Agent has requested that the Company
reimburse such drawing in U.S. Dollars, the sum of 2% plus the Domestic Rate
from time to time in effect (computed on the basis of a year of 360 days for the
actual number of days elapsed) and (Y) in the case of a drawing under a Letter
of Credit denominated in an Alternative Currency as to which the Agent has
requested that the Company reimburse such drawing in the Alternative Currency in
which such Letter of Credit was denominated, the sum of 2% plus the Overnight
Foreign Currency Rate, (v) the Company shall pay fees in connection with each
Letter of Credit as set forth in Section 3 hereof, (vi) except as otherwise
provided in Section 3.4 hereof, prior to the occurrence of a Default or an Event
of Default the Agent will not call for additional collateral security for the
obligations of the Company under the Applications, and (vii) except as otherwise
provided in Section 3.4 hereof, prior to the occurrence of a Default or an Event
of Default the Agent will not call for the funding of a Letter of Credit by the
Company prior to being presented with a draft drawn thereunder (or, in the event
the draft is a time draft, prior to its due date). The Company hereby
irrevocably authorizes the Agent to charge any of the Company's deposit accounts
maintained with the Agent for the amount necessary to reimburse the Agent for
any drafts drawn under Letters of Credit issued hereunder.
(e) Change in Laws. If the Agent or any Lender shall determine in good
faith that any change in any applicable law, regulation or guideline (including,
without limitation, Regulation D of the Board of Governors of the Federal
Reserve System) or any new law, regulation or guideline, or any interpretation
of any of the foregoing by any governmental authority charged with the
administration thereof or any central bank or other fiscal, monetary or other
authority having jurisdiction over the Agent or such Lender (whether or not
having the force of law), shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against the Letters of Credit, or the
Agent's or such Lender's or the Company's liability with respect
thereto; or
(ii) impose on the Agent or such Lender any penalty with
respect to the foregoing or any other condition regarding this
Agreement, the Applications or the Letters of Credit;
and the Agent or such Lender shall determine in good faith that the result of
any of the foregoing is to increase the cost (whether by incurring a cost or
adding to a cost) to the Agent or such Lender of issuing, maintaining or
participating in the Letters of Credit hereunder (without benefit of, or credit
for, any prorations, exemptions, credits or other offsets available under any
such laws, regulations, guidelines or interpretations thereof), then the Company
shall pay on demand to the Agent or such Lender from time to time as specified
by the Agent or such Lender such additional amounts as the Agent or such Lender
shall determine are sufficient to compensate and indemnify it for such increased
cost. If the Agent or any Lender makes such a claim for compensation, it shall
provide the Company (with a copy to the Agent in the case of any Lender) a
certificate setting forth the computation of the increased cost as a result of
any event mentioned herein in reasonable detail and such certificate shall be
conclusive if reasonably determined.
(f) Participations in Letters of Credit. Each Lender shall participate
on a pro rata basis in accordance with its Percentage of the Revolving Credit
Commitments in the Letters of Credit issued by the Agent, which participation
shall automatically arise upon the issuance of each Letter of Credit. Each
Lender unconditionally agrees that in the event the Agent is not immediately
reimbursed by the Company for the amount paid by the Agent on any draft
presented under a Letter of Credit, then in that event such Lender shall pay to
the Agent (i) in the case of a Reimbursement Obligation payable in U.S. Dollars,
an amount equal to such Lender's Percentage of such unpaid Reimbursement
Obligation, such payment to be made in lawful money in the United States, in
immediately available funds at the Agent's principal office in Chicago,
Illinois, together with interest on such amount accrued from the date the
related payment was made by the Agent to the date of such payment by such Lender
at a rate per annum equal to (X) from the date the related payment was made by
the Agent to the date two (2) Business Days after payment by such Lender is due
hereunder, the Federal Funds Rate for each such day and (Y) from the date two
(2) Business Days after the date such payment is due from such Lender to the
date such payment is made by such Lender, the Domestic Rate in effect for each
such day and (ii) in the case of a Reimbursement Obligation payable in an
Alternative Currency, an amount equal to such Lender's Percentage of such unpaid
Reimbursement Obligation, such payment to be made in such Alternative Currency
in such funds which are then customary for the settlement of international
transactions in such currency, together with interest on such amount accrued
from the date the related payment was made by the Agent to the date of such
payment by the Lender at the rate per annum equal to (X) from the date the
related payment was made by the Agent to the date two (2) Business Days after
payment by such Lender is due hereunder, the Overnight Foreign Currency Rate for
each such day and (Y) from the date two (2) Business Days after the date such
payment is due from such Lender to the date such payment is made by such Lender,
the sum of 1% plus the Overnight Foreign Currency Rate for each such day. The
obligations of the Lenders to the Agent under this subsection shall be absolute,
irrevocable and unconditional under any and all circumstances whatsoever and
shall not be subject to any set-off, counterclaim or defense to payment which
any Lender may have or have had against the Company, the Agent, any other Lender
or any other party whatsoever. In the event that any Lender fails to honor its
obligation to reimburse the Agent for its Percentage of the amount of any such
draft, then in that event the defaulting Lender shall have no right to
participate in any recoveries from the Company in respect of such draft.
(g) Original Dollar Amount Determinations. The Agent shall determine
the Original Dollar Amount of Letters of Credit denominated in Alternative
Currencies, and its determination thereof shall be conclusive and binding except
in the case of manifest error or willful misconduct. The Original Dollar Amount
of a Letter of Credit shall be calculated on the date of issuance and on the
last day of each calendar quarter thereafter and at the request of any Lender or
the Company, at such additional times, and from time to time, as may be
requested; provided, however, that the Original Dollar Amount of a Reimbursement
Obligation shall be calculated on the date of the Agent's payment of the drawing
giving rise to such Reimbursement Obligation and at such additional times, and
from time to time, as the Agent or Required Lenders may request.
Section 1.4. Manner and Disbursement of Revolving Loans.
(a) Notice to the Agent and the Lenders. The Company shall give written
or telephonic notice to the Agent (which notice shall be irrevocable once given
and, if given by telephone, shall be promptly confirmed in writing) by no later
than 11:00 a.m. (Chicago time) on the date the Company requests that any
Borrowing of Revolving Loans be made to it under the Revolving Credit
Commitments, and the Agent shall promptly notify each Lender of the Agent's
receipt of each such notice. Each such notice shall specify the date of the
Borrowing of Revolving Loans requested (which must be a Business Day and which
date shall be at least three Business Days subsequent to the date of such notice
in the case of any Revolving Loans constituting a LIBOR Portion denominated in
U.S. Dollars and at least four Business Days subsequent to the date of such
notice in the case of any Revolving Loans constituting a LIBOR Portion
denominated in an Alternative Currency), the type of Revolving Loan being
requested, and the amount of such Borrowing. Each Borrowing of Revolving Loans
shall initially constitute part of the Domestic Rate Portion except to the
extent the Company has otherwise timely elected that such Borrowing, or any part
thereof, constitute part of a LIBOR Portion as provided in Section 2 hereof. The
Company agrees that the Agent may rely upon any written or telephonic notice
given by any person the Agent in good faith believes is an Authorized
Representative without the necessity of independent investigation and, in the
event any telephonic notice conflicts with the written confirmation, such
telephonic notice shall govern if the Agent and the Lenders have acted in
reliance thereon.
(b) Disbursement of Revolving Loans. Not later than 1:00 p.m. (Chicago
time) on the date specified for any Borrowing of Revolving Loans to be made
hereunder (other than a Borrowing of Revolving Loans to the extent constituting
a LIBOR Portion denominated in an Alternative Currency), each Lender shall make
the proceeds of its Revolving Loan comprising part of such Borrowing available
to the Agent in Chicago, Illinois in immediately available funds to the Agent in
Chicago. Each Lender shall make the proceeds of each Revolving Loan constituting
a LIBOR Portion denominated in an Alternative Currency at such office as the
Agent has previously specified in a notice to such Lender in such funds which
are then customary for the settlement of international transactions in such
currency and no later than such local time as is necessary for such funds to be
received and transferred to the Company for same day value on the date the
Revolving Loan is to be made. Subject to the provisions of Section 7 hereof, the
proceeds of each Lender's Revolving Loan denominated in U.S. Dollars shall be
made available to the Company at the office of the Agent in Chicago, Illinois,
and the proceeds of each Lender's Revolving Loans denominated in an Alternative
Currency shall be made available to the Company at such office as the Agent has
previously agreed to with the Company, in each case in the type of funds
received by the Agent from the Lenders. Unless the Agent shall have been
notified by a Lender by no later than such time as would be necessary for such
Lender to make the proceeds of its Revolving Loan available to the Agent on the
date a Borrowing is to be made hereunder that such Lender does not intend to
make the proceeds of its Revolving Loan available to the Agent, the Agent may
assume that such Lender has made such proceeds available to the Agent on such
date and the Agent may in reliance upon such assumption make available to the
Company a corresponding amount. If such corresponding amount is not in fact made
available to the Agent by such Lender and the Agent has made such amount
available to the Company, the Agent shall be entitled to receive such amount
from such Lender forthwith upon the Agent's demand, together with interest
thereon in respect of each day during the period commencing on the date such
amount was made available to the Company and ending on but excluding the date
the Agent recovers such amount at a rate per annum equal to the effective rate
charged to the Agent for overnight federal funds transactions with member banks
of the federal reserve system, or in the case of a Revolving Loan denominated in
an Alternative Currency, the Overnight Foreign Currency Rate, for each day as
determined by the Agent (or in the case of a day which is not a Business Day,
then for the preceding day). If such amount is not received from such Lender by
the Agent immediately upon demand, the Company will, on demand, repay to the
Agent the proceeds of such Revolving Loan attributable to such Lender with
interest thereon at a rate per annum equal to the interest rate applicable to
the relevant Revolving Loan, but without such payment being considered a payment
or prepayment of a LIBOR Portion, so that the Company will have no liability
under Section 2.9 hereof with respect to such payment.
(c) Company's Failure to Notify. In the event the Company fails to give
notice pursuant to Section 1.4(a) above of a Borrowing equal to the amount for
which the Company is obligated to reimburse the Agent for a drawing which the
Agent has paid on a Letter of Credit (a "Reimbursement Obligation") and has not
notified the Agent by 12:00 noon (Chicago time) on the day such Reimbursement
Obligation becomes due that the Company intends to repay such Reimbursement
Obligation through funds not borrowed under this Agreement, the Company shall be
deemed to have requested a Borrowing of Revolving Loans constituting a Domestic
Rate Portion on such day in the amount of the Reimbursement Obligation then due,
subject to Section 7 hereof, which Borrowing shall be applied to pay the
Reimbursement Obligation then due.
Section 1.5. The Swing Line.
(a) Swing Loans. Subject to all of the terms and conditions hereof and
in reliance on the obligations of the Lenders to the Agent under this Section
1.5, ▇▇▇▇▇▇ Bank agrees to make Loans (each, a "Swing Loan" and, collectively,
the "Swing Loans") in U.S. Dollars to the Company under a line of credit (the
"Swing Line") which shall not in the aggregate at any time outstanding exceed
the lesser of (i) the Swing Line Commitment or (ii) the excess, if any, of (x)
the Revolving Credit Commitments in effect at such time over (y) the aggregate
Original Dollar Amount of Loans (both Revolving Loans and Swing Loans) and
Letters of Credit outstanding at the time of computation. The Swing Line
Commitment shall be available to the Company and may be availed of by the
Company from time to time and borrowings thereunder may be repaid and used again
during the period ending on the Revolving Credit Termination Date.
(b) Swing Note. All Swing Loans made to the Company by ▇▇▇▇▇▇ Bank
shall be evidenced by a promissory note of the Company (the "Swing Note"), the
Swing Note to be payable to ▇▇▇▇▇▇ Bank's order in the principal amount of its
Swing Line Commitment and otherwise in the form of Exhibit A-2 hereto. Without
regard to the face principal amount of the Swing Note, the actual principal
amount at any time outstanding and owing by the Company on account of the Swing
Note on any date during the period ending on the Revolving Credit Termination
Date shall be the sum of all Swing Loans then or theretofor made thereon through
such date less all payments actually received thereon through such date.
(c) Minimum Borrowing Amount. Each Swing Loan shall be in an amount not
less than $100,000.
(d) Interest on Swing Loans. Each Swing Loan shall bear interest prior
to maturity either at the rate per annum equal at all times to the Domestic Rate
as from time to time in effect or subject to the provisions of Section 1.5(e)
hereof, at ▇▇▇▇▇▇ Bank's Quoted Rate for the Interest Period selected therefor.
Interest on each Swing Loan shall be due and payable prior to such maturity on
the last day of each Interest Period applicable thereto. Notwithstanding
anything to the contrary contained in this Section 1.5(d), if any Swing Loan is
not paid when due (whether by lapse of time, acceleration or otherwise), such
Swing Loan shall bear interest whether before or after judgment, until payment
in full thereof:
(i) with respect to any Quoted Rate Portion of the Swing
Note, through the end of the Interest Period then applicable thereto at
the rate per annum determined by adding 2% to the rate of interest
otherwise applicable thereto and effective at the end of such Interest
Period, such Quoted Rate Portion shall automatically cease to exist and
such principal indebtedness shall thereafter bear interest at the rate
per annum determined by adding the sum of 2% to the Domestic Rate as in
effect from time to time; and
(ii) with respect to any portion of the principal indebtedness
of the Swing Note bearing interest with reference to the Domestic Rate,
at the rate per annum determined by adding the sum of 2% to the
Domestic Rate as in effect from time to time.
Interest on each Swing Loan shall be due and payable on the last day of each
Interest Period applicable thereto, and interest after maturity (whether by
lapse of time, acceleration or otherwise) shall be due and payable upon demand.
All interest on the Swing Loans bearing interest at the Domestic Rate shall be
computed on the basis of a year of 365 or 366 days, as the case may be, for the
actual number of days elapsed and all interest on the Swing Loans bearing
interest at ▇▇▇▇▇▇ Bank's Quoted Rate shall be computed on the basis of a year
of 360 days for the actual number of days elapsed.
(e) Requests for Swing Loans. The Company shall give ▇▇▇▇▇▇ Bank prior
notice (which may be written or oral) no later than (i) 3:00 p.m. (Chicago time)
in the case of Swing Loans bearing interest at the Domestic Rate and (ii) no
later than 11:00 a.m. (Chicago time) in the case of Swing Loans bearing interest
at ▇▇▇▇▇▇ Bank's Quoted Rate, in each case on the date upon which the Company
requests that any Swing Loan be made, of the amount and date of such Swing Loan
and in the event the Company is requesting the Swing Loan be made available by a
Quoted Rate Portion, the Interest Period selected therefor. If the Company has
requested that such Swing Loan be made available as a Quoted Rate Portion,
within thirty (30) minutes after receiving such notice, ▇▇▇▇▇▇ Bank shall quote
an interest rate determined in its discretion to the Company at which ▇▇▇▇▇▇
Bank would be willing to make such Swing Loan available to the Company for such
Interest Period (the rate so quoted for a given Interest Period being herein
referred to as "▇▇▇▇▇▇ Bank's Quoted Rate"). The Company acknowledges and agrees
that the interest rate quote is given for immediate and irrevocable acceptance,
and if the Company does not so immediately accept ▇▇▇▇▇▇ Bank's Quoted Rate for
the full amount requested by the Company for such Swing Loan, the ▇▇▇▇▇▇ Bank's
Quoted Rate shall be deemed immediately withdrawn and such Swing Loan shall be
made bearing interest with reference to the Domestic Rate as set forth in
Section 1.5(d) above unless the Company has specifically in its notice to ▇▇▇▇▇▇
Bank for such Swing Loan specifically requested otherwise, in which event such
Swing Loan shall not be made at all. Subject to all of the terms and conditions
hereof, the proceeds of such Swing Loan shall be made available to the Company
in immediately available funds on the date so requested at the offices of the
Agent in Chicago, Illinois. Anything contained in the foregoing to the contrary
notwithstanding (i) the obligation of ▇▇▇▇▇▇ Bank to make Swing Loans shall be
subject to all of the terms and conditions of this Agreement and (ii) ▇▇▇▇▇▇
Bank shall not be obligated to make more than one Swing Loan during any one day.
(f) Refunding Loans. In its sole and absolute discretion, ▇▇▇▇▇▇ Bank
may at any time, on behalf of the Company (which hereby irrevocably authorizes
▇▇▇▇▇▇ Bank to act on its behalf for such purpose), request each Bank to make a
Revolving Loan in an amount equal to such Bank's Percentage of the amount of the
Swing Loans outstanding on the date such notice is given. Whether or not any of
the conditions of Section 7.1 are fulfilled on such date, unless a Bank is
legally precluded from doing so, each Bank shall make the proceeds of its
requested Revolving Loan available to ▇▇▇▇▇▇ Bank, in immediately available
funds, at the principal office of ▇▇▇▇▇▇ Bank in Chicago, Illinois, before 12:00
Noon (Chicago time) on the Business Day following the day such notice is given.
The proceeds of such Revolving Loans shall be immediately applied to repay the
outstanding Swing Loans.
(g) Participations. If any Bank refuses or otherwise fails to make a
Revolving Loan when requested by ▇▇▇▇▇▇ Bank pursuant to Section 1.5(f) above,
or if ▇▇▇▇▇▇ Bank is required at any time to return to the Company or to a
trustee, receiver, liquidator, custodian or other Person, any portion of any
payment of a Swing Loan, each such Bank (in this Section, a "Participating
Bank") will, by the time and in the manner such Revolving Loan was to have been
funded to ▇▇▇▇▇▇ Bank, purchase from ▇▇▇▇▇▇ Bank an undivided participating
interest in the outstanding Swing Loans in an amount equal to its Percentage of
the aggregate principal amount of Swing Loans that were to have been repaid with
such Revolving Loans or such recapture Swing Loan, as the case may be. Each
Participating Bank's obligation to fund such participation shall bear interest
from the date due until funded at the rate per annum equal to (i) from the date
the related payment was due from such Participating Bank to the date two (2)
Business Days thereafter, the Federal Funds Rate for each such day and (ii) from
the date two (2) Business Days after the date such payment is due from such
Participating Bank to the date such payment is made by such Participating Bank,
the Domestic Rate in effect for each such day. Each Bank that so purchases a
participation in a Swing Loan shall thereafter be entitled to receive its
Percentage of each payment of principal received on the Swing Loan and of
interest received thereon accruing from the date such Bank funded to ▇▇▇▇▇▇ Bank
its participation in such Loan. The several obligations of the Participating
Banks under this Section 1.5 shall be absolute, irrevocable and unconditional
under any and all circumstances whatsoever and shall not be subject to any
set-off, counterclaim or defense to payment which any Participating Bank may
have or have had against the Company, any other Bank or any other Person
whatever. Without limiting the generality of the foregoing, such obligations
shall not be affected by any Default or Event of Default or by any reduction or
termination of any Commitment of any Bank, and each payment made by a
Participating Bank under this Section 1.5 shall be made without any offset,
abatement, withholding or reduction whatsoever. ▇▇▇▇▇▇ Bank shall be entitled to
offset amounts received for the account of a Bank under this Agreement against
unpaid amounts due hereunder from such Bank to ▇▇▇▇▇▇ Bank or (if and so long as
▇▇▇▇▇▇ Bank is the Agent) the Agent (whether as fundings of participations or
otherwise), but shall not be entitled to offset against amounts owed to the
▇▇▇▇▇▇ Bank or the Agent by any Bank arising outside the Loan Documents.
(h) Indemnification. The Participating Banks shall, to the extent of
their respective Percentages, indemnify ▇▇▇▇▇▇ Bank (to the extent not
reimbursed by the Company and without in any way impairing or otherwise
affecting the Company's obligations to do so) against any cost, expense
(including reasonable counsel fees and disbursements), claim, demand, action,
loss or liability (except such as result from ▇▇▇▇▇▇ Bank's gross negligence or
willful misconduct) that ▇▇▇▇▇▇ Bank may suffer or incur in connection with any
Swing Loan. The obligations of the Participating Banks under this Section 1.5(h)
and all other parts of this Section 1.5 shall survive termination of this
Agreement.
Section 1.6. Extensions of the Revolving Credit Termination Date. The
Company may advise the Agent in writing of its desire to extend the Revolving
Credit Termination Date for an additional 364 days; provided (i) such request is
made no later than 90 days prior to the date on which such Revolving Credit
Termination Date is scheduled to occur, (ii) not more than one such request for
the extension of a Termination Date may be made in any one calendar year and
(iii) in no event shall the Revolving Credit Termination Date be extended beyond
July 1, 2003. The Agent shall promptly notify the Lenders of each such request.
Each Lender shall notify the Agent in writing within 45 days after such Lender
receives such notice from the Agent, whether such Lender in its sole discretion
agrees to such extension (each such Lender agreeing to such extension being
hereinafter referred to as a "Consenting Lender"). In the event that a Lender
shall fail to so notify the Agent within such 45-day period, whether it agrees
to such extension, such Lender shall be deemed to have refused to grant the
requested extension. Upon receipt by the Agent of the consent of all the Lenders
within such 45-day period, the Revolving Credit Termination Date or Dates shall
be automatically extended for 364 days. In the event the Company and all the
Lenders do not consent to the requested extension of the Revolving Credit
Termination Date, such Revolving Credit Termination Date shall take place as
scheduled.
Section 1.7. Maturity of Loans. Each Revolving Loan shall mature and
become due and payable by the Company on the Revolving Credit Termination Date.
Each Swing Loan shall mature and become due and payable on the earlier of (i)
the last day of its Interest Period and (ii) the Revolving Credit Termination
Date.
SECTION 2. INTEREST AND CHANGE IN CIRCUMSTANCES.
Section 2.1. Interest Rate Options on Revolving Notes.
(a) Portions. Subject to the terms and conditions of this Section 2,
portions of the principal indebtedness evidenced by the Revolving Notes (all of
the indebtedness evidenced by the Revolving Notes bearing interest at the same
rate for the same period of time being hereinafter referred to as a "Portion")
may, at the option of the Company, bear interest with reference to the Domestic
Rate ("Domestic Rate Portions") or with reference to the Adjusted LIBOR ("LIBOR
Portions"), and Portions may be converted from time to time from one basis to
another. All of the indebtedness evidenced by a particular class of Revolving
Notes which is not part of a LIBOR Portion shall constitute a single Domestic
Rate Portion. LIBOR Portions may be denominated in U.S. Dollars or an
Alternative Currency, but Domestic Rate Portions must be denominated in U.S.
Dollars only. All of the indebtedness evidenced by Revolving Notes of the same
type which bears interest with reference to a particular Adjusted LIBOR for a
particular Interest Period and is denominated in a particular currency shall
constitute a single LIBOR Portion. There shall not be more than five (5) LIBOR
Portions applicable to the Revolving Notes outstanding at any one time, and each
Lender shall have a ratable interest in each Portion based on its Percentage.
Anything contained herein to the contrary notwithstanding, the obligation of the
Lenders to create, continue or effect by conversion any LIBOR Portion shall be
conditioned upon the fact that at the time no Default or Event of Default shall
have occurred and be continuing. The Company hereby promises to pay interest on
each Portion at the rates and times specified in this Section 2.
(b) Domestic Rate Portion. Each Domestic Rate Portion shall bear
interest at the rate per annum determined by adding the Applicable Margin to the
Domestic Rate as in effect from time to time, provided that if a Domestic Rate
Portion or any part thereof is not paid when due (whether by lapse of time,
acceleration or otherwise) such Portion shall bear interest, whether before or
after judgment, until payment in full thereof at the rate per annum determined
by adding 2% to the interest rate which would otherwise be applicable thereto
from time to time. Interest on each Domestic Rate Portion shall be payable
quarterly in arrears on the last day of each March, June, September and December
in each year (commencing December 31, 1999) and at maturity of the applicable
Revolving Notes, and interest after maturity (whether by lapse of time,
acceleration or otherwise) shall be due and payable upon demand. Any change in
the interest rate on the Domestic Rate Portions resulting from a change in the
Domestic Rate shall be effective on the date of the relevant change in the
Domestic Rate.
(c) Libor Portions. Each LIBOR Portion shall bear interest for each
Interest Period selected therefor at a rate per annum determined by adding the
Applicable LIBOR Margin to the Adjusted LIBOR for such Interest Period, provided
that if any LIBOR Portion is not paid when due (whether by lapse of time,
acceleration or otherwise) such Portion shall bear interest, whether before or
after judgment, until payment in full thereof (i) if such Portion is denominated
in U.S. Dollars at the rate per annum determined by adding 2% to the interest
rate which would otherwise be applicable thereto through the end of the Interest
Period then applicable thereto, and effective at the end of such Interest Period
such LIBOR Portion shall automatically be converted into and added to the
Domestic Rate Portion and shall thereafter bear interest at the interest rate
applicable to such Domestic Rate Portion after default and (ii) if such Portion
is denominated in an Alternative Currency, at the rate per annum determined by
adding 2% to the interest rate which would otherwise be applicable thereto at
the time of such default until the end of the Interest Period applicable thereto
and, thereafter, at a rate per annum equal to the sum of the Applicable Margin
plus 2% plus the Overnight Foreign Currency Rate. Interest on each LIBOR Portion
shall be due and payable on the last day of each Interest Period applicable
thereto and, with respect to any Interest Period applicable to a LIBOR Portion
in excess of 3 months, on the date occurring every 3 months after the date such
Interest Period began and at the end of such Interest Period, and interest after
maturity (whether by lapse of time, acceleration or otherwise) shall be due and
payable upon demand. The Company shall notify the Agent on or before 11:00 a.m.
(Chicago time) on the fourth Business Day preceding the end of an Interest
Period applicable to a LIBOR Portion whether such LIBOR Portion is to continue
as a LIBOR Portion in the same currency, in which event the Company shall notify
the Agent of the new Interest Period selected therefor, and in the event the
Company shall fail to so notify the Agent, such LIBOR Portion, if denominated in
U.S. Dollars, shall automatically be converted into and added to the Domestic
Rate Portion as of and on the last day of such Interest Period or, if
denominated in an Alternative Currency, shall automatically as of the last day
of such Interest Period, be continued as a LIBOR Portion in the same amount and
in the same currency and with an Interest Period of one month, subject to
Section 7 hereof. The Agent shall promptly notify each Lender of each notice
received from the Company pursuant to the foregoing provisions. Anything
contained herein to the contrary notwithstanding, the obligation of the Lenders
to create, continue or effect by conversion any LIBOR Portion shall be
conditioned upon the fact that at the time no Default or Event of Default shall
have occurred and be continuing.
On the date the Company requests a Revolving Loan in an Alternative
Currency, as provided in Section 2.4, the Agent shall promptly notify each
Lender of the currency in which such Revolving Loan is requested. If a Lender
determines that such Alternative Currency is not available to it in sufficient
amount and for a sufficient term to enable it to advance or continue the
Revolving Loan requested of it as part of such LIBOR Portion and so notifies the
Agent no later than 2:00 p.m. (Chicago time) on the same day it receives notice
from the Agent of such requested Revolving Loan, the Agent shall so notify the
Company by 2:45 p.m. (Chicago time). If the Company nevertheless desires such
Revolving Loan, it must notify the Agent by no later than 3:00 p.m. (Chicago
time) on such day. If the Agent does not receive such notice from the Company by
3:00 p.m. (Chicago time), the Company shall automatically be deemed to have
revoked its request for the Revolving Loan and the Agent will promptly notify
the Lenders of such revocation. If the Company does give such notice by 3:00
p.m. (Chicago time), each Lender that did not notify the Agent by 2:00 p.m.
(Chicago time) that the requested Alternative Currency is unavailable to it to
fund the requested Revolving Loan shall, subject to Section 7 hereof, make its
Revolving Loan in the requested Alternative Currency in accordance with Section
1.4 hereof. Each Lender that did so notify the Agent by 2:00 p.m. (Chicago time)
that it would not be able to make the Revolving Loan requested from it shall,
subject to Section 7 hereof, make a Revolving Loan denominated in U.S. Dollars
in the Original Dollar Amount of, and with the same Interest Period as, the
Revolving Loan such Lender was originally requested to make. Such Revolving Loan
denominated in U.S. Dollars shall be made by the affected Lender on the same day
as the other Lenders make their Revolving Loans denominated in the applicable
Alternative Currency as part of the relevant LIBOR Portion, but shall bear
interest with reference to the Adjusted LIBOR applicable to U.S. Dollars rather
than the relevant Alternative Currency for the applicable Interest Period and
shall be made available in accordance with the procedures for disbursing U.S.
Dollar Loans under Section 1.4 hereof. Any Revolving Loan made in an Alternative
Currency shall be advanced in such currency, and all payments of principal and
interest thereon shall be made in such Alternative Currency.
Section 2.2. Minimum Borrowing Amounts. Each Domestic Rate Portion
shall be in an amount equal to $500,000 or such greater amount which is an
integral multiple of $100,000. Each LIBOR Portion denominated in U.S. Dollars
shall be in an amount equal to $1,000,000 or such greater amount which is an
integral multiple of $500,000. Each LIBOR Portion denominated in an Alternative
Currency shall be in a minimum amount for which the U.S. Dollar Equivalent is
$2,000,000 and which is an integral multiple of 500,000 units of the relevant
currency or, solely in the case of a LIBOR Portion denominated in an Alternative
Currency being continued in the same currency, if less, the same amount of such
currency.
Section 2.3. Computation of Interest. All interest on the Revolving
Loans constituting part of the Domestic Rate Portion shall be computed on the
basis of a year of 365 or 366 days, as the case may be, for the actual number of
days elapsed. All interest on the Revolving Loans constituting all or part of a
LIBOR Portion shall be computed on the basis of a year of 360 days for the
actual number of days elapsed.
Section 2.4. Manner of Rate Selection. The Company shall notify the
Agent by 11:00 a.m. (Chicago time) at least 3 Business Days prior to the date
upon which the Company requests that any LIBOR Portion denominated in U.S.
Dollars be created or that any part of a LIBOR Portion otherwise denominated or
any part of a Domestic Rate Portion be converted into a LIBOR Portion
denominated in U.S. Dollars and (iii) by 12:00 Noon (Chicago time) at least 4
Business Days prior to the date upon which the Company requests that any LIBOR
Portion denominated in an Alternative Currency be created or that any part of a
LIBOR Portion otherwise denominated or any part of a Domestic Rate Portion be
converted into a LIBOR Portion denominated in an Alternative Currency. Each such
notice shall specify in each instance the amount of the Portion being created or
converted and in the case of the creation of or conversion into any LIBOR
Portion, the Interest Period selected therefor and the currency in which such
Portion is to be denominated. If any request is made to convert a LIBOR Portion
into another type of Portion available hereunder, such conversion shall only be
made so as to become effective as of the last day of the Interest Period
applicable thereto. All requests for the creation, continuance and conversion of
Portions under this Agreement shall be irrevocable. Such requests may be written
or oral and the Agent is hereby authorized to honor telephonic requests for
creations, continuances and conversions received by it from any person the Agent
in good faith believes to be an Authorized Representative without the necessity
of independent investigation, the Company hereby indemnifying the Agent and the
Lenders from any liability or loss ensuing from so acting. The Agent shall give
prompt notice to the Lenders of any notice it receives pursuant to this Section
and will give prompt notice to each Lender of the Overnight Foreign Currency
Rate as soon as it is set. The Agent shall determine the interest rate
applicable to each LIBOR Portion and the Original Dollar Amount of such Portions
denominated in an Alternative Currency, and a reasonable determination thereof
by the Agent shall be conclusive and binding except in the case of manifest
error or willful misconduct. The Original Dollar Amount of each LIBOR Portion
denominated in an Alternative Currency shall be determined or redetermined, as
applicable, effective as of the first day of each Interest Period applicable to
such Portion. The Agent shall give notice to the Company and each Lender of the
interest rate applicable to each LIBOR Portion and, if such LIBOR Portion is
denominated in an Alternative Currency, shall give notice to the Company and
each Lender of the Original Dollar Amount thereof.
Section 2.5. Change of Law. Notwithstanding any other provisions of
this Agreement or any Note, if at any time any Lender shall determine in good
faith that any change in applicable laws, treaties or regulations or in the
interpretation thereof makes it unlawful for such Lender to create or continue
to maintain any Fixed Rate Portion in the relevant currency, it shall promptly
so notify the Agent (which shall in turn promptly notify the Company and the
other Lenders) and the obligation of such Lender to create, continue or maintain
any such Fixed Rate Portion in such currency under this Agreement shall
terminate until it is no longer unlawful for such Lender to create, continue or
maintain such Fixed Rate Portion. The Company, on demand, shall, if the
continued maintenance of any such Fixed Rate Portion is unlawful, thereupon
prepay the outstanding principal amount of the affected Fixed Rate Portion,
together with all interest accrued thereon and all other amounts payable to the
affected Lender with respect thereto under this Agreement; provided, however,
that the Company may elect to convert the principal amount of the affected Fixed
Rate Portion into another type of Portion available hereunder, subject to the
terms and conditions of this Agreement.
Section 2.6. Unavailability of Deposits or Inability to Ascertain or
Inadequacy of, Fixed Rate. Notwithstanding any other provision of this Agreement
or any Note, if prior to the commencement of any Interest Period, the Required
Lenders shall determine in good faith that (i) deposits in the applicable
currency in the amount of any Fixed Rate Portion scheduled to be outstanding in
such currency during such Interest Period are not readily available to such
Lenders in the relevant market or (ii) by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for ascertaining
Adjusted LIBOR Rate or ▇▇▇▇▇▇ Bank's Quoted Rate, as the case may be, or (iii)
currency control or other exchange regulations are imposed in the country in
which an Alternative Currency is issued with the result that different types of
such currency are issued or (iv) in the determination of the Agent, a U.S.
Dollar Equivalent of an Alternative Currency is not readily calculable, then (x)
such Lenders shall promptly give notice thereof to the Agent (which shall in
turn promptly notify the Company and the other Lenders), (y) the obligations of
the Lenders to create, continue or effect by conversion any such Fixed Rate
Portion in such amount and for such Interest Period shall terminate until
deposits in such amount, in such currency and for the Interest Period selected
by the Company shall again be readily available in the relevant market and
adequate and reasonable means exist for ascertaining Adjusted LIBOR Rate or
▇▇▇▇▇▇ Bank's Quoted Rate, as the case may be, or the U.S. Dollar Equivalent of
such affected currency, as the case may be and (z) within five (5) Business Days
of receipt of such notice from the Agent, the Company shall repay all Revolving
Loans in such affected currency or convert such Revolving Loans into Revolving
Loans denominated in U.S. Dollars or another Alternative Currency, subject to
the other terms set forth in this Agreement.
Section 2.7. Taxes and Increased Costs. With respect to any Fixed Rate
Portion, if any Lender shall determine in good faith that any change in any
applicable law, treaty, regulation or guideline (including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any new
law, treaty, regulation or guideline, or any interpretation of any of the
foregoing by any governmental authority charged with the administration thereof
or any central bank or other fiscal, monetary or other authority having
jurisdiction over such Lender or its lending branch or the Fixed Rate Portions
contemplated by this Agreement (whether or not having the force of law), shall:
(i) impose, increase, or deem applicable any reserve, special
deposit or similar requirement against assets held by, or deposits in
or for the account of, or loans by, or any other acquisition of funds
or disbursements by, such Lender which is not in any instance already
accounted for in computing the interest rate applicable to such Fixed
Rate Portion;
(ii) subject such Lender, any Fixed Rate Portion or a Note to
the extent it evidences such a Portion to any tax (including, without
limitation, any United States interest equalization tax or similar tax
however named applicable to the acquisition or holding of debt
obligations and any interest or penalties with respect thereto), duty,
charge, stamp tax, fee, deduction or withholding in respect of this
Agreement, any Fixed Rate Portion or a Note to the extent it evidences
such a Portion, except such taxes as may be measured by the overall net
income or gross receipts of such Lender or its lending branches and
imposed by the jurisdiction, or any political subdivision or taxing
authority thereof, in which such Lender's principal executive office or
its lending branch is located;
(iii) change the basis of taxation of payments of principal and
interest due from the Company to such Lender hereunder or under a Note
to the extent it evidences any Fixed Rate Portion (other than by a
change in taxation of the overall net income or gross receipts of such
Lender or its lending branches); or
(iv) impose on such Lender any penalty with respect to the
foregoing or any other condition regarding this Agreement, any Fixed
Rate Portion, or its disbursement, or a Note to the extent it evidences
any Fixed Rate Portion;
and such Lender shall determine in good faith that the result of any of the
foregoing is to increase the cost (whether by incurring a cost or adding to a
cost) to such Lender of creating or maintaining any Fixed Rate Portion hereunder
or to reduce the amount of principal or interest received or receivable by such
Lender (without benefit of, or credit for, any prorations, exemption, credits or
other offsets available under any such laws, treaties, regulations, guidelines
or interpretations thereof), then the Company shall pay on demand to the Agent
for the account of such Lender from time to time as specified by such Lender
such additional amounts as such Lender shall reasonably determine are sufficient
to compensate and indemnify it for such increased cost or reduced amount;
provided, however, that the Company shall not be obligated to pay any such
amount or amounts to the extent such additional cost or payment was incurred or
paid by such Lender more than ninety (90) days prior to the date of the delivery
of the certificate referred to in the immediately following sentence (nothing
herein to impair or otherwise affect the Company's liability hereunder for costs
or payments subsequently incurred or paid by such Lender). If a Lender makes
such a claim for compensation, it shall provide to the Company (with a copy to
the Agent) a certificate setting forth the computation of the increased cost or
reduced amount as a result of any event mentioned herein in reasonable detail
and such certificate shall be conclusive if reasonably determined.
Section 2.8. Change in Capital Adequacy Requirements. If any Lender
shall determine that the adoption after the date hereof of any applicable law,
rule or regulation regarding capital adequacy, or any change in any existing
law, rule or regulation, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by such Lender
(or any of its branches) or any corporation controlling such Lender with any
request or directive regarding capital adequacy (whether or not having the force
of law) of any such authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on such Lender's or such
corporation's capital, as the case may be, as a consequence of such Lender's
obligations hereunder or for the credit which is the subject matter hereof to a
level below that which such Lender or such corporation could have achieved but
for such adoption, change or compliance (taking into consideration such Lender's
or such corporation's policies with respect to liquidity and capital adequacy)
by an amount deemed by such Lender to be material, then from time to time,
within fifteen (15) days after demand by such Lender, the Company shall pay to
the Agent for the account of such Lender such additional amount or amounts
reasonably determined by such Lender as will compensate such Lender for such
reduction; provided, however, that the Company shall not be obligated to
compensate such Lender to the extent its rate of return was so reduced more than
ninety (90) days prior to the date of such demand (nothing herein to impair or
otherwise affect the Company's liability hereunder to compensate for subsequent
reductions in such Lender's rate of return).
Section 2.9. Funding Indemnity. In the event any Lender shall incur any
loss, cost or expense (including, without limitation, any loss (including loss
of profit), cost or expense incurred by reason of the liquidation or
re-employment of deposits or other funds acquired or contracted to be acquired
by such Lender to fund or maintain its part of any Fixed Rate Portion or the
relending or reinvesting of such deposits or other funds or amounts paid or
prepaid to such Lender) as a result of:
(i) any payment of a Fixed Rate Portion on a date other than
the last day of the then applicable Interest Period for any reason,
whether before or after default, and whether or not such payment is
required by any provisions of this Agreement; or
(ii) any failure by the Company to create, borrow, continue or
effect by conversion a Fixed Rate Portion on the date specified in a
notice given pursuant to this Agreement;
then, upon the demand of such Lender, the Company shall pay to the Agent for the
account of such Lender such amount as will reimburse such Lender for such loss,
cost or expense. If a Lender requests such a reimbursement, it shall provide to
the Company (with a copy to the Agent) a certificate setting forth the
computation of the loss, cost or expense giving rise to the request for
reimbursement in reasonable detail and such certificate shall be conclusive if
reasonably determined; provided, however, that the Company shall not be
obligated to pay any such amount or amounts to the extent such loss, cost or
expense was incurred by such Lender more than ninety (90) days prior to the date
of the delivery of such certificate (nothing herein to impair or otherwise
affect the Company's liability hereunder to compensate for any subsequent loss,
cost, or expense incurred by such Lender).
Section 2.10. Lending Branch. Each Lender may, at its option, elect to
make, fund or maintain its pro rata share of the Loans hereunder at the
branches, offices, subsidiaries or affiliates specified on the signature pages
hereof or on any Assignment Agreement executed and delivered pursuant to Section
11.10 hereof or at such of its branches, offices, subsidiaries or affiliates as
such Lender may from time to time elect. All the terms of this Agreement shall
only apply to any such branch, office, subsidiary or affiliates and the Loans
and Notes issued hereunder shall be deemed held by each Lender for the benefit
of any such branch, office, subsidiary or affiliate. To the extent reasonably
possible, a Lender shall designate an alternate branch or funding office with
respect to its pro rata share of the LIBOR Portions to reduce any liability of
the Company to such Lender under Section 2.7 hereof or to avoid the
unavailability of an interest rate option under Section 2.6 hereof, so long as
such designation is not otherwise disadvantageous to the Lender.
Section 2.11. Discretion of Lenders as to Manner of Funding.
Notwithstanding any provision of this Agreement to the contrary, each Lender
shall be entitled to fund and maintain its funding of all or any part of its
Notes in any manner it sees fit, it being understood, however, that for the
purposes of this Agreement all determinations hereunder (including, without
limitation, determinations under Sections 2.6, 2.7 and 2.9 hereof) shall be made
as if each Lender had actually funded and maintained each LIBOR Portion during
each Interest Period applicable thereto through the purchase of deposits in U.S.
Dollars or the applicable Alternative Currency, as the case may be, for such
LIBOR Portion, in the relevant market in the amount of such Lender's pro rata
share of such LIBOR Portion, having a maturity corresponding to such Interest
Period, denominated in the relevant currency and bearing an interest rate equal
to the LIBOR Rate, as the case may be, for such Interest Period.
SECTION 3. FEES, PREPAYMENTS, TERMINATIONS, AND APPLICATIONS.
Section 3.1. Fees.
(a) Commitment Fee. For the period from and including the date hereof
to but not including the Revolving Credit Termination Date, the Company shall
pay to the Agent for the account of the Lenders a commitment fee at the rate
equal to the Applicable Margin in effect from time to time (computed on the
basis of a year of 360 days for the actual number of days elapsed) on the
average daily Unused Revolving Credit Commitments. Such commitment fee shall be
payable quarterly in arrears on the last day of each March, June, September and
December in each year (commencing December 31, 1999) and on the Revolving Credit
Termination Date.
(b) Letter of Credit Fees. On the date of issuance of each Letter of
Credit, and as condition thereto, and quarterly in arrears thereafter, the
Company shall pay to the Agent for the account of itself and the Lenders a
letter of credit fee computed at the rate per annum (computed on the basis of a
year of 360 days for the actual number of days elapsed) equal to the Applicable
Margin in effect from time to time for LIBOR Portions on the maximum Original
Dollar Amount of the related Letter of Credit which is scheduled to be
outstanding during the immediately succeeding twelve (12) months. In addition to
the letter of credit fee called for above, the Company further agrees to pay to
the Agent for its own account such processing and transaction fees and charges
as the Agent from time to time customarily imposes in connection with any
amendment, cancellation, negotiation and/or payment of letters of credit and
drafts drawn thereunder.
(c) Agent's Fee. On December 17, 1999 and on the date occurring on each
anniversary of such date when any credit, or commitment to extend credit, is
outstanding hereunder, the Company shall pay to the Agent, for its own use and
benefit, an Agent's fee as mutually agreed upon by the Company and the Agent.
(d) Closing Fees. On the date hereof the Company shall pay to the Agent
a non-refundable closing fee for the account of (i) each of ▇▇▇▇▇▇ Trust and
Savings Bank, Bank One, NA, LaSalle Bank National Association and Bank of
America, N.A., in an amount equal to 0.10% of each such Lender's Revolving
Credit Commitment, and (ii) each Fleet Capital Corporation and Firstar Bank,
N.A., in an amount equal to 0.25% of such Lender's Revolving Credit Commitment.
(e) Audit Fees. The Company shall pay to the Agent for its own use and
benefit charges for audits of the Collateral performed by the Agent or its
agents or representatives in such amounts as the Agent may from time to time
request (the Agent acknowledging and agreeing that such charges shall be
computed in the same manner as it at the time customarily uses for the
assessment of charges for similar collateral audits); provided, however, that in
the absence of any Default and Event of Default, (i) the Agent shall not perform
more than two (2) such audits per calendar year and (ii) the Company shall not
be required to pay the Agent for more than two (2) such audits per calendar
year.
Section 3.2. Prepayments.
(a) Voluntary Prepayments.
(i) Domestic Rate Portions of Revolving Notes. The Company shall have
the privilege of prepaying in whole or in part (but if in part, then in a
minimum amount of $500,000 or such greater amount which is an integral multiple
of $100,000) the Domestic Rate Portion of any Revolving Note at any time upon
notice to the Agent prior to 11:00 a.m. (Chicago time) on the date fixed for
prepayment.
(ii) LIBOR Portions. The Company may prepay any LIBOR Portion of any
Revolving Note only on the last date of the then applicable Interest Period, in
whole or in part (but if in part, then: (x) if such Portion is denominated in
U.S. Dollars, in an amount not less than $1,000,000 or such greater amount which
is an integral multiple of $100,000, (y) if such Portion is denominated in an
Alternative Currency, an amount for which the U.S. Dollar Equivalent is not less
than $1,000,000 and which is an integral multiple of 100,000 units of the
relevant currency and (z) in all cases in an amount such that the minimum amount
required for LIBOR Portion denominated in such currency pursuant to Section 2.2
hereof remains outstanding after giving effect to such payment), upon notice to
the Agent (which notice shall be irrevocable once given, must be received by the
Agent no later than 11:00 a.m. (Chicago time) on the date fixed for prepayment
in the case of a prepayment of the Domestic Rate Portion and on the third
Business Day preceding the date of any such prepayment of a LIBOR Portion
denominated in U.S. Dollars or the fourth Business Day preceding the date of any
such prepayment of a LIBOR Portion denominated in the Alternative Currency, and
in each case shall specify the principal amount to be repaid). Any such
prepayment shall be effected by payment of the principal amount to be prepaid
and accrued interest thereon to the end of the applicable Interest Period.
(iii) Revolving Loans -- Generally. In the case of a prepayment by the
Company under Section 3.2(a)(i) or (ii) hereof, (x) any notice of prepayment by
the Company received by the Agent subsequent to 11:00 a.m. (Chicago time) on a
given day shall be treated as though received at the opening of business on the
next Business Day, (y) the Agent shall promptly notify the Lenders of any notice
of prepayment by the Company, (z) the Company shall prepay the relevant amount
by paying to the Agent for the account of the Lenders the principal amount to be
prepaid and (i) if such a prepayment prepays the Notes in full and is
accompanied by the termination in whole of the Revolving Credit Commitments,
accrued interest thereon to the date of prepayment and (ii) any amounts due to
the Lenders under Section 2.9 hereof.
(iv) Swing Note. The Company may prepay the Swing Note in whole or in
part (but, if in part, then in an amount not less than $100,000 and in integral
multiples of $100,000 and in an amount such that the minimum amount required for
a Swing Loan pursuant to Section 1.5(c) hereof remains outstanding) at any time
upon one (1) Business Day's prior notice to the Agent, such prepayment to be
made by the payment of the principal amount to be prepaid and accrued interest
thereon to the date fixed for prepayment together with any compensation required
by Section 2.9 hereof (any failure of the Agent to require payment of any amount
due under Section 2.9 not to preclude a later demand that the amount so due be
paid).
(b) Mandatory Prepayments. (i) The Company covenants and agrees that if
at any time the sum of the then aggregate Original Dollar Amount of Revolving
Loans then outstanding denominated in Alternative Currencies shall be in excess
of $15,000,000, the Company shall, no later than three (3) Business Days after
the Agent's demand, pay over the amount of such excess to the Agent for the
ratable benefit of the Lenders as and for a mandatory prepayment on the
Revolving Notes until payment in full thereof. Each such prepayment shall be
accompanied by accrued interest on the amount prepaid to the date of prepayment
plus any amounts due to the Lenders under Section 2.9 hereof. The Lenders
acknowledge and agree that, upon such demand by the Agent, the Company may,
subject to Section 7 hereof, request a Borrowing of Revolving Loans in order to
provide it the funds necessary to repay such excess. The Company shall be
responsible for making such arrangements with the Lenders as shall be necessary
to repay such excess. Unless and to the extent a Lender in its discretion agrees
otherwise, nothing in this Section shall impair or otherwise affect the
Company's obligation to repay a Revolving Loan made by such Lender denominated
in an Alternative Currency, nor obligate a Lender to accept repayment of a
Revolving Loan made by such Lender denominated in an Alternative Currency, in a
currency other than such Alternative Currency.
(ii) The Company covenants and agrees that if at any time the sum of the
greater of (x) the aggregate Original Dollar Amount of all Loans (whether
Revolving Loans or Swing Loans) and Letters of Credit and (y) the U.S. Dollar
Equivalent of all Loans (whether Revolving Loans or Swing Loans) and Letters of
Credit exceeds the Revolving Credit Commitments then in effect, the Company
shall immediately and without notice or demand pay over the amount of the excess
to the Agent for the ratable benefit of the Lenders as and for a mandatory
prepayment on the Notes until payment in full thereof. Each such prepayment
shall be accompanied by accrued interest on the amount prepaid to the date of
prepayment plus any amounts due to the Lenders under Section 2.9 hereof.
(iii) If at any time the sum of the aggregate Original Dollar Amount of
all Loans (whether Revolving Loans or Swing Loans) and Letters of Credit then
outstanding shall be in excess of the Borrowing Base, as determined on the basis
of the most recent Borrowing Base Certificate, the Company shall immediately
(except to the extent otherwise set forth in the definition of Borrowing Base)
and without notice or demand pay over the amount of the excess to the Agent for
the account of the Lenders as and for a mandatory prepayment on such
Obligations, with each such prepayment first to be applied to the Revolving
Loans until payment in full thereof, with any remaining balance to be applied to
the Swing Loans until payment in full thereof, and with any remaining balance to
be held by the Agent as collateral security for the Obligations owing with
respect to the Letters of Credit.
Section 3.3. Terminations. The Company shall have the right at any time
and from time to time, upon 5 Business Days' prior notice to the Agent (which
shall promptly so notify the Lenders), to ratably terminate without premium or
penalty and in whole or in part (but if in part, then in an aggregate amount not
less than $1,000,000 or such greater amount which is an integral multiple of
$500,000) the Revolving Credit Commitments; provided, however, that (i) the
Revolving Credit Commitments may not be reduced to an amount less than the
aggregate Original Dollar Amount of the Loans and Letters of Credit then
outstanding and (ii) any termination of the Revolving Credit Commitments below
$5,000,000 shall reduce the Swing Line Commitment by a like amount. Any
termination of the Revolving Credit Commitments pursuant to this Section may not
be reinstated.
Section 3.4. Place and Application of Payments. All payments of
principal, interest, fees and all other Obligations payable hereunder and under
the other Loan Documents to be made in U.S. Dollars shall be made to the Agent
at its office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ (or at such other
place as the Agent may specify) on the date any such payment is due and payable.
Payments to be made in U.S. Dollars received by the Agent after 11:00 a.m.
(Chicago time) shall be deemed received as of the opening of business on the
next Business Day. Notwithstanding anything herein to the contrary, all payments
of principal, interest, fees and all other Obligations to be made in an
Alternative Currency shall be made, by no later than 12:00 noon local time at
the place of payment (or such earlier local time as is necessary for such funds
to be received and transferred to the Agent for same day value on the date the
relevant payment is due) to such office as the Agent has previously specified.
Any payments to be made in an Alternative Currency received by the Agent after
such time shall be deemed received as of the opening of business on the next
Business Day. All such payments shall be made (i) in the case of U.S. Dollars,
in immediately available funds at the place of payment, or (ii) in the case of
amounts payable hereunder in an Alternative Currency, in such funds then
customary for settlement of international transactions in such currency. All
such payments shall be made without set-off or counterclaim and without
reduction for, and free from, any and all present or future taxes, levies,
imposts, duties, fees, charges, deductions, withholdings, restrictions and
conditions of any nature imposed by any government or any political subdivision
or taxing authority thereof (but excluding any taxes imposed on or measured by
the net income of any Lender). Except as herein provided, all payments shall be
received by the Agent for the ratable account of the Lenders and shall be
promptly distributed by the Agent ratably to the Lenders. Principal payments
(including prepayments) on the Notes shall first be applied to the Domestic Rate
Portion of such Notes until payment in full thereof, with any balance applied to
any Fixed Rate Portions of such Notes in the order in which their Interest
Periods expire.
Anything contained herein to the contrary notwithstanding, all payments
and collections received in respect of the Obligations and all proceeds of the
Collateral received, in each instance, by the Agent or any of the Lenders after
the occurrence of an Event of Default shall be remitted to the Agent and
distributed as follows:
(a) first, to the payment of any outstanding costs and
expenses incurred by the Agent, and any security trustee therefor, in
monitoring, verifying, protecting, preserving or enforcing the Liens on
the Collateral in protecting, preserving or enforcing rights under this
Agreement or any of the other Loan Documents, and in any event
including all costs and expenses of a character which the Company has
agreed to pay under Section 11.4 hereof (such funds to be retained by
the Agent for its own account unless it has previously been reimbursed
for such costs and expenses by the Lenders, in which event such amounts
shall be remitted to the Lenders to reimburse them for payments
theretofore made to the Agent);
(b) second, to the payment of any outstanding interest or
other fees or amounts due under this Agreement or any of the other Loan
Documents other than for principal, pro rata as among the Agent and the
Lenders in accord with the amount of such interest and other fees or
amounts owing each;
(c) third, to the payment of the principal of the Swing Note;
(d) fourth, to the payment of the principal of the Revolving
Notes and any liabilities in respect of unpaid drawings under the
Letters of Credit, pro rata as among the Lenders in accord with the
then respective unpaid principal balances of the Revolving Notes and
the then unpaid liabilities in respect of unpaid drawings under the
Letters of Credit;
(e) fifth, to the Agent, to be held as collateral security
for any undrawn Letters of Credit, until the Agent is holding an amount
of cash equal to the then outstanding amount of all Letters of Credit;
(f) sixth, to the Agent and the Lenders pro rata in accord
with the amounts of any other indebtedness, obligations or liabilities
of the Company owing to them and secured by the Collateral Documents
unless and until all such indebtedness, obligations and liabilities
have been fully paid and satisfied; and
(g) seventh, to the Company or to whoever the Agent
reasonably determines to be lawfully entitled thereto.
Section 3.5. Notations. Each Loan made against a Note, the status of
all amounts evidenced by a Note as constituting part of the Domestic Rate
Portion or a LIBOR Portion or Quoted Rate Portion, and, in the case of any Fixed
Rate Portion, the rates of interest and Interest Periods applicable to such
Portion, and the currency in which such Portion is denominated, shall be
recorded by the relevant Lender on its books and records or, at its option in
any instance, endorsed on a schedule to the applicable Note of such Lender and
the unpaid principal balance and status, rate, Interest Periods and currency so
recorded or endorsed by such Lender shall be prima facie evidence in any court
or other proceeding brought to enforce such Note of the principal amount
remaining unpaid thereon, the status of the Loan or Loans evidenced thereby, the
currency in which such Loans were denominated, and the interest rates and
Interest Periods applicable thereto; provided that the failure of a Lender to
record any of the foregoing shall not limit or otherwise affect the obligation
of the Company to repay the principal amount of each Note together with accrued
interest thereon.
SECTION 4. THE COLLATERAL AND GUARANTIES.
Section 4.1. Collateral. The Obligations shall be secured by valid,
perfected (subject to the proviso appearing at the end of this sentence) and
enforceable Liens on all right, title and interest of the Company and each
Guarantor in all accounts and accounts receivable, notes and notes receivable,
contract rights, instruments, documents, chattel paper, general intangibles
(including, without limitation, patents, trademarks, tradenames, copyrights, and
other intellectual property rights, but in any event excluding applications for
trademarks based on "intent to use") and inventory whether now owned or
hereafter acquired or arising, and all proceeds thereof; provided, however, that
the Lien of the Agent on Collateral subject to a Capital Lease or conditional
sale agreement or subject to a purchase money lien, in each instance to the
extent permitted hereby, shall be subject to the rights of the lessor or lender
thereunder. The Company acknowledges and agrees that the Liens on the Collateral
shall be granted to the Agent for the benefit of itself, the Lenders and the
Agent, in its capacity as issuer of the Letters of Credit, and shall be valid
and perfected first priority Liens subject, however, to the proviso appearing at
the end of the immediately preceding sentence, in each case pursuant to one or
more Collateral Documents from such Persons, each in form and substance
satisfactory to the Agent.
Section 4.2. Subsidiary Guaranties. The Loans and other Obligations
shall be guaranteed by each Material Subsidiary pursuant to a written guaranty
from such Material Subsidiary in form and substance reasonably acceptable to the
Required Lenders.
Section 4.3. Further Assurances. The Company agrees that it shall, and
shall cause each Subsidiary to, from time to time at the request of the Agent or
the Required Lenders, execute and deliver such documents and do such acts and
things as the Agent or the Required Lenders may reasonably request in order to
provide for or perfect or protect such Liens on the Collateral. In the event the
Company or any Subsidiary forms or acquires any other Subsidiary after the date
hereof, the Company shall within 10 Business Days of such formation or
acquisition cause such newly formed or acquired Material Subsidiary, or any
Non-Material Subsidiary that thereafter becomes a Material Subsidiary, to
execute a Guaranty and any such Subsidiary to execute such Collateral Documents
as the Agent may then reasonably require, and the Company shall also deliver to
the Agent, or cause such Subsidiary to deliver to the Agent, at the Company's
cost and expense, such other instruments, documents, certificates and opinions
reasonably required by the Agent in connection therewith.
SECTION 5. DEFINITIONS; INTERPRETATION.
Section 5.1. Definitions. The following terms when used herein shall
have the following meanings:
"Acquisition" means (i) the acquisition of all or any substantial part
of the assets, property or business of any other person, firm or corporation, or
(ii) any acquisition of a majority of common stock, warrants or other equity
securities of any firm or corporation.
"Adjusted LIBOR" means a rate per annum determined by the Agent in
accordance with the following formula:
Adjusted LIBOR = LIBOR
-------------------------
100%-Reserve Percentage
"Reserve Percentage" means, for the purpose of computing Adjusted LIBOR, the
maximum rate of all reserve requirements (including, without limitation, any
marginal, emergency, supplemental or other special reserves) imposed by the
Board of Governors of the Federal Reserve System (or any successor) under
Regulation D on Eurocurrency liabilities (as such term is defined in Regulation
D) for the applicable Interest Period as of the first day of such Interest
Period, but subject to any amendments to such reserve requirement by such Board
or its successor, and taking into account any transitional adjustments thereto
becoming effective during such Interest Period. For purposes of this definition,
LIBOR Portions shall be deemed to be Eurocurrency liabilities as defined in
Regulation D without benefit of or credit for prorations, exemptions or offsets
under Regulation D. "LIBOR" means, for each Interest Period, (a) the LIBOR Index
Rate for such Interest Period, if such rate is available, and (b) if the LIBOR
Index Rate cannot be determined, the arithmetic average of the rates of interest
per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) at which
deposits in U.S. Dollars, or the relevant Alternative Currency, as appropriate,
in immediately available funds are offered to the Agent at 11:00 a.m. (London,
England time) 2 Business Days before the beginning of such Interest Period by 3
or more major banks in the interbank eurodollar market selected by the Agent for
a period equal to such Interest Period and in an amount equal or comparable to
the applicable LIBOR Portion scheduled to be outstanding from the Agent during
such Interest Period. "LIBOR Index Rate" means, for any Interest Period, the
rate per annum (rounded upwards, if necessary, to the next higher one
hundred-thousandth of a percentage point) for deposits in U.S. Dollars, or the
relevant Alternative Currency, as appropriate, for a period equal to such
Interest Period which appears on the Telerate Page 3740 or Telerate Page 3750 as
appropriate for such currency as of 11:00 a.m. (London, England time) on the
date 2 Business Days before the commencement of such Interest Period. "Telerate
Page 3740" or "Telerate Page 3750" means each of the displays designated as
"Page 3740" or "Page 3750" respectively on the Telerate Service (or such other
page as may replace Page 3740 or Page 3750 on that service or such other service
as may be nominated by the British Bankers' Association as the information
vendor for the purpose of displaying British Banker's Association Interest
Settlement Rates for U.S. Dollar deposits). Each determination of LIBOR made by
the Agent shall be conclusive and binding on the Company and the Lenders absent
manifest error.
"Affiliate" means any Person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, another Person.
A Person shall be deemed to control another Person for the purposes of this
definition if such Person possesses, directly or indirectly, the power to
direct, or cause the direction of, the management and policies of the other
Person, whether through the ownership of voting securities, common directors,
trustees or officers, by contract or otherwise.
"Agent" means ▇▇▇▇▇▇ Trust and Savings Bank and any successor thereto
appointed pursuant to Section 10.1 hereof.
"Agreement" means this Credit Agreement, as the same may be amended,
modified or restated from time to time in accordance with the terms hereof.
"Alternative Currency" means, subject to the provisions of Section 2.6
hereof, Canadian Dollars, French Francs, Pounds Sterling, Deutsche Marks,
Italian Lira and any other currency (other than U.S. Dollars) approved by each
Lender, so long as such currencies are freely transferable and convertible into
U.S. Dollars in the international interbank market and are traded and readily
available to each Lender in the London interbank market.
"Anicom Canada" means Anicom Multimedia Wiring Systems Incorporated, a
corporation organized under the laws of Nova Scotia, Canada.
"Applicable Margin" shall mean with respect to the Commitment Fee and
each type of Portion specified below the rate specified for such Obligation in
the chart below, subject to quarterly adjustment as hereinafter provided:
Applicable
Margin
For Domestic Applicable
When Following Status Rate Portion of Margin For Applicable
Exists For any Margin Revolving Loans LIBOR Margin
Determination Date Is: Portions of For Commitment
Revolving Loans Fee Is:
Is:
Level I Status 0% 1.00% .20%
Level II Status 0% 1.25% .25%
Level III Status 0% 1.50% .30%
Level IV Status 0.25% 2.00% .35%
Level V Status 0.50% 2.25% .40%
provided, however, that all of the foregoing percentages set forth in the chart
above are subject to the following:
(i) on or before the date that is ten (10) Business Days
after the latest date by which the Company is required to deliver a
Compliance Certificate to the Agent for a given quarterly accounting
period pursuant to Section 8.5(c) hereof (each date that is ten
Business Days after the latest date by which the Company is required to
deliver a Compliance Certificate to the Agent being herein referred to
as the "Margin Determination Date"), the Agent shall determine whether
Level I Status, Level II Status, Level III Status, Level IV Status or
Level V Status exists as of the close of the applicable quarterly
accounting period (each, a "quarterly test period") based upon such
Compliance Certificate and the financial statements delivered to the
Agent under Section 8.5 hereof for such quarterly test period, and
shall promptly notify the Company of such determination and of any
change in the Applicable Margin resulting therefrom;
(ii) any change in the Applicable Margin shall be effective as
of such Margin Determination Date, with such new Applicable Margin to
continue in effect until the next Margin Determination Date. If the
Company has not delivered a Compliance Certificate by the date such
Compliance Certificate is required to be delivered under Section 8.5
hereof, until a Compliance Certificate is delivered before the next
Margin Determination Date, the Applicable Margin shall be the
Applicable Margin for Level V Status. If the Company subsequently
delivers a Compliance Certificate before the next Margin Determination
Date, the Applicable Margin established by such Compliance Certificate
shall take effect from the date ten (10) Business Days after the date
of such delivery and remain effective until the next Margin
Determination Date; and
(iii) the initial Applicable Margin in effect through the first
Margin Determination Date occurring subsequent to June 30, 2000 shall
be the Applicable Margin for Level IV Status.
"Application" is defined in Section 1.3 hereof.
"Assignment Agreements" is defined in Section 11.10 hereof.
"Authorized Representative" means those persons shown on the list of
officers provided by the Company pursuant to Section 7.2(a) hereof or on any
update of any such list provided by the Company to the Agent, or any further or
different officer of the Company so named by any Authorized Representative of
the Company in a written notice to the Agent.
"Availability Reserve" is defined in the definition of the term
"Borrowing Base".
"Borrowing" means the total of Loans of a single type made to the
Company by all the Lenders on a single date, and if such Loans are to be part of
a LIBOR Portion, for a single Interest Period. Borrowings of Revolving Loans are
made and maintained ratably from each of the Lenders according to their
Percentages of the applicable Commitments. Borrowings of Swing Loans are made
from ▇▇▇▇▇▇ Bank in accordance with the procedures of Section 1.5 hereof.
"Borrowing Base" means, as of any time it is to be determined, the sum
of :
(a) 85% (or such lesser percentage as the Agent or the
Required Lenders may determine pursuant hereto) of the then outstanding
unpaid amount of Eligible Receivables (provided that in no event shall
more than $11,000,000 of the Borrowing Base under this clause (a) be
attributable to Eligible Receivables outstanding more than 90 days
after the date of the relevant invoice evidencing such Receivables);
plus
(b) 60% (or such lesser percentage as the Agent or the
Required Lenders may determine pursuant hereto) of the value (computed
at the lower of market or cost using the first-in/first-out method of
inventory valuation applied in accordance with GAAP) of Eligible
Inventory; plus
(c) 85% of the unpaid amount of the Fiscal Year 2000 Tax
Refund; minus
(d) the Rent Reserve as then in effect (provided that there
shall be no reduction in the Borrowing Base for the Rent Reserve until
March 1, 2000); minus
(e) $10,000,000 (such amount being herein referred to as
the "Availability Reserve");
provided that (i) the Borrowing Base shall be computed only as against and on so
much of the Collateral as is included on the Borrowing Base Certificates
furnished from time to time by the Company pursuant to the terms hereof and, if
required by the Agent or the Required Lenders pursuant to any of the terms
hereof or any Collateral Document, as verified by such other evidence reasonably
required to be furnished to the Agent or the Lenders pursuant hereto or pursuant
to any such Collateral Document and (ii) the Agent or the Required Lenders may
reduce the advance rates against Eligible Inventory and Eligible Receivables as
used in computing the Borrowing Base if the Agent or such Lenders in their
reasonable discretion exercised in good faith based upon the results of the
field audit referred to in Section 8.22(b) hereof that there has been a material
adverse change in circumstances relating to any or all of such Collateral from
those circumstances believed by the Agent or such Lenders to exist as of the
date of this Agreement; provided, however, that so long as no Event of Default
has occurred and is continuing, the Company shall not be required to make any
mandatory prepayment that would otherwise be required by Section 3.2(b)(iii)
hereof at any time during the first thirty (30) days immediately following the
effective date of any such reduction of the advance rates.
"Borrowing Base Certificate" means the certificate in the form of
Exhibit F hereto, or in such other form acceptable to the Agent, to be delivered
to the Agent and the Lenders pursuant to Section 8.5(a)(i) hereof.
"Business Day" means any day other than a Saturday or Sunday on which
banks are not authorized or required to close in Chicago, Illinois and, when
used with respect to LIBOR Portions, a day on which banks are also dealing in
U.S. Dollar deposits or the relevant Alternative Currency in London, England and
Nassau, Bahamas and if the applicable Business Day relates to the borrowing or
payment of a LIBOR Portion denominated in an Alternative Currency, on which
banks and foreign exchange markets are open for business in the city where
disbursements of or payments on such Portion are to be made.
"Canadian Dollar" means the lawful currency of Canada.
"Canadian Security Agreement" means that certain Security Agreement
dated the date of this Agreement from Anicom Canada to the Agent, as the same
may be amended, modified or supplemented from time to time.
"Capital Lease" means any lease of Property which in accordance with
GAAP is required to be capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligation" means the amount of the liability shown
on the balance sheet of any Person in respect of a Capital Lease determined in
accordance with GAAP.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto.
"Collateral" means all properties, rights, interests and privileges
from time to time subject to the Liens granted to the Agent, or any security
trustee therefor, by the Collateral Documents.
"Collateral Documents" means the Security Agreement, the Canadian
Security Agreement and all other security agreements, pledge agreements,
assignments, financing statements and other documents as shall from time to time
secure or relate to the Obligations or any part thereof.
"Company" is defined in the introductory paragraph hereof.
"Compliance Certificate" is defined in Section 8.5 hereof.
"Commitments" means and includes the Revolving Credit Commitments and
the Swing Line Commitment.
"Consolidated Net Income" means, for any period, the net income (or net
loss) of the Company and its Subsidiaries for such period computed on a
consolidated basis in accordance with GAAP, including without limitation
interest income and, without limiting the foregoing, after deduction from gross
income of all expenses and reserves, including reserves for all taxes on or
measured by income, but excluding any extraordinary profits and also excluding
any taxes on such profits.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Company or any of its Subsidiaries, are
treated as a single employer under Section 414 of the Code.
"Convertible Preferred Stock" shall mean the Series B Convertible
Preferred Stock issued by the Company on September 21, 1998.
"Debt to Earnings Ratio" means, as of any time the same is to be
determined, the ratio of Total Funded Debt at such time to EBITDA for the four
fiscal quarters of the Company then ended.
"Default" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.
"Deutsche ▇▇▇▇" means the lawful currency of the Federal Republic of
Germany.
"Disposition" means the lease, sale, conveyance or other disposition of
Property, other than sales or other dispositions expressly permitted under
Section 8.17 hereof.
"Domestic Rate" means, for any day, the greater of (i) the rate of
interest announced by the Agent from time to time as its prime commercial rate,
as in effect on such day (it being understood and agreed that such rate may not
be the Agent's best or lowest rate); and (ii) the sum of (x) the rate determined
by the Agent to be the average (rounded upwards, if necessary, to the next
higher 1/100 of 1%) of the rates per annum quoted to the Agent at approximately
10:00 a.m. (Chicago time) (or as soon thereafter as is practicable) on such day
(or, if such day is not a Business Day, on the immediately preceding Business
Day) by two or more Federal funds brokers selected by the Agent for the sale to
the Agent at face value of Federal funds in an amount equal or comparable to the
principal amount owed to the Agent for which such rate is being determined, plus
(y) 1/2 of 1%.
"Domestic Rate Portions" is defined in Section 2.1(a) hereof.
"EBIT" means, for any period, Consolidated Net Income for such period
plus all amounts deducted in arriving at such Consolidated Net Income amount for
such period for Interest Expense and for foreign, federal, state and local
income tax expense.
"EBITDA" means, for any period, EBIT for such period plus all amounts
deducted in arriving at such EBIT in respect of all amounts properly charged for
depreciation of fixed assets and amortization of Capital Leases and intangible
assets during such period on the books of the Company and its Subsidiaries, all
as determined in accordance with GAAP.
"Eligible Inventory" means any Inventory of the Company or any
Subsidiary in which the Agent has a perfected first priority security interest
and which complies with each of the following requirements:
(a) it consists of Inventory which is readily usable or
marketable by the Company or such
Subsidiary in the ordinary course of its business;
(b) it substantially conforms to such Person's advertised or
represented specifications, applicable government standards and
regulations and other quality standards and has not been determined by
the Agent to be unacceptable due to age, type, variety, quality,
quantity or location;
(c) it is not covered by a warehouse receipt or similar
document;
(d) all warranties of the Company or such Subsidiary in the
Loan Documents are true and correct with respect thereto;
(e) it has been identified to the Agent in the manner
required by the Agent pursuant to the Security Agreement; and
(f) it is located at a location disclosed to and approved by
the Agent, and if requested by the Agent, any Person (other than the
Company or such Subsidiary) owning or controlling such location shall
have waived all right, title and interest in and to such Inventory in a
manner satisfactory to the Agent.
"Eligible Receivables" means any Receivable of the Company or any
Subsidiary in which the Agent has a first priority perfected security interest
and which complies with each of the following requirements:
(a) it arises out of a bona fide sale of Inventory which has
been delivered to, or is in the process of being delivered to, the
account debtor on said Receivable in the ordinary course of business on
ordinary trade terms;
(b) all warranties of the Company or such Subsidiary in the
Loan Documents are true and correct with respect thereto;
(c) it has been identified to the Agent in the manner
required by the Agent pursuant to the Security Agreement;
(d) it is evidenced by an invoice to the account debtor
thereunder dated not more than 5 Business Days subsequent to the
shipment date of the relevant Inventory;
(e) it has not remained unpaid in whole or in part more than
90 days from and after the date of the relevant invoice evidencing such
Receivable (provided that such Receivable shall not be rendered
ineligible by this Subsection (e) if and so long as (i) the same has
not been unpaid more than 180 days from and after the date of the
relevant invoice evidencing such Receivable and such Receivable is
secured to the Agent's satisfaction by (i) a surety bond issued by a
reputable bonding company acceptable to the Agent securing its payment
or (ii) a statutory materialman's lien perfected to the extent required
by applicable law);
(f) it is net of any credit or allowance given by the Company
or such Subsidiary to such account debtor;
(g) it is not owing by an account debtor who (i) has become
insolvent, (ii) is the subject of any bankruptcy, arrangement,
reorganization proceedings or other proceedings for relief of debtors,
(iii) has admitted its inability to pay its debt generally or has
stopped paying its debts generally or (iv) is an Affiliate of the
Company or such Subsidiary;
(h) the account debtor is not principally located outside the
continental United States, Puerto Rico or Canada unless such Receivable
is secured by an irrevocable letter of credit issued by a commercial
bank located in the United States and which is on terms and conditions
acceptable to the Agent;
(i) it is not owing by the United States of America or any
department, agency or instrumentality thereof (including, without
limitation, the Commodity Credit Corporation) unless the Agent shall
have received evidence satisfactory to the Agent of compliance with the
Assignment of Claims Act;
(j) it is not owing by an account debtor who shall have
failed to pay 25% or more of all Receivables owed by such account
debtor (exclusive of any Receivables owing by such account debtor to
the extent the same are the subject of a bona fide dispute) within the
periods set forth in subsection (e) above;
(k) it is not subject to any counterclaim or defense asserted
by the account debtor thereunder, nor is it subject to any offset or
contra account payable to the account debtor (in any case, unless the
amount of such Receivable is net of such counterclaim, defense, offset
or contra account established to the satisfaction of the Agent); and
(l) it is not evidenced by an instrument or chattel paper
unless the same has been endorsed and delivered to the Agent.
"EMU" means economic and monetary union as contemplated in the Treaty
on European Union.
"EMU Commencement" means the date of commencement of the third stage of
EMU (which at the date hereof is expected to be on January 1, 1999) or the date
on which circumstances arise which (in the opinion of the Agent) have
substantially the same effect and result in substantially the same consequences
as commencement of the third stage of EMU as contemplated by the Treaty on
European Union.
"EMU Legislation" means legislative measures of the European Euro
Members of the European Union for the introduction of, changeover to or
operation of a single or unified European currency (whether known as the "euro"
or otherwise), being in part the implementation of the third stage of EMU.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute thereto.
"Euro" means the single currency of Euro Members of the European Union.
"Euro Member" means each state described as a "participating member
state" in any EMU Legislation.
"Euro Unit" means the currency unit of the Euro.
"Event of Default" means any event or condition identified as such in
Section 9.1 hereof.
"Existing Lenders" means ▇▇▇▇▇▇ Trust and Savings Bank, Bank One, NA
(f/k/a/ The First National Bank of Chicago), LaSalle Bank National Association
(f/k/a LaSalle National Bank) and Bank of America, N.A. (f/k/a Bank of America
National Trust and Savings Association).
"Existing Credit Agreements" means the Long-Term Multicurrency Credit
Agreement dated as of November 4, 1998, among the Company, ▇▇▇▇▇▇ Trust and
Savings Bank, as Agent and the Existing Lenders, as amended and supplemented and
the Short-Term Credit Agreement dated as of November 4, 1998, among the Company,
▇▇▇▇▇▇ Trust and Savings Bank, as Agent and the Existing Lenders, as amended and
supplemented.
"Fiscal Year 2000 Tax Refund" means an amount up to $7,665,000 of the
amount not yet received by the Company and shown on the Company's federal income
tax return for its fiscal year ended December 31, 1999, if the Agent has
received a letter addressed to the Agent and the Lenders from the Company's tax
preparer in form and substance satisfactory to the Agent confirming the
Company's reasonable expectation of receipt of the amount set forth on the
Company's tax return for fiscal 1999 to the; provided, however, that such amount
shall be deemed to be $0 on and at all times after January 1, 2001 or such
earlier date on which the Agent determines there remains no reasonable basis to
expect receipt of such.
"Fixed Rate Portion" means and includes the LIBOR Portions and the
Quoted Rate Portions and each individually, unless the context in which such
term is used shall otherwise require.
"French Franc" means the lawful currency of the Republic of France.
"GAAP" means generally accepted accounting principles as in effect from
time to time, applied by the Company and its Subsidiaries on a basis consistent
with the preparation of the Company's most recent financial statements furnished
to the Lenders pursuant to Section 6.5 hereof.
"Guarantor" means each Material Subsidiary (other than, subject to
Section 4.1, Anicom Canada) of the Company that executes and delivers to the
Agent a Guaranty Agreement.
"Guaranty Agreement" means each guaranty issued by a Material
Subsidiary to the Agent guaranteeing all or any Obligations.
"▇▇▇▇▇▇ Bank" means ▇▇▇▇▇▇ Trust and Savings Bank.
"Indebtedness for Borrowed Money" means for any Person (without
duplication) (i) all indebtedness created, assumed or incurred in any manner by
such Person representing money borrowed (including by the issuance of debt
securities), (ii) all indebtedness for the deferred purchase price of property
or services (other than trade accounts payable arising in the ordinary course of
business which are not more than sixty (60) days past due), (iii) all
indebtedness secured by any Lien upon Property of such Person, whether or not
such Person has assumed or become liable for the payment of such indebtedness,
(iv) all Capitalized Lease Obligations of such Person and (v) all obligations of
such Person on or with respect to letters of credit, bankers' acceptances and
other extensions of credit whether or not representing obligations for borrowed
money.
"Independent Collateral Report" means the monthly report of NCS
received by the Company setting forth the status of all surety bonds and
statutory materialmen's liens securing the Company's Receivables.
"Intangible Assets" means, as of any time the same is to be determined,
goodwill, patents, trademarks, copyrights and franchises of the Company and its
Subsidiaries (including, without limitation, unamortized debt discount and
expense, organization costs and deferred research and development expense)
determined on a consolidated basis in accordance with GAAP.
"Interest Expense" means, with reference to any period, the sum of all
interest charges (including imputed interest charges with respect to Capitalized
Lease Obligations and all amortization of debt discount and expense) of the
Company and its Subsidiaries for such period as computed on a consolidated basis
in accordance with GAAP.
"Interest Period" means, (i) with respect to any LIBOR Portion, the
period commencing on, as the case may be, the creation, continuation or
conversion date with respect to such LIBOR Portion and ending 1, 2, 3 or 6
months thereafter as selected by the Company in its notice as provided herein
and (ii) with respect to any Swing Loan, initially, the period commencing on, as
the case may be, the creation or conversion date with respect to such Swing Loan
and ending on the date, as the Company may select, 1-10 days thereafter, and
thereafter, each period commencing on the last day of the next preceding
interest period applicable to such Swing Loan and ending 1-10 days thereafter as
selected by the Company and in its notice as provided herein; provided that, all
of the foregoing provisions relating to Interest Periods are subject to the
following:
(i) if any Interest Period would otherwise end on a day which
is not a Business Day, that Interest Period shall be extended to the
next succeeding Business Day, unless in the case of an Interest Period
for a LIBOR Portion the result of such extension would be to carry such
Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding Business Day;
(ii) no Interest Period may extend beyond the final maturity
date of the relevant Notes;
(iii) the interest rate to be applicable to each Portion for
each Interest Period shall apply from and including the first day of
such Interest Period to but excluding the last day thereof; and
(iv) no Interest Period may be selected if after giving effect
thereto the Company will be unable to make a principal payment
scheduled to be made during such Interest Period without paying part of
a LIBOR Portion on a date other than the last day of the Interest
Period applicable thereto.
For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the month
in which an Interest Period is to end, then such Interest Period shall end on
the last Business Day of such month.
"Inventory" means all finished goods (other than packaging, crating,
and supplies inventory) held for sale in which the Company or the relevant
Subsidiary now has or hereafter acquires title to.
"Italian Lira" means the lawful currency of the Republic of Italy.
"Lender" means ▇▇▇▇▇▇ Trust and Savings Bank, the other signatories
hereto (other than the Company) and all other lenders becoming parties hereto
pursuant to Section 11.10 hereof.
"Letter of Credit" is defined in Section 1.3 hereof.
"Leverage Ratio" means, as of any time the same is to be determined,
the ratio of Total Funded Debt of the Company and its Subsidiaries to Total
Capitalization of the Company and its Subsidiaries, all as determined on a
consolidated basis in accordance with GAAP.
"Level I Status" shall mean, for any Margin Determination Date, that as
of the close of the quarterly test period with reference to which such Margin
Determination Date was set, the Pricing Leverage Ratio is less than or equal to
2.00 to 1.0.
"Level II Status" shall mean, for any Margin Determination Date, that
as of the close of the quarterly test period with reference to which such Margin
Determination Date was set, the Pricing Leverage Ratio is greater than 2.00 to
1.0 but less than or equal to 2.50 to 1.0.
"Level III Status" shall mean, for any Margin Determination Date, that
as of the close of the quarterly test period with reference to which such Margin
Determination Date was set, the Pricing Leverage Ratio is greater than 2.50 to
1.0 but less than or equal to 3.00 to 1.0.
"Level IV Status" shall mean, for any Margin Determination Date, that
as of the close of the quarterly test period with reference to which such Margin
Determination Date was set, the Pricing Leverage Ratio is greater than 3.00 to
1.0 and less than or equal to 3.50 to 1.0.
"Level V Status" shall mean, for any Margin Determination Date, that as
of the close of the quarterly test period with reference to which such Margin
Determination Date was set, the Pricing Leverage Ratio is greater than 3.50 to
1.0.
"LIBOR Portions" means and includes LIBOR Portions, unless the context
in which such term is used shall otherwise require.
"LIBOR Portions" is defined in Section 2.1(a) hereof.
"Lien" means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.
"Loan Documents" means this Agreement, the Notes, the Collateral
Documents, the Assignment Agreements and each other instrument or document to be
delivered hereunder or thereunder or otherwise in connection therewith.
"Loans" means and includes Revolving Loans and Swing Loans, and each of
them individually.
"Material Subsidiary" means any Subsidiary which has, as of the close
of any completed fiscal year of the Company (commencing with the Company's
fiscal year ending December 31, ▇▇▇▇), ▇▇▇▇▇▇ for any such fiscal year (directly
and together with its subsidiaries) greater than 7% of the EBITDA of the Company
and its Subsidiaries for any such fiscal year on a consolidated basis in
accordance with GAAP.
"Net Cash Proceeds" means, with respect to any offering of equity
securities of a Person or the issuance of any Indebtedness for Borrowed Money by
a Person, cash and cash equivalent proceeds received by or for such Person's
account, net of reasonable legal, underwriting, and other fees and expenses
incurred as a direct result thereof.
"Non-Material Subsidiary" means each Subsidiary other than a Material
Subsidiary.
"Notes" means and includes the Revolving Notes and the Swing Note and
each of them individually, unless the context in which such term is used shall
otherwise require.
"Obligations" means all obligations of the Company to pay principal and
interest on the Loans, all reimbursement obligations owing under the
Applications, all fees and charges payable hereunder, and all other payment
obligations of the Company arising under or in relation to any Loan Document, in
each case whether now existing or hereafter arising, due or to become due,
direct or indirect, absolute or contingent, and howsoever evidenced, held or
acquired.
"Original Dollar Amount" means at any time the same is to be determined
(x) in relation to any LIBOR Portion denominated in an Alternative Currency, the
U.S. Dollar Equivalent of such Portion on the first day of the Interest Period
then applicable thereto (the day on which such Portion was most recently
created, continued or effected by conversion) and (y) in relation to any other
Portion, the amount thereof in U.S. Dollars.
"Overnight Foreign Currency Rate" shall mean for any amount payable in
a currency other than U.S. Dollars, the rate of interest per annum as determined
by the Agent (rounded upwards, if necessary, to the nearest whole multiple of
one-sixteenth of one percent (1/16 of 1%)) at which overnight or weekend
deposits of the appropriate currency (or, if such amount due remains unpaid more
than three Business Days, then for such period of time not longer than six
months as the Agent may elect in its absolute discretion) for delivery in
immediately available and freely transferable funds would be offered by the
Agent to major banks in the interbank market upon request of such major banks
for the applicable period as determined above and in an amount comparable to the
unpaid principal amount of the related Revolving Loan (or, if the Agent is not
placing deposits in such currency in the interbank market, then the Agent's cost
of funds in such currency for such period).
"PBGC" means the Pension Benefit Guaranty Corporation or any Person
succeeding to any or all of its functions under ERISA.
"Percentage" means, for each Lender, the percentage of the Revolving
Credit Commitments represented by such Lender's Revolving Credit Commitment or,
if the Revolving Credit Commitments have been terminated, the percentage held by
such Lender (including through participation interest in Swing Loans pursuant to
Section 1.5 hereof and Letters of Credit pursuant to Section 1.3 hereof) of the
aggregate principal amount of all outstanding Obligations.
"Person" means an individual, partnership, corporation, association,
trust, unincorporated organization or any other entity or organization,
including a government or agency or political subdivision thereof.
"Plan" means any employee pension benefit plan covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the Code
that either (i) is maintained by a member of the Controlled Group for employees
of a member of the Controlled Group, or (ii) is maintained pursuant to a
collective bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which a member of the Controlled Group
is then making or accruing an obligation to make contributions or has within the
preceding five plan years made contributions.
"Portion" is defined in Section 2.1(a) hereof.
"Pounds Sterling" means the lawful currency of the United Kingdom.
"Pricing Leverage Ratio" means, as of any time the same is to be
determined, the ratio of (i) Total Funded Debt as of such date of determination
to (ii) EBITDA for the four most recently completed fiscal quarters of the
Company, all as determined on a consolidated basis in accordance with GAAP;
provided, however, that:
(a) the Pricing Leverage Ratio as of the close of the fiscal
quarter of the Company ending on June 30, 2000 shall mean the ratio of
(i) Total Funded Debt as of such date of determination to (ii) the
product which results by multiplying (x) EBITDA for the two fiscal
quarters of the Company then ended by (y) 2; and
(b) the Pricing Leverage Ratio as of the close of the fiscal
quarter of the Company ending on September 30, 2000 shall mean the
ratio of (i) Total Funded Debt as of such date of determination to (ii)
the product which results by multiplying (x) EBITDA for the three
fiscal quarters of the Company then ended by (y) 1.33.
"Property" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"Quoted Rate Portion" means any portion of the unpaid principal
balance of the Swing Note which bears interest with respect to ▇▇▇▇▇▇ Bank's
Offered Rate.
"Reimbursement Obligation" is defined in Section 1.4(c) hereof.
"Rent Reserve" means, as of any time, an amount (as determined by the
Agent) equal to the sum of the Company's rental expense for the next three
consecutive calendar months for each location at which more than $1,000,000 of
Inventory is located and for which the Company has not yet delivered to the
Agent a landlord's Lien waiver reasonably acceptable to the Agent in form and
substance as required by the terms of the Loan Documents.
"Required Lenders" means, as of the date of determinations thereof,
those Lenders holding at least 66-2/3% of the Revolving Credit Commitments or,
in the event that no Revolving Credit Commitments are outstanding hereunder,
holding at least 66-2/3% in aggregate principal amount of the Loans and credit
risk on the Letters of Credit outstanding hereunder.
"Revolving Credit" is defined in Section 1.1 hereof.
"Revolving Credit Commitments" means the commitments of the Lenders to
extend credit under the Revolving Credit in the amounts set forth opposite their
names on Schedule 1 attached hereto and made a part hereof and opposite their
signatures on Assignment Agreements delivered pursuant to Section 11.10 hereof
under the heading "Revolving Credit Commitment", as such amounts may be reduced
pursuant hereto.
"Revolving Loan" is defined in Section 1.2 hereof.
"Revolving Note" is defined in Section 1.2 hereof.
"Revolving Credit Termination Date" means July 1, 2001, or such earlier
date on which the Revolving Credit Commitments are terminated in whole pursuant
to Section 3.3, 9.2 or 9.3 hereof, or such later date to which the Revolving
Credit Termination Date is extended pursuant to Section 1.5 hereof.
"Security Agreement" means that certain Security Agreement dated the
date of this Agreement among the Company, the Guarantors (other than Anicom
Canada) and the Agent, as the same may be amended, modified, supplemented or
restated from time to time.
"Shareholders' Equity" means, as of any time the same is to be
determined, the sum (without duplication) of (i) shareholders' equity (including
all capital stock, additional paid-in-capital and retained earnings after
deducting treasury stock, but excluding minority interests in subsidiaries)
which would appear on the balance sheet of the Company and its Subsidiaries plus
(to the extent not included in such Shareholders' Equity) (ii) the Convertible
Preferred Stock, all as determined on a consolidated basis in accordance with
GAAP.
"SEC" means the Securities and Exchange Commission or any successor
agency thereto.
"Subordinated Indebtedness" means, as of any time the same is to be
determined, indebtedness of the Company or any Subsidiary subordinated in right
of payment to the Obligations, pursuant to documentation containing interest
rates, payment terms, maturities, amortization schedules, covenants, defaults,
remedies, subordination provisions and other material terms in form and
substance satisfactory to the Lenders. The Lenders further acknowledge and agree
that subordination provisions in the form or substantially the form annexed
hereto as Exhibit D constitute subordination provisions satisfactory in form and
substance to the Lenders.
"Subsidiary" means any corporation or other Person more than 50% of the
outstanding ordinary voting shares or other equity interests of which is at the
time directly or indirectly owned by the Company, by one or more of its
Subsidiaries, or by the Company and one or more of its Subsidiaries.
"Swing Line" is defined in Section 1.5(a) hereof.
"Swing Line Commitment" means the commitment of ▇▇▇▇▇▇ Bank to make
Swing Loans in the amount set forth opposite its name under the heading "Swing
Line Commitments" on Schedule 1 attached hereto and made a part hereof.
"Swing Loans" is defined in Section 1.5(a) hereof.
"Swing Note" is defined in Section 1.5(b) hereof.
"Tangible Net Worth" means, as of any time the same is to be
determined, Shareholders' Equity less the sum of (i) all notes receivable from
officers and employees of the Company and its Subsidiaries and (ii) Intangible
Assets.
"Texcan" means, collectively, Texcan Cables, Inc., a Nevada
corporation, Texcan Cables International, Inc., a Nevada corporation and Texcan
Cables Limited, a Canadian corporation.
"Texcan Acquisition" means the acquisition of all or substantially all
of the assets of Texcan by Anicom Canada on September 21, 1998 pursuant to that
certain Asset Purchase Agreement dated as of September 21, 1998 between the
Company, Anicom Canada and Texcan.
"Total Capitalization" means the sum of Total Funded Debt and
Shareholders' Equity.
"Total Funded Debt" means, at any time the same is to be determined,
the aggregate of all Indebtedness for Borrowed Money of the Company and its
Subsidiaries at such time, plus all Indebtedness for Borrowed Money of any other
Person which is directly or indirectly guaranteed by the Company or any of its
Subsidiaries or which the Company or any of its Subsidiaries has agreed
(contingently or otherwise) to purchase or otherwise acquire or in respect of
which the Company or any of its Subsidiaries has otherwise assured a creditor
against loss.
"Treaty on European Union" means the Treaty of Rome of March 25, 1957,
as amended by the Single European Act of 1986 and the Maastricht Treaty (which
was signed at Maastricht on February 7, 1992, and came into force on November 1,
1993, as amended from time to time).
"Unfunded Vested Liabilities" means, for any Plan at any time, the
amount (if any) by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents a
potential liability of a member of the Controlled Group to the PBGC or the Plan
under Title IV of ERISA.
"Unused Revolving Credit Commitments" means, at any time, the
difference between the Revolving Credit Commitments then in effect and the
aggregate outstanding Original Dollar Amount of Revolving Loans and Letters of
Credit.
"U.S. Dollars" and "$" means the lawful currency of the United States
of America.
"U.S. Dollar Equivalent" means the amount of U.S. Dollars which would
be realized by converting an Alternative Currency into U.S. Dollars in the spot
market at the exchange rate quoted by the Agent, at approximately 11:00 a.m.
(London time) two Business Days prior to the date on which a computation thereof
is required to be made, to major banks in the interbank foreign exchange market
for the purchase of U.S. Dollars for such Alternative Currency.
"Welfare Plan" means a "welfare plan" as defined in Section 3(1) of
ERISA.
"Wholly-Owned Subsidiary" means a Subsidiary of which all of the issued
and outstanding shares of capital stock (other than directors' qualifying shares
as required by law) or other equity interests are owned by the Company and/or
one or more Wholly-Owned Subsidiaries within the meaning of this definition.
"Year 2000 Problem" means any significant risk that computer hardware,
software, or equipment containing embedded microchips essential to the business
or operations of the Company or any of the Subsidiaries will not, in the case of
dates or time periods occurring after December 31, 1999, function at least as
efficiently and reliably as in the case of times or time periods occurring
before January 1, 2000, including the making of accurate leap year calculations.
Section 5.2. Interpretation. The foregoing definitions are equally
applicable to both the singular and plural forms of the terms defined. The words
"hereof", "herein", and "hereunder" and words of like import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement. All references to time of day herein are references
to Chicago, Illinois time unless otherwise specifically provided. Where the
character or amount of any asset or liability or item of income or expense is
required to be determined or any consolidation or other accounting computation
is required to be made for the purposes of this Agreement, it shall be done in
accordance with GAAP except where such principles are inconsistent with the
specific provisions of this Agreement.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to the Agent and the Lenders as
follows:
Section 6.1. Organization and Qualification. The Company is duly
organized, validly existing and in good standing as a corporation under the laws
of the State of Delaware, has full and adequate corporate power to own its
Property and conduct its business as now conducted, and is duly licensed or
qualified and in good standing in each jurisdiction in which the nature of the
business conducted by it or the nature of the Property owned or leased by it
requires such licensing or qualifying.
Section 6.2. Subsidiaries. Each Subsidiary is duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated or organized, as the case may be, has full and adequate power to
own its Property and conduct its business as now conducted, and is duly licensed
or qualified and in good standing in each jurisdiction in which the nature of
the business conducted by it or the nature of the Property owned or leased by it
requires such licensing or qualifying, except where the failure to obtain such
authorization, license or qualification would not result in a material adverse
change in the business, financial condition or Properties of the Company and its
Subsidiaries. Schedule 6.2 hereto identifies each Subsidiary, the jurisdiction
of its incorporation or organization, as the case may be, the percentage of
issued and outstanding shares of each class of its capital stock or other equity
interests owned by the Company and the Subsidiaries and, if such percentage is
not 100% (excluding directors' qualifying shares as required by law), a
description of each class of its authorized capital stock and other equity
interests and the number of shares of each class issued and outstanding. All of
the outstanding shares of capital stock and other equity interests of each
Subsidiary are validly issued and outstanding and fully paid and nonassessable
and all such shares and other equity interests indicated on Schedule 6.2 as
owned by the Company or a Subsidiary are owned, beneficially and of record, by
the Company or such Subsidiary free and clear of all Liens. There are no
outstanding commitments or other obligations of any Subsidiary to issue, and no
options, warrants or other rights of any Person to acquire, any shares of any
class of capital stock or other equity interests of any Subsidiary. Each
Subsidiary that is a Material Subsidiary is so noted on Schedule 6.2 hereto.
Each Material Subsidiary is a Guarantor except to the extent Section 4.1 or
Section 8.1(b) hereof does not yet require such Subsidiary to be a Guarantor.
Section 6.3. Corporate Authority and Validity of Obligations. (a) The
Company has full right and authority to enter into this Agreement and the other
Loan Documents, to make the borrowings herein provided for, to issue its Notes
in evidence thereof, to grant to the Agent the Liens described in the Collateral
Documents executed by the Company, and to perform all of its obligations
hereunder and under the other Loan Documents. The Loan Documents delivered by
the Company have been duly authorized, executed and delivered by the Company and
constitute valid and binding obligations of the Company enforceable in
accordance with their terms except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance or similar laws affecting
creditors' rights generally and general principles of equity (regardless of
whether the application of such principles is considered in a proceeding in
equity or at law); and this Agreement and the other Loan Documents do not, nor
does the performance or observance by the Company of any of the matters and
things herein or therein provided for, contravene or constitute a default under
any provision of law or any judgment, injunction, order or decree binding upon
the Company or any provision of the charter, articles of incorporation or
by-laws of the Company or any covenant, indenture or agreement of or affecting
the Company or any of its Properties, or result in the creation or imposition of
any Lien on any Property of the Company other than the Liens granted in favor of
the Agent pursuant to the Collateral Documents.
(b) Guarantors. Each Guarantor has full right and authority to enter
into any Loan Documents it has executed, to guarantee the Obligations of the
Company, to grant to the Agent the Liens described in the Collateral Documents
executed by such Person, and to perform all of its obligations thereunder. The
Loan Documents delivered by each Guarantor have been duly authorized, executed
and delivered by such Guarantor and constitute valid and binding obligations of
such Guarantor enforceable in accordance with their terms except as
enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance
or similar laws affecting creditors' rights generally and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law); and such Loan Documents do not, nor does
the performance or observance by such Guarantor of any of the matters and things
herein or therein provided for, contravene or constitute a default under any
provision of law or any judgment, injunction, order or decree binding upon the
Company or any Guarantor or any provision of the charter, articles of
incorporation or by-laws of the Company or any Guarantor or any covenant,
indenture or agreement of or affecting the Company or any Guarantor or any of
their Properties, or result in the creation or imposition of any Lien on any
Property of the Company or any Guarantor other than the Liens granted in favor
of the Agent pursuant to the Collateral Documents.
Section 6.4. Use of Proceeds; Margin Stock. The Company shall use the
proceeds of the Loans and other extensions of credit made available hereunder
solely for its general working capital purposes and for such other legal and
proper purposes as are consistent with all applicable laws. Neither the Company
nor any Subsidiary is engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning of Regulation
U of the Board of Governors of the Federal Reserve System), and no part of the
proceeds of any Loan or any other extension of credit made hereunder will be
used to purchase or carry any such margin stock or to extend credit to others
for the purpose of purchasing or carrying any such margin stock.
Section 6.5. Financial Reports. The consolidated balance sheet of the
Company and its Subsidiaries as at December 31, 1998, and the related
consolidated statements of income, retained earnings and cash flows of the
Company and its Subsidiaries for the fiscal year then ended, and accompanying
notes thereto, which financial statements are accompanied by the audit report of
PricewaterhouseCoopers LLP, independent public accountants, and the unaudited
interim consolidated balance sheet of the Company and its Subsidiaries as at
September 30, 1999, and the related consolidated statements of income and cash
flows of the Company and its Subsidiaries for the nine (9) months then ended,
heretofore furnished to the Lenders, fairly present the consolidated financial
condition of the Company and its Subsidiaries as at said dates and the
consolidated results of their operations and cash flows for the periods then
ended in conformity with generally accepted accounting principles applied on a
consistent basis. Neither the Company nor any Subsidiary has contingent
liabilities which are material to it other than as indicated on such financial
statements or, with respect to future periods, on the financial statements
furnished pursuant to Section 8.5 hereof.
Section 6.6. No Material Adverse Change. Since September 30, 1999,
there has been no change in the condition (financial or otherwise) or business
prospects of the Company or any Subsidiary except those occurring in the
ordinary course of business, none of which individually or in the aggregate have
been materially adverse.
Section 6.7. Full Disclosure. The statements and information furnished
to the Lenders in connection with the negotiation of this Agreement and the
other Loan Documents and the commitments by the Lenders to provide all or part
of the financing contemplated hereby do not contain any untrue statements of a
material fact or omit a material fact necessary to make the material statements
contained herein or therein not misleading, the Lenders acknowledging that as to
any projections furnished to Lenders, the Company only represents that the same
were prepared on the basis of information and estimates the Company believed to
be reasonable.
Section 6.8. Good Title. The Company and its Subsidiaries each have
good and defensible title to their assets as reflected on the most recent
consolidated balance sheet of the Company and its Subsidiaries furnished to the
Lenders (except for sales of assets by the Company and its Subsidiaries in the
ordinary course of business), subject to no Liens other than such thereof as are
permitted by Section 8.12 hereof.
Section 6.9. Litigation and Other Controversies. There is no litigation
or governmental proceeding or labor controversy pending, nor to the knowledge of
the Company threatened, against the Company or any Subsidiary which if adversely
determined would (a) impair the validity or enforceability of, or impair the
ability of the Company to perform its obligations under, this Agreement or any
other Loan Document or (b) result in any material adverse change in the
financial condition, Properties, business or operations of the Company or any
Subsidiary.
Section 6.10. Taxes. All tax returns required to be filed by the Company
or any Subsidiary in any jurisdiction have, in fact, been filed, and all taxes,
assessments, fees and other governmental charges upon the Company or any
Subsidiary or upon any of their respective Properties, income or franchises,
which are shown to be due and payable in such returns, have been paid. The
Company does not know of any proposed additional tax assessment against it or
its Subsidiaries for which adequate provision in accordance with GAAP has not
been made on its accounts. Adequate provisions in accordance with GAAP for taxes
on the books of the Company and each Subsidiary have been made for all open
years, and for its current fiscal period.
Section 6.11. Approvals. No authorization, consent, license, or
exemption from, or filing or registration with, any court or governmental
department, agency or instrumentality, nor any approval or consent of the
stockholders of the Company or any other Person, is or will be necessary to the
valid execution, delivery or performance by the Company of this Agreement or any
other Loan Document.
Section 6.12. Affiliate Transactions. Neither the Company nor any
Subsidiary is a party to any contracts or agreements with any of its Affiliates
(other than with Wholly-Owned Subsidiaries) on terms and conditions which are
less favorable to the Company or such Subsidiary than would be usual and
customary in similar contracts or agreements between Persons not affiliated with
each other.
Section 6.13. Investment Company; Public Utility Holding Company.
Neither the Company nor any Subsidiary is an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or a "public utility holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
Section 6.14. ERISA. The Company and each other member of its Controlled
Group has fulfilled its obligations under the minimum funding standards of and
is in compliance in all material respects with ERISA and the Code to the extent
applicable to it and has not incurred any liability to the PBGC or a Plan under
Title IV of ERISA other than a liability to the PBGC for premiums under Section
4007 of ERISA. Neither the Company nor any Subsidiary has any contingent
liabilities with respect to any post-retirement benefits under a Welfare Plan,
other than liability for continuation coverage described in article 6 of Title I
of ERISA.
Section 6.15. Compliance with Laws. The Company and each of its
Subsidiaries are in compliance with the requirements of all federal, state and
local laws, rules and regulations applicable to or pertaining to their
Properties or business operations (including, without limitation, the
Occupational Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, and laws and regulations establishing quality criteria and standards
for air, water, land and toxic or hazardous wastes and substances),
non-compliance with which could have a material adverse effect on the financial
condition, Properties, business or operations of the Company or any Subsidiary.
Neither the Company nor any Subsidiary has received notice to the effect that
its operations are not in compliance with any of the requirements of applicable
federal, state or local environmental, health and safety statutes and
regulations or are the subject of any governmental investigation evaluating
whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which non-compliance or
remedial action could have a material adverse effect on the financial condition,
Properties, business or operations of the Company or any Subsidiary.
Section 6.16. Other Agreements. Neither the Company nor any Subsidiary
is in default under the terms of any covenant, indenture or agreement of or
affecting the Company, any Subsidiary or any of their Properties, which default
if uncured would have a material adverse effect on the financial condition,
Properties, business or operations of the Company or any Subsidiary.
Section 6.17. No Default. No Default or Event of Default has occurred
and is continuing.
Section 6.18. Year 2000 Compliance. The Company and its Subsidiaries
have conducted a comprehensive review and assessment of their computer
applications, and have made such inquiry of their respective material suppliers,
service vendors (including data processors) and customers as the Company or
relevant Subsidiary (as the case may be) deem appropriate, with respect to any
defect in computer software, data bases, hardware, controls and peripherals
related to the occurrence of the year 2000 or the use of any date after December
31, 1999, in connection therewith. Based on the foregoing review, assessment and
inquiry, the Company believes that no such defect could reasonably be expected
to have a material adverse effect on the financial condition, Properties,
business or operations of the Company and its Subsidiaries taken as a whole.
SECTION 7. CONDITIONS PRECEDENT.
The obligation of the Lenders to make any Loan or of the Agent to issue
any Letter of Credit under this Agreement is subject to the following conditions
precedent:
Section 7.1. All Advances. As of the time of the making of each
extension of credit (including the initial extension of credit) hereunder:
(a) each of the representations and warranties set forth in
Section 6 hereof and in the other Loan Documents shall be true and
correct as of such time, except to the extent the same expressly relate
to an earlier date;
(b) the Company shall be in full compliance with all of the
terms and conditions of this Agreement and of the other Loan Documents,
and no Default or Event of Default shall have occurred and be
continuing or would occur as a result of making such extension of
credit;
(c) after giving effect to such extension of credit, (i)
neither the aggregate Original Dollar Amount nor the U.S. Dollar
Equivalent of all Loans (whether Revolving Loans or Swing Loans) and
Letters of Credit outstanding under this Agreement shall exceed the
lesser of the Borrowing Base as computed based on the most recent
Borrowing Base Certificate and the Revolving Credit Commitments then in
effect, (ii) the aggregate Original Dollar Amount of all Revolving
Loans denominated in Alternative Currencies shall not exceed
$15,000,000 and (iii) the aggregate Original Dollar Amount of Swing
Loans outstanding hereunder shall not exceed the lesser of the Unused
Revolving Credit Commitments or the Swing Line Commitment;
(d) in the case of the issuance of any Letter of Credit, the
Agent shall have received a properly completed Application therefor
together with the fees called for hereby; and
(e) such extension of credit shall not violate any order,
judgment or decree of any court or other authority or any provision of
law or regulation applicable to the Agent or any Lender (including,
without limitation, Regulation U of the Board of Governors of the
Federal Reserve System) as then in effect.
The Company's request for any Loan or Letter of Credit shall constitute its
warranty as to the facts specified in subsections (a) through (d), both
inclusive, above.
Section 7.2. Initial Advance. At or prior to the making of
the initial extension of credit hereunder, the following conditions precedent
shall also have been satisfied:
(a) the Agent shall have received the following for the
account of the Lenders (each to be properly executed and completed) and
the same shall have been approved as to form and substance by the
Agent:
(i) the Revolving Notes;
(ii) the Swing Note;
(iii) the Security Agreements;
(iv) the Guaranty Agreement;
(v) UCC Financing Statements to be filed against the
Company and each Subsidiary, as debtor, in favor of the Agent,
as secured party;
(vi) the Agent shall have received evidence of
insurance required to be maintained under the Loan Documents,
naming the Agent as loss payee;
(vii) copies (executed or certified, as may be
appropriate) of all legal documents or proceedings taken in
connection with the execution and delivery of this Agreement
and the other Loan Documents to the extent the Agent or its
counsel may reasonably request; and
(viii) an incumbency certificate containing the name,
title and genuine signatures of each of the Company's
Authorized Representatives.
(b) the Agent and the Lenders shall have received the initial
fees (if any) called for hereby;
(c) the Agent shall have received a Y2K Questionnaire in form
and substance acceptable to the Agent duly completed by the Company;
(d) each Lender shall have received such evaluations and
certifications as it may reasonably require (including a Borrowing Base
Certificate in the form attached hereto as Exhibit F, containing
calculations of the Borrowing Base and compliance calculations of the
financial covenants as of the date of this Agreement) in order to
satisfy itself as to the value of the Collateral, the financial
condition of the Company and its Subsidiaries, and the lack of material
contingent liabilities of the Company and its Subsidiaries;
(e) the Agent shall have received financing statement, tax
and judgment lien search results against the Property of the Company
and each Subsidiary evidencing the absence of Liens on its Property
except as permitted by Section 8.8 hereof;
(f) the Agent shall have received pay-off and lien release
letters from secured creditors of the Company and each Subsidiary
setting forth, among other things, the total amount of indebtedness
outstanding and owing to them (or outstanding letters of credit issued
for the account of the Company or any Subsidiary) and containing an
undertaking to cause to be delivered to the Agent UCC termination
statements and any other lien release instruments necessary to release
their Liens on the assets of the Company and each Subsidiary, which
pay-off and lien release letters shall be in form and substance
acceptable to the Agent;
(g) the Agent shall have received such assurances as it may
reasonably require in order to satisfy itself the Company and its
Subsidiaries are current in the payment of their rent expense;
(h) legal matters incident to the execution and delivery of
this Agreement and the other Loan Documents and to the transactions
contemplated hereby shall be satisfactory to each Lender and its
counsel; and the Agent shall have received for the account of the
Lenders the written opinion of counsel for the Company in form and
substance satisfactory to the Lender and its counsel; and
(i) the Agent shall have received for the account of the
Lenders such other agreements, instruments, documents, certificates and
opinions as the Agent or the Lenders may reasonably request.
Section 7.3. Termination of Existing Credit Agreements. Each of the
Company and the Existing Lenders consent to the termination of the "Revolving
Credit Commitments" under each Existing Credit Agreement effective on the date
the conditions set forth in Section 7.2 hereof are satisfied, notwithstanding
the notice requirements for such termination set forth in Section 3.3 of each
Existing Credit Agreement. The Existing Credit Agreements shall terminate and
all amounts payable thereunder, including accrued and unpaid facility fees
payable under Section 3.1 of each thereof, shall be payable, and the facility
fee payable under Section 3.1 hereof shall begin to accrue, on the date that
this Agreement has been executed by all the parties hereto and the conditions
set forth in Section 7.2 hereof have been satisfied.
SECTION 8. COVENANTS.
The Company agrees that, so long as any credit is available to or in
use by the Company hereunder, except to the extent compliance in any case or
cases is waived in writing by the Required Lenders:
Section 8.1. Corporate Existence; Subsidiaries. (a) The Company shall,
and shall cause each Subsidiary to, preserve and maintain its corporate
existence. The Company will preserve and keep in force and effect, and cause
each Subsidiary to preserve and keep in force and effect, all licenses, permits
and franchises necessary to the proper conduct of its business. Notwithstanding
anything contained herein to the contrary, so long as no Default or Event of
Default has occurred and is continuing, the Company may dissolve any
Non-Material Subsidiary so long as such dissolution would not result in a
material adverse change in the business, financial condition or Properties of
the Company and its Subsidiaries or impair the rights or benefits of the Lenders
under the Loan Documents.
(b) The Company shall cause each Material Subsidiary (other than,
subject to Section 4.1, Anicom Canada), whether now or hereafter existing, to
furnish the Agent (i) a Guaranty Agreement from such Material Subsidiary in the
form or substantially in the form attached hereto as Exhibit E hereto or in such
other form as is reasonably satisfactory to the Agent and the Required Lenders
as to form and substance, and (ii) documentation acceptable to the Agent similar
to in form and scope to that described in Sections 7.2(a)(ii), 7.2(a)(iii),
7.2(a)(iv), 7.2(c), 7.2(d) and 7.2(e) but relating to such Guarantor and its
Guaranty Agreement.
Section 8.2. Maintenance of Properties. The Company will maintain,
preserve and keep its Properties in good repair, working order and condition
(ordinary wear and tear excepted) and will from time to time make all needful
and proper repairs, renewals, replacements, additions and betterments thereto so
that at all times the efficiency thereof shall be fully preserved and
maintained, and will cause each Subsidiary to do so in respect of Property owned
or used by it.
Section 8.3. Taxes and Assessments. The Company will duly pay and
discharge, and will cause each Subsidiary to duly pay and discharge, all taxes,
rates, assessments, fees and governmental charges upon or against it or its
Properties, in each case before the same become delinquent and before penalties
accrue thereon, unless and to the extent that the same are being contested in
good faith and by appropriate proceedings which prevent enforcement of the
matter under contest and adequate reserves are provided therefor.
Section 8.4. Insurance. The Company will insure and keep insured, and
will cause each Subsidiary to insure and keep insured, with good and responsible
insurance companies, all insurable Property owned by it which is of a character
usually insured by Persons similarly situated and operating like Properties
against loss or damage from such hazards and risks, and in such amounts, as are
insured by Persons similarly situated and operating like Properties; and the
Company will insure, and cause each Subsidiary to insure, such other hazards and
risks (including employers' and public liability risks) with good and
responsible insurance companies as and to the extent usually insured by Persons
similarly situated and conducting similar businesses. The Company shall in any
event maintain, and cause each Subsidiary to maintain, insurance on the
Collateral to the extent required by the Collateral Documents. The Company will
upon request of the Agent and any Lender furnish a certificate setting forth in
summary form the nature and extent of the insurance maintained pursuant to this
Section.
Section 8.5. Financial Reports. (a) The Company will, and will cause
each Subsidiary to, maintain a standard system of accounting in accordance with
GAAP and will furnish to the Agent, each Lender and each of their duly
authorized representatives such information respecting the business and
financial condition of the Company and its Subsidiaries as the Agent or such
Lender may reasonably request; and without any request, will furnish to the
Lenders:
(i) as soon as available, and in any event within 15 Business
Days after the last day of each calendar month, a Borrowing Base
Certificate showing the computation of the Borrowing Base as of the
close of business on the last day of such month, prepared by the
Company and certified to by its chief financial officer or another
officer of the Company acceptable to the Agent, together with the
Independent Collateral Report for the same calendar month;
(ii) within 50 days after the end of each of the first three
quarterly fiscal periods of the Company, a copy of the Company's Form
10-Q Report filed with the SEC;
(iii) within 120 days after the end of each fiscal year of the
Company, a copy of the Company's Form 10-K Report filed with the SEC,
including a copy of the annual audit report of the Company and the
Subsidiaries for such year with accompanying financial statements,
prepared by the Company and certified by PricewaterhouseCoopers LLP or
any other independent public accountants of recognized national
standing selected by the Company and satisfactory to the Required
Lenders, in accordance with GAAP;
(iv) not later than 10 days after the receipt thereof, a copy
of any final management letters on internal accounting controls for the
Company or any Subsidiary prepared by its independent public
accountants;
(v) promptly after sending or filing thereof, copies of all
proxy statements, financial statements and reports which the Company
sends to its shareholders, and copies of all other regular, periodic
and special reports and all registration statements which the Company
files with the SEC or any successor thereto, or with any national
securities exchange;
(vi) promptly after knowledge thereof shall have come to the
attention of any responsible officer of the Company, written notice of
any threatened or pending litigation or governmental proceeding or
labor controversy against the Company or any Subsidiary which, if
adversely determined, would materially and adversely effect the
financial condition, Properties, business or operations of the Company
or any Subsidiary or of the occurrence of any Default or Event of
Default hereunder; and
(vii) as soon as possible and in any event within 10 days after
the date on which (X) a Non-Material Subsidiary becomes a Material
Subsidiary, (Y) the Company or any Subsidiary establishes or acquires
any Subsidiary or (Z) any Subsidiary is dissolved or otherwise merged
out of existence, the Company shall furnish the Lenders an updated
Schedule 6.2 reflecting such event.
(b) In the event the Company is no longer required to file Form 10-Q
and 10-K Reports with the SEC, the Company need not furnish such Reports to the
Lenders, but shall nonetheless provide the Lenders the financial statements
previously contained in such Reports by the times required by subsections (a)(i)
and (ii) above.
(c) Each of the financial statements furnished to the Lenders pursuant
to clauses (a) or (b) of this Section shall be accompanied by a written
certificate in the form attached hereto as Exhibit B (the "Compliance
Certificate") signed by the chief financial officer of the Company to the effect
that to the best of the chief financial officer's knowledge and belief no
Default or Event of Default has occurred during the period covered by such
statements or, if any such Default or Event of Default has occurred during such
period, setting forth a description of such Default or Event of Default and
specifying the action, if any, taken by the Company to remedy the same. Such
certificate shall also set forth the calculations supporting such statements in
respect of Sections 8.6, 8.7, 8.8, 8.9 and 8.10 of this Agreement.
Section 8.6. Minimum EBITDA. The Company shall, as of the last day of
each fiscal quarter of the Company specified below, maintain EBITDA for the four
fiscal quarters of the Company then ended in an amount not less than the amount
set forth below by such date:
EBITDA SHALL NOT BE
FISCAL QUARTER ENDING ON LESS THAN
December 31, 1999 $2,000,000
March 31, 2000 $20,000,000
June 30, 2000 $21,000,000
September 30, 2000 $24,000,000
December 31, 2000 $25,000,000
at all times thereafter $28,000,000
; provided, however, that for the purposes hereof, (a) EBITDA as of the close of
the fiscal quarter of the Company ending on December 31, 1999 shall be
calculated for the fiscal quarter of the Company then ended; (b) EBITDA as of
the close of the fiscal quarter of the Company ending on March 31, 2000 shall be
equal to the product of EBITDA for the fiscal quarter of the Company then ended
multiplied by 4; (c) EBITDA as of the close of the fiscal quarter of the Company
ending on June 30, 2000 shall be equal to the product of EBITDA for the two
fiscal quarters of the Company then ended multiplied by 2; and (d) EBITDA as of
the close of the fiscal quarter of the Company ended September 30, 2000 shall be
equal to the product of EBITDA for the three fiscal quarters of the Company then
ended multiplied by 1.33.
Section 8.7. Interest Coverage Ratio. The Company will, as of the last
day of each fiscal quarter of the Company (commencing with the fiscal quarter of
the Company ending on March 31, 2000), maintain the ratio (the "Interest
Coverage Ratio") of EBIT for the four fiscal quarters of the Company then ended
to Interest Expense for the same four fiscal quarters then ended of not less
than 2.0 to 1.0; provided, however,
(a) the Interest Coverage Ratio as of the close of the fiscal quarter
of the Company ending on March 31, 2000 shall be calculated for the fiscal
quarter of the Company then ended;
(b) the Interest Coverage Ratio as of the close of the fiscal quarter
of the Company ending on June 30, 2000 shall be calculated based upon the two
fiscal quarters of the Company then ended; and
(c) the Interest Coverage Ratio as of the close of the fiscal quarter
of the Borrower ending on September 30, 2000 shall be calculated based upon the
three fiscal quarters of the Company then ended
provided further that if an Acquisition permitted by Section 8.14 hereof occurs
at any time during such period, the Interest Coverage Ratio shall be calculated
on a pro forma basis to include the EBIT and Interest Expense of the Person or
assets so acquired for the entire period as if such Acquisition had taken place
on the first day of such period, all as reasonably calculated by the Company
(the expected cost savings relating to the EBIT of the Person or assets so
acquired may be incorporated in these calculations to the extent that the Agent
reasonably determines that they are readily quantifiable and verifiable, in a
manner consistent with the Company's prior pro forma calculations included with
SEC filings in connection with its prior acquisitions).
Section 8.8. Tangible Net Worth. The Company will, as of the last day
of each fiscal quarter of the Company, maintain Tangible Net Worth at not less
than the Minimum Required Amount. For purposes of this Section 8.8, the term
"Minimum Required Amount" shall mean, as of any time, the sum of: (i)
$30,000,000; plus (ii) fifty percent (50%) of Consolidated Net Income for each
fiscal quarter of the Company (if Consolidated Net Income for such fiscal
quarter is positive) completed on or after March 31, 2000. The Agent and the
Lenders hereby agree to distribute a copy of the field audit referred to in this
Section 8.22(b) to the Company.
Section 8.9. Debt to Earnings Ratio. The Company will, as of the last
day of each fiscal quarter of the Company (commencing with the fiscal quarter of
the Company ending on December 31, 2000, maintain the Debt to Earnings Ratio at
not greater than 4.5 to 1.0; provided, however, that if an Acquisition permitted
by Section 8.14 hereof occurs at any time during the four fiscal quarter period
over which EBITDA is measured to determine the Debt to Earnings Ratio, such Debt
to Earnings Ratio shall be calculated on a pro forma basis to include the EBITDA
of the Person or assets so required for the entire period as if such Acquisition
had taken place on the first day of such period, all as reasonably calculated by
the Company (the expected cost savings relating to the EBITDA of the Person or
assets so acquired may be incorporated in these calculations to the extent that
the Agent reasonably determines that they are readily quantifiable and
verifiable and based on reasonable assumptions).
Section 8.10. Leverage Ratio. The Company will, as of the last day of
each fiscal quarter of the Company, maintain the Leverage Ratio at not more than
0.40 to 1.00.
Section 8.11. Indebtedness for Borrowed Money. The Company will not, nor
will it permit any Subsidiary to, issue, incur, assume, create or have
outstanding any Indebtedness for Borrowed Money; provided, however, that the
foregoing provisions shall not restrict nor operate to prevent:
(a) the indebtedness of the Company on the Notes and other
Obligations;
(b) Capitalized Lease Obligations in an aggregate amount not
to exceed $1,500,000 at any one time outstanding;
(c) Capitalized Lease Obligations of any Subsidiary which has
become a Subsidiary as a result of an Acquisition permitted by Section
8.14 hereof if such Capitalized Lease Obligation was entered into prior
to the Acquisition of such Subsidiary and was not created in
contemplation of such Acquisition;
(d) purchase money indebtedness secured by Liens permitted by
Section 8.12(d) hereof in an aggregate amount not to exceed $2,000,000
at any one time outstanding;
(e) purchase money indebtedness (other than purchase money
indebtedness permitted by Section 8.11(d) hereof) of any Subsidiary
which has become a Subsidiary as a result of an Acquisition permitted
by Section 8.14 hereof if such indebtedness was created prior to the
Acquisition of such Subsidiary and was not created in contemplation of
such Acquisition;
(f) the currently outstanding indebtedness described on
Exhibit C hereof if and so long as such indebtedness is Subordinated
Indebtedness;
(g) unsecured Subordinated Indebtedness incurred to finance
Acquisitions permitted by Section 8.14 hereof;
(h) unsecured indebtedness of the Company to Finova Capital
in an aggregate principal amount not to exceed $5,000,000 at any one
time outstanding; and
(i) indebtedness not otherwise permitted by this Section
aggregating not more than $500,000 at any one time outstanding.
Section 8.12. Liens. The Company will not, nor will it permit any
Subsidiary to, create, incur or permit to exist any Lien of any kind on any
Property owned by the Company or any Subsidiary; provided, however, that this
Section shall not apply to nor operate to prevent:
(a) Liens arising by statute in connection with worker's
compensation, unemployment insurance, old age benefits, social security
obligations, taxes, assessments, statutory obligations or other similar
charges, good faith cash deposits in connection with tenders, contracts
or leases to which the Company or any Subsidiary is a party or other
cash deposits required to be made in the ordinary course of business,
provided in each case that the obligation is not for borrowed money and
that the obligation secured is not overdue or, if overdue, is being
contested in good faith by appropriate proceedings which prevent
enforcement of the matter under contest and adequate reserves have been
established therefor;
(b) mechanics', workmen's, materialmen's, landlords',
carriers', or other similar Liens arising in the ordinary course of
business with respect to obligations which are not due or which are
being contested in good faith by appropriate proceedings which prevent
enforcement of the matter under contest;
(c) the pledge of assets for the purpose of securing an
appeal, stay or discharge in the course of any legal proceeding,
provided that the aggregate amount of liabilities of the Company and
its Subsidiaries secured by a pledge of assets permitted under this
clause, including interest and penalties thereon, if any, shall not be
in excess of $1,000,000 at any one time outstanding;
(d) purchase money Liens securing indebtedness permitted by
Section 8.11(d) hereof in respect of equipment now owned or hereafter
acquired by the Company or any Subsidiary (not extending to any other
Property), or Liens on equipment so acquired (not extending to any
other Property) existing at the time of acquisition thereof, or
renewals, extensions and refundings of any such Liens (not extending to
any other Property), provided that the principal amount of indebtedness
secured by any such Lien shall not exceed 80% of the cost or fair
market value, whichever is less, of the Property covered by such Lien
at the time of the creation thereof or the acquisition of such
Property; and
(e) the Liens granted in favor of the Agent pursuant to the
Collateral Documents.
Section 8.13. Investments, Loans, Advances and Guaranties. The Company
will not, nor will it permit any Subsidiary to, directly or indirectly, make,
retain or have outstanding any investments (whether through purchase of stock or
obligations or otherwise) in, or loans or advances (other than for travel
advances and other similar cash advances made to employees in the ordinary
course of business) to, any other Person, or be or become liable as endorser,
guarantor, surety or otherwise for any debt, obligation or undertaking of any
other Person, or otherwise agree to provide funds for payment of the obligations
of another, or supply funds thereto or invest therein or otherwise assure a
creditor of another against loss or apply for or become liable to the issuer of
a letter of credit which supports an obligation of another, or subordinate any
claim or demand it may have to the claim or demand of any other Person;
provided, however, that the foregoing provisions shall not apply to nor operate
to prevent:
(a) investments in direct obligations of the United States of
America or of any agency or instrumentality thereof whose obligations
constitute full faith and credit obligations of the United States of
America, provided that any such obligations shall mature within one
year of the date of issuance thereof;
(b) investments in commercial paper (including as such,
investments in short-term corporate borrowings against tax-advantaged
preferred stock) rated at least P-1 by ▇▇▇▇▇'▇ Investors Services, Inc.
and at least A-1 by Standard & Poor's Corporation maturing within 270
days of the date of issuance thereof;
(c) investments in certificates of deposit issued by any
United States commercial Agent having capital and surplus of not less
than $100,000,000 which have a maturity of one year or less;
(d) endorsement of items for deposit or collection of
commercial paper received in the ordinary course of business;
(e) Acquisitions of Subsidiaries permitted by Section 8.14
hereof;
(f) investments in obligations of a state, a territory, or a
possession of the United States, or any political subdivision of any of
the foregoing or of the District of Columbia as described in Section
103(a) of the Code if these investments are graded in the highest major
grade as determined by at least one national rating service or are
credit enhanced by credit enhancers whose credit is rated not less than
A-1 by Standard & Poor's Corporation or P-1 by ▇▇▇▇▇'▇ Investors
Services, Inc.;
(g) the Company's guaranty of indebtedness of Wholly-Owned
Subsidiaries incurred to finance Acquisitions permitted by Section 8.14
hereof if and so long as such guaranty is Subordinated Indebtedness;
(h) guaranties by Subsidiaries of the Obligations; and
(i) investments, loans, advances and guarantees not otherwise
permitted by this Section aggregating not more than $3,000,000 at any
one time outstanding.
In determining the amount of investments, loans, advances and guarantees
permitted under this Section, investments shall always be taken at the original
cost thereof (regardless of any subsequent appreciation or depreciation
therein), loans and advances shall be taken at the principal amount thereof then
remaining unpaid and guarantees shall be taken at the amount of obligations
guaranteed thereby.
Section 8.14. Acquisitions. The Company will not, and will not permit
any Subsidiary to, make or commit to make any Acquisitions; provided however,
that the Company and any Wholly-Owned Subsidiary each may make Acquisitions if:
(i) the Company or such Subsidiary acquires by reason of such Acquisition either
(x) assets used or useful in a business which is the same or similar to that
currently conducted by the Company or (y) the capital stock of a corporation or
any other equity interest of any partnership or other firm engaged in such a
same or similar business and after giving effect to such Acquisition, the
corporation, partnership or other such firm so acquired becomes a Wholly-Owned
Subsidiary; (ii) no Default or Event of Default exists or would exist at the
time of or after giving effect to such Acquisition; (iii) the Company provides
the Lenders a statement, certified as true and correct by its chief financial
officer, which represents and warrants that, after giving effect to such
Acquisition, the Company will, on a pro forma basis, continue to comply through
the Termination Date with Sections 8.6, 8.7, 8.8, 8.9, 8.10 and 8.11 hereof,
such certificate to be accompanied by supporting financial projections based on
reasonable assumptions; (iv) the Board of Directors or other governing body of
such Person whose property or voting stock is being so acquired has approved the
terms of such Acquisition; and (v) the Company has provided the Lenders such
financial and other information regarding the Person whose property or voting
stock is being so acquired, including historical financial statements, and a
description of such Person, as the Agent or any Lender may reasonably request.
Section 8.15. Sales and Leasebacks. The Company will not, nor will it
permit any Subsidiary to, enter into any arrangement with any bank, insurance
company or any other lender or investor providing for the leasing by the Company
or any Subsidiary of any Property theretofore owned by it and which has been or
is to be sold or transferred by such owner to such lender or investor.
Section 8.16. Dividends and Certain Other Restricted Payments.
(a) Restricted Dividends. The Company will not during any fiscal year
declare or pay any dividends on or make any other distributions in respect of
any class or series of its capital stock (other than dividends payable solely in
its capital stock); provided that the foregoing shall not operate to prevent the
payment by the Company of dividends on its Convertible Preferred Stock to the
extent required by the terms of the Company's organizational documents as in
effect on the date hereof, so long as at the time of the making of each such
dividend and immediately after giving effect thereto, no Default or Event of
Default shall occur or be continuing.
(b) Restricted Repayments. The Company will not during any fiscal year
directly or indirectly purchase, redeem or otherwise acquire or retire any of
its capital stock (except out of the proceeds of, or in exchange for, a
substantially concurrent issue and sale of its capital stock); provided,
however, that the foregoing shall not operate to prevent the Company from
repurchasing its common stock or common stock options provided that at the time
of each such purchase and immediately after giving effect thereto, no Default or
Event of Default shall occur or be continuing.
Section 8.17. Mergers, Consolidations and Sales. The Company will not,
nor will it permit any Subsidiary to, be a party to any merger or consolidation,
or sell, transfer, lease or otherwise dispose of all or any substantial part of
its other Property, or in any event sell or discount (with or without recourse)
any of its notes or accounts receivable; provided, however, that this Section
shall not apply to nor operate to prohibit:
(i) the merger of any Subsidiary acquired as a result of an
Acquisition permitted by Section 8.14 hereof with and into the Company
or any Wholly-Owned Subsidiary;
(ii) the sale of assets which are no longer used or useful in
the ordinary course of the Company's business;
(iii) the sale or lease of inventory by the Company or any
Subsidiary in the ordinary course of business; and
(iv) the sale of delinquent notes or accounts receivable by
the Company or any Subsidiary in the ordinary course of business for
purposes of collection only (and not for the purpose of any bulk sale
or securitization transaction).
A sale or disposition of assets of the Company shall be deemed substantial for
the foregoing purposes (i) if such assets are sold below the book value of such
assets, and such assets constituted 10% or more of the total assets of the
Company or (ii) such assets constituted 20% or more of the total assets of the
Company.
Section 8.18. ERISA. The Company will, and will cause each Subsidiary
to, promptly pay and discharge all obligations and liabilities arising under
ERISA of a character which if unpaid or unperformed might result in the
imposition of a Lien against any of its Properties. The Company will, and will
cause each Subsidiary to, promptly notify the Agent of (i) the occurrence of any
reportable event (as defined in ERISA) with respect to a Plan, (ii) receipt of
any notice from the PBGC of its intention to seek termination of any Plan or
appointment of a trustee therefor, (iii) its intention to terminate or withdraw
from any Plan, and (iv) the occurrence of any event with respect to any Plan
which would result in the incurrence by the Company or any Subsidiary of any
material liability, fine or penalty, or any material increase in the contingent
liability of the Company or any Subsidiary with respect to any post-retirement
Welfare Plan benefit.
Section 8.19. Compliance with Laws. The Company will, and will cause
each Subsidiary to, comply in all respects with the requirements of all federal,
state and local laws, rules, regulations, ordinances and orders applicable to or
pertaining to the Properties or business operations of the Company or any
Subsidiary, non-compliance with which could have a material adverse effect on
the financial condition, Properties, business or operations of the Company or
any Subsidiary or could result in a Lien upon any of their Property.
Section 8.20. Burdensome Contracts With Affiliates. The Company will
not, nor will it permit any Subsidiary to, enter into any contract, agreement or
business arrangement with any of its Affiliates on terms and conditions which
are less favorable to the Company or such Subsidiary than would be usual and
customary in similar contracts, agreements or business arrangements between
Persons not affiliated with each other, other than any contract, agreement or
business arrangement with any Person which becomes a Subsidiary as a result of
an Acquisition permitted by Section 8.14 hereof after the date hereof if such
contract, agreement or arrangement was entered into prior to the acquisition of
such Subsidiary and such contract, agreement or arrangement was not created in
contemplation of such Acquisition.
Section 8.21. No Changes in Fiscal Year. Neither the Company nor any
Subsidiary will change its fiscal year from its present basis without the prior
written consent of the Agent.
Section 8.22. Inspection and Field Audit. (a) The Company will, and will
cause each Subsidiary to, permit the Agent and its duly authorized
representatives and agents to visit and inspect any of the Properties, corporate
books and financial records of the Company and each Subsidiary, to examine and
make copies of the books of accounts and other financial records of the Company
and each Subsidiary, and to discuss the affairs, finances and accounts of the
Company and each Subsidiary with, and to be advised as to the same by, its
officers and independent public accountants (and by this provision the Company
authorizes such accountants to discuss with the Agent the finances and affairs
of the Company and of each Subsidiary) with reasonable notice to the Company and
at such reasonable times and reasonable intervals as the Agent may designate.
After the occurrence of an Event of Default, the Company shall pay for all costs
and expenses incurred by the Agent in connection with any such visitation or
inspection; provided, however, that the Company shall be liable for such costs
and expenses prior to the occurrence of an Event of Default as set forth in
Section 3.1(d) hereof.
(b) Without limiting the generality of the foregoing, the Company shall
provide such access to its Properties, corporate books, financial records,
officers and accountants and such information regarding its Properties, business
and financial affairs as is in each case necessary to allow the orderly
completion of a field audit reasonably acceptable in scope and detail to the
Required Lenders and performed by a firm of independent auditors acceptable to
the Required Lenders commencing not later than February 25, 2000 and completed
not later than March 31, 2000.
Section 8.23. Formation of Subsidiaries. Except for existing
Subsidiaries designated on Schedule 6.2 hereto and Subsidiaries acquired in
Acquisitions or formed to effect Acquisitions in each case permitted by Section
8.14 hereof, the Company will not, and will not permit any Subsidiary to, form
or acquire any Subsidiary without the prior written consent of the Agent.
Section 8.24. Subordinated Indebtedness. The Company shall not, and
shall not permit any Subsidiary to:
(a) amend or modify any of the terms or conditions
relating to any Subordinated Indebtedness;
(b) make any voluntary prepayment on, or effect any voluntary
redemption of, any Subordinated Indebtedness (other than the prepayment
by Anicom Canada of certain indebtedness pursuant to the Put/Call
Agreement) if any Loans are outstanding at the time of or after giving
effect to such prepayment or redemption; or
(c) make any other payment on account of any Subordinated
Indebtedness which is prohibited under the terms of any instrument or
agreement subordinating such indebtedness to the Obligations.
Section 8.25. Use of Proceeds. The proceeds of the initial advance
hereunder shall be used to pay the Company's indebtedness under the Existing
Credit Agreement and the fees referred to in Section 7.2(b) hereof..
Section 8.26. Year 2000 Compliance. The Company shall take all actions
necessary and commit adequate resources to assure that its computer-based and
other systems (and those of all Subsidiaries) are able to effectively process
dates, including dates before, on and after January 1, 2000, without
experiencing any Year 2000 Problem that could cause a material adverse effect on
the business or financial affairs of the Company (or of the Company and its
Subsidiaries taken on a consolidated basis). At the request of the Agent, the
Company will provide the Agent with written assurances and substantiations
(including, but not limited to, the results of internal or external audit
reports prepared in the ordinary course of business) reasonably acceptable to
the Agent as to the capability of the Company and its Subsidiaries to conduct
its and their businesses and operations before, on and after January 1, 2000,
without experiencing a Year 2000 Problem causing a material adverse effect on
the business or financial affairs of the Company (or of the Company and its
Subsidiaries taken on a consolidated basis).
Section 8.27. European Monetary Union. (a) If, as a result of the EMU
Commencement, (i) any Alternative Currency ceases to be lawful currency of the
state issuing the same and is replaced by the Euro or (ii) any Alternative
Currency and the Euro are at the same time both recognized by the central bank
or comparable governmental authority of the state issuing such currency as
lawful currency of such state, then any amount payable hereunder by any party
hereto in such Alternative Currency (including, without limitation, any
Revolving Loan to be made under this Agreement) shall instead be payable in the
Euro and the amount so payable shall be determined by redenominating or
converting such amount into the Euro at the exchange rate officially fixed by
the European Central Bank for the purpose of implementing the EMU, provided,
that to the extent any EMU Legislation provides that an amount denominated
either in the Euro or in the applicable Alternative Currency can be paid either
in Euros or in the applicable Alternative Currency, each party to this Agreement
shall be entitled to pay or repay such amount in Euros or in the applicable
Alternative Currency. Prior to the occurrence of the event or events described
in clause (i) or (ii) of the preceding sentence, each amount payable hereunder
in any such Alternative Currency will, except as otherwise provided herein,
continue to be payable only in that Alternative Currency.
(b) The Company shall from time to time, at the request of the Agent,
pay to the Agent for the account of each Lender the amount of any cost or
increased cost incurred by, or of any reduction in any amount payable to or in
the effective return on its capital to, or of interest or other return foregone
by, such Lender or any holding company of such Lender as a result of the
introduction of, changeover to or operation of the Euro in any applicable state
to the extent attributable to such Lender's obligations hereunder or for the
credit which is the subject matter hereof.
(c) With respect to the payment of any amount denominated in the Euro
or in any Alternative Currency, the Agent shall not be liable to the Company or
any of the Lenders in any way whatsoever for any delay, or the consequences of
any delay, in the crediting to any account of any amount required by this
Agreement to be paid by the Agent if the Agent shall have taken all relevant
steps to achieve, on the date required by this Agreement, the payment of such
amount in immediately available, freely transferable, cleared funds (in the Euro
Unit or, as the case may be, in any Alternative Currency) to the account with
the bank in the principal financial center in the Euro Member which the Company
or, as the case may be, any Lender shall have specified for such purpose. In
this paragraph (c), "all relevant steps" means all such steps as may be
prescribed from time to time by the regulations or operating procedures of such
clearing or settlement system as the Agent may from time to time determine for
the purpose of clearing or settling payments of the Euro.
(d) If the basis of accrual of interest or fees expressed in this
Agreement with respect to the currency of any state that becomes a Euro Member
shall be inconsistent with any convention or practice in the London interbank
market for the basis of accrual of interest or fees in respect of the Euro, such
convention or practice shall replace such expressed basis effective as of and
from the date on which such state becomes a Euro Member; provided, that if any
Revolving Loan in the currency of such state is outstanding immediately prior to
such date, such replacement shall take effect, with respect to such Revolving
Loan, at the end of the then current Interest Period.
(e) In addition, this Agreement (including, without limitation, the
definition of LIBOR Portions) will be amended to the extent determined by the
Agent (acting reasonably and in consultation with the Company) to be necessary
to reflect such EMU Commencement and change in currency and to put the Lenders
and the Company in the same position, so far as possible, that they would have
been in if such implementation and change in currency had not occurred. Except
as provided in the foregoing provisions of this Section 8.27, no such
implementation or change in currency nor any economic consequences resulting
therefrom shall (i) give rise to any right to terminate prematurely, contest,
cancel, rescind, alter, modify or renegotiate the provisions of this Agreement
or (ii) discharge, excuse or otherwise affect the performance of any obligations
of the Company under this Agreement, any Notes or any other Loan Documents.
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.
Section 9.1. Events of Default. Any one or more of the following shall
constitute an "Event of Default" hereunder:
(a) default in the payment when due of all or any part of the
principal of or interest on any Note (whether at the stated maturity
thereof or at any other time provided for in this Agreement) or of any
reimbursement obligation owing under any Application or of any fee or
other Obligation payable by the Company hereunder or under any other
Loan Document; or
(b) default in the observance or performance of any covenant
set forth in Sections 8.5, 8.6, 8.7, 8.8, 8.9, 8.10, 8.11, 8.13, 8.14,
8.15, 8.16, 8.17, 8.24 or 8.25 hereof or of any provision in any Loan
Document dealing with the remittance to the Agent of the proceeds of
Collateral or requiring the maintenance of insurance thereon; or
(c) default in the observance or performance of any other
provision hereof or of any other Loan Document which is not remedied
within ten (10) days after the earlier of (i) the date on which such
failure shall first become known to any officer of the Company or (ii)
written notice thereof is given to the Company by the Agent or any
Lender; or
(d) any representation or warranty made by the Company herein
or in any other Loan Document, or in any statement or certificate
furnished by it pursuant hereto or thereto, or in connection with any
extension of credit made hereunder, proves untrue in any material
respect as of the date of the issuance or making thereof; or
(e) any event occurs or condition exists (other than those
described in subsections (a) through (d) above) which is specified as
an event of default under any of the other Loan Documents, or any of
the Loan Documents shall for any reason not be or shall cease to be in
full force and effect, or any of the Loan Documents is declared to be
null and void; or
(f) default shall occur under any Indebtedness for Borrowed
Money issued, assumed or guaranteed by the Company or any Subsidiary,
or under any indenture, agreement or other instrument under which the
same may be issued, and such default shall continue for a period of
time sufficient to permit the acceleration of the maturity of any such
Indebtedness for Borrowed Money (whether or not such maturity is in
fact accelerated), or any such Indebtedness for Borrowed Money shall
not be paid when due (whether by lapse of time, acceleration or
otherwise); or
(g) any judgment or judgments, writ or writs, or warrant or
warrants of attachment, or any similar process or processes in an
aggregate amount in excess of $1,000,000 in excess of amounts covered
by insurance from an insurer which has acknowledged its liability
thereon shall be entered or filed against the Company or any Subsidiary
or against any of their Property and which remains unvacated, unbonded,
unstayed or unsatisfied for a period of sixty (60) days; or
(h) the Company or any member of its Controlled Group shall
fail to pay when due an amount or amounts aggregating in excess
$500,000 which it shall have become liable to pay to the PBGC or to a
Plan under Title IV of ERISA; or notice of intent to terminate a Plan
or Plans having aggregate Unfunded Vested Liabilities in excess of
$500,000 (collectively, a "Material Plan") shall be filed under Title
IV of ERISA by the Company or any other member of its Controlled Group,
any plan administrator or any combination of the foregoing; or the PBGC
shall institute proceedings under Title IV of ERISA to terminate or to
cause a trustee to be appointed to administer any Material Plan or a
proceeding shall be instituted by a fiduciary of any Material Plan
against the Company or any member of its Controlled Group to enforce
Section 515 or 4219(c)(5) of ERISA and such proceeding shall not have
been dismissed within 30 days thereafter; or a condition shall exist by
reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or
(i) dissolution or termination of the existence of the
Company or any Subsidiary; or
(j) the Company or any Subsidiary shall (i) have entered
involuntarily against it an order for relief under the United States
Bankruptcy Code, as amended, (ii) not pay, or admit in writing its
inability to pay, its debts generally as they become due, (iii) make an
assignment for the benefit of creditors, (iv) apply for, seek, consent
to, or acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any substantial part
of its Property, (v) institute any proceeding seeking to have entered
against it an order for relief under the United States Bankruptcy Code,
as amended, to adjudicate it insolvent, or seeking dissolution, winding
up, liquidation, reorganization, arrangement, adjustment or composition
of it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors or fail to file an answer or other
pleading denying the material allegations of any such proceeding filed
against it, (vi) take any corporate action in furtherance of any matter
described in parts (i) through (v) above, or (vii) fail to contest in
good faith any appointment or proceeding described in Section 9.1(k)
hereof; or
(k) a custodian, receiver, trustee, examiner, liquidator or
similar official shall be appointed for the Company or any Subsidiary
or any substantial part of any of their Property, or a proceeding
described in Section 9.1(j)(v) shall be instituted against the Company
or any Subsidiary, and such appointment continues undischarged or such
proceeding continues undismissed or unstayed for a period of 60 days.
Section 9.2. Non-Bankruptcy Defaults. When any Event of Default
described in subsection (a) through (i), both inclusive, of Section 9.1 has
occurred and is continuing, the Agent shall, upon the request of the Required
Lenders, by notice to the Company, take one or more of the following actions:
(a) terminate the obligations of the Lenders to extend any
further credit hereunder on the date (which may be the date thereof)
stated in such notice;
(b) declare the principal of and the accrued interest on the
Notes to be forthwith due and payable and thereupon the Notes,
including both principal and interest and all fees, charges and other
Obligations payable hereunder and under the other Loan Documents, shall
be and become immediately due and payable without further demand,
presentment, protest or notice of any kind; and
(c) enforce any and all rights and remedies available to it
under the Loan Documents or applicable law.
Section 9.3. Bankruptcy Defaults. When any Event of Default described
in subsection (j) or (k) of Section 9.1 has occurred and is continuing, then the
Notes, including both principal and interest, and all fees, charges and other
Obligations payable hereunder and under the other Loan Documents, shall
immediately become due and payable without presentment, demand, protest or
notice of any kind, and the obligations of the Lenders to extend further credit
pursuant to any of the terms hereof shall immediately terminate. In addition,
the Agent may exercise any and all remedies available to it under the Loan
Documents or applicable law.
Section 9.4. Collateral for Undrawn Letters of Credit. When any Event
of Default, other than an Event of Default described in subsection (j) or (k) of
Section 9.1, has occurred and is continuing, the Company shall, upon demand of
the Agent (which demand shall be made upon the request of the Required Lenders),
and when any Event of Default described in subsection (j) or (k) of Section 9.1
has occurred the Company shall, without notice or demand from the Agent,
immediately pay to the Agent the full amount of each Letter of Credit then
outstanding, the Company agreeing to immediately make such payment and
acknowledging and agreeing that the Agent and the Lenders would not have an
adequate remedy at law for failure of the Company to honor any such demand and
that the Agent and the Lenders shall have the right to require the Company to
specifically perform such undertaking whether or not any draws have been made
under any such Letters of Credit.
SECTION 10. THE AGENT.
Section 10.1. Appointment and Authorization. Each Lender hereby appoints
and authorizes the Agent to take such action as agent on its behalf and to
exercise such powers hereunder and under the other Loan Documents as are
designated to the Agent by the terms hereof and thereof together with such
powers as are reasonably incidental thereto. The Lenders expressly agree that
the Agent is not acting as a fiduciary of the Lenders in respect of the Loan
Documents, the Company or otherwise, and nothing herein or in any of the other
Loan Documents shall result in any duties or obligations on the Agent or any of
the Lenders except as expressly set forth herein. The Agent may resign at any
time by sending 20 days prior written notice to the Company and the Lenders. In
the event of any such resignation, the Required Lenders may appoint a new agent
after consultation with the Company, which shall succeed to all the rights,
powers and duties of the Agent hereunder and under the other Loan Documents. Any
resigning Agent shall be entitled to the benefit of all the protective
provisions hereof with respect to its acts as an agent hereunder, but no
successor Agent shall in any event be liable or responsible for any actions of
its predecessor. If the Agent resigns and no successor is appointed, the rights
and obligations of such Agent shall be automatically assumed by the Required
Lenders and the Company shall be directed to make all payments due each Lender
hereunder directly to such Lender.
Section 10.2. Rights as a Lender. The Agent has and reserves all of the
rights, powers and duties hereunder and under the other Loan Documents as any
Lender may have and may exercise the same as though it were not the Agent and
the terms "Lender" or "Lenders" as used herein and in all of such documents
shall, unless the context otherwise expressly indicates, include the Agent in
its individual capacity as a Lender.
Section 10.3. Standard of Care. The Lenders acknowledge that they have
received and approved copies of the Loan Documents and such other information
and documents concerning the transactions contemplated and financed hereby as
they have requested to receive and/or review. The Agent makes no representations
or warranties of any kind or character to the Lenders with respect to the
validity, enforceability, genuineness, perfection, value, worth or
collectibility hereof or of the Notes or any of the other Obligations or of any
of the other Loan Documents. Neither the Agent nor any director, officer,
employee, agent or representative thereof (including any security trustee
therefor) shall in any event be liable for any clerical errors or errors in
judgment, inadvertence or oversight, or for action taken or omitted to be taken
by it or them hereunder or under the other Loan Documents or in connection
herewith or therewith except for its or their own gross negligence or willful
misconduct. The Agent shall incur no liability under or in respect of this
Agreement or the other Loan Documents by acting upon any notice, certificate,
warranty, instruction or statement (oral or written) of anyone (including anyone
in good faith believed by it to be authorized to act on behalf of the Company),
unless it has actual knowledge of the untruthfulness of same. The Agent may
execute any of its duties hereunder by or through employees, agents, and
attorneys-in-fact and shall not be answerable to the Lenders for the default or
misconduct of any such agents or attorneys-in-fact selected with reasonable
care. The Agent shall be entitled to advice of counsel concerning all matters
pertaining to the agencies hereby created and its duties hereunder, and shall
incur no liability to anyone and be fully protected in acting upon the advice of
such counsel. The Agent shall be entitled to assume that no Default or Event of
Default exists unless notified to the contrary by a Lender. The Agent shall in
all events be fully protected in acting or failing to act in accord with the
instructions of the Required Lenders. The Agent shall in all cases be fully
justified in failing or refusing to act hereunder unless it shall be indemnified
to its satisfaction by the Lenders against any and all liability and expense
which may be incurred by the Agent by reason of taking or continuing to take any
such action. The Agent may treat the owner of any Note as the holder thereof
until written notice of transfer shall have been filed with the Agent signed by
such owner in form satisfactory to the Agent. Each Lender acknowledges that it
has independently and without reliance on the Agent or any other Lender and
based upon such information, investigations and inquiries as it deems
appropriate made its own credit analysis and decision to extend credit to the
Company. It shall be the responsibility of each Lender to keep itself informed
as to the creditworthiness of the Company and the Agent shall have no liability
to any Lender with respect thereto. Upon the occurrence of an Event of Default,
the Agent shall take such action to enforce its Lien on the Collateral and to
preserve and protect the Collateral as may be directed by the Required Lenders.
The Agent hereby agrees to distribute to the Lenders the results of any field
audits conducted pursuant to Section 8.22 hereof.
Section 10.4. Costs and Expenses. Each Lender agrees to reimburse the
Agent for all costs and expenses suffered or incurred by the Agent or any
security trustee in performing its duties hereunder and under the other Loan
Documents, or in the exercise of any right or power imposed or conferred upon
the Agent hereby or thereby, to the extent that the Agent is not promptly
reimbursed for same by the Company, all such costs and expenses to be borne by
the Lenders ratably in accordance with the amounts of their respective Revolving
Credit Commitments.
Section 10.5. Indemnity. The Lenders shall ratably indemnify and hold
the Agent, and its directors, officers, employees, agents and representatives
(including as such any security trustee therefor) harmless from and against any
liabilities, losses, costs and expenses suffered or incurred by them hereunder
or under the other Loan Documents or in connection with the transactions
contemplated hereby or thereby, regardless of when asserted or arising, except
to the extent they are promptly reimbursed for the same by the Company and
except to the extent that any event giving rise to a claim was caused by the
gross negligence or willful misconduct of the party seeking to be indemnified.
SECTION 11. MISCELLANEOUS.
Section 11.1. Withholding Taxes.
(a) Payments Free of Withholding. Except as otherwise required by law
and subject to Section 11.1(b) hereof, each payment by the Company under this
Agreement and under any other Loan Document shall be made without withholding
for or on account of any present or future taxes (other than overall net income
taxes on the recipient) imposed by or within the jurisdiction in which the
Company is domiciled, any jurisdiction from which the Company makes any payment,
or (in each case) any political subdivision or taxing authority thereof or
therein. If any such withholding is so required, the Company shall make the
withholding, pay the amount withheld to the appropriate governmental authority
before penalties attach thereto or interest accrues thereon and forthwith pay
such additional amount as may be necessary to ensure that the net amount
actually received by each Lender and the Agent free and clear of such taxes
(including such taxes on such additional amount) is equal to the amount which
that Lender or the Agent (as the case may be) would have received had such
withholding not been made. If the Agent or any Lender pays any amount in respect
of any such taxes, penalties or interest, the Company shall reimburse the Agent
or such Lender for that payment on demand in the currency in which such payment
was made. If the Company pays any such taxes, penalties or interest, it shall
deliver official tax receipts evidencing that payment or certified copies
thereof to the Lender or Agent on whose account such withholding was made (with
a copy to the Agent if not the recipient of the original) on or before the
thirtieth day after payment.
(b) U.S. Withholding Tax Exemptions. Each Lender that is not a United
States person (as such term is defined in Section 7701(a)(30) of the Code) shall
submit to the Company and the Agent on or before the earlier of the date the
initial Borrowing is made hereunder and 30 days after the date hereof, two duly
completed and signed copies of either Form 1001 (relating to such Lender and
entitling it to a complete exemption from withholding under the Code on all
amounts to be received by such Lender, including fees, pursuant to the Loan
Documents and the Loans) or Form 4224 (relating to all amounts to be received by
such Lender, including fees, pursuant to the Loan Documents and the Loans) of
the United States Internal Revenue Service. Thereafter and from time to time,
each Lender shall submit to the Company and the Agent such additional duly
completed and signed copies of one or the other of such Forms (or such successor
forms as shall be adopted from time to time by the relevant United States taxing
authorities) as may be (i) requested by the Company in a written notice,
directly or through the Agent, to such Lender and (ii) required under
then-current United States law or regulations to avoid or reduce United States
withholding taxes on payments in respect of all amounts to be received by such
Lender, including fees, pursuant to the Loan Documents or the Loans.
(c) Inability of Lenders to Submit Forms. If any Lender determines, as
a result of any change in applicable law, regulation or treaty, or in any
official application or interpretation thereof, that it is unable to submit to
the Company or the Agent any form or certificate that such Lender is obligated
to submit pursuant to subsection (b) of this Section 11.1 or that such Lender is
required to withdraw or cancel any such form or certificate previously submitted
or any such form or certificate otherwise becomes ineffective or inaccurate,
such Lender shall promptly notify the Company and Agent of such fact and the
Lender shall to that extent not be obligated to provide any such form or
certificate and will be entitled to withdraw or cancel any affected form or
certificate, as applicable.
Section 11.2. Non-Business Days. If any payment hereunder becomes due
and payable on a day which is not a Business Day, the due date of such payment
shall be extended to the next succeeding Business Day on which date such payment
shall be due and payable. In the case of any payment of principal falling due on
a day which is not a Business Day, interest on such principal amount shall
continue to accrue during such extension at the rate per annum then in effect,
which accrued amount shall be due and payable on the next scheduled date for the
payment of interest.
Section 11.3. No Waiver, Cumulative Remedies. No delay or failure on the
part of any Lender or on the part of any holder of any of the Obligations in the
exercise of any power or right shall operate as a waiver thereof or as an
acquiescence in any default, nor shall any single or partial exercise of any
power or right preclude any other or further exercise thereof or the exercise of
any other power or right. The rights and remedies hereunder of the Lenders and
any of the holders of the Obligations are cumulative to, and not exclusive of,
any rights or remedies which any of them would otherwise have.
Section 11.4. Waivers, Modifications and Amendments. Any provision
hereof or of any of the other Loan Documents may be amended, modified, waived or
released and any Default or Event of Default and its consequences may be
rescinded and annulled upon the written consent of the Required Lenders;
provided, however, that without the consent of all Lenders no such amendment,
modification or waiver shall (i) increase the amount or extend the term of any
Lender's Revolving Credit Commitment (or, if relevant, Swing Line Commitment) or
(ii) reduce the amount of any principal of or interest rate applicable to, or
extend the maturity of, any Obligation owed to it or (iii) reduce the amount of
the fees to which it is entitled hereunder or (iv) change this Section or change
the definition of "Required Lenders" or (v) change the number of Lenders
required to take any action hereunder or under any of the other Loan Documents
or (vi) permit the Company to assign any of its rights hereunder or release any
Guarantor from its obligations under its Guaranty or (vii) release all or
substantially all of the Collateral (except as otherwise provided for in the
Loan Documents) or (viii) increase the advance rates against Eligible Inventory
and Eligible Receivables as used in computing the "Borrowing Base" or (ix)
change the definition of "Availability Reserve" or (x) waive compliance with the
provisions of Section 8.22(b) hereof. No amendment, modification or waiver of
the Agent's protective provisions shall be effective without the prior written
consent of the Agent.
Section 11.5. Costs and Expenses. The Company agrees to pay on demand
the costs and expenses of the Agent in connection with the negotiation,
preparation, execution and delivery of this Agreement, the other Loan Documents
and the other instruments and documents to be delivered hereunder or thereunder,
and in connection with the transactions contemplated hereby or thereby, and in
connection with any consents hereunder or waivers or amendments hereto or
thereto, including the fees and expenses of Messrs. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇, counsel
for the Agent, with respect to all of the foregoing (whether or not the
transactions contemplated hereby are consummated; provided, however, in no event
shall the Company's obligation to reimburse the Agent for such fees (exclusive
of such counsel's expenses and disbursements) in connection with the
negotiation, preparation, execution and delivery of this Agreement and the other
Loan Documents to be delivered as a condition precedent to initial funding of
the credit contemplated hereby exceed $35,000. The Company further agrees to pay
to Agent and the Lenders and any other holders of the Obligations all costs and
expenses (including court costs, the allocated costs of inhouse counsel and
outside attorneys' fees), if any, incurred or paid by the Agent, the Lenders or
any other holders of the Obligations in connection with any Default or Event of
Default or in connection with the enforcement of this Agreement or any of the
other Loan Documents or any other instrument or document delivered hereunder or
thereunder. The Company further agrees to indemnify and save the Lenders, the
Agent and any security trustee for the Lenders harmless from any and all
liabilities, losses, costs and expenses incurred by the Lenders or the Agent in
connection with any action, suit or proceeding brought against the Agent, or any
security trustee or any Lender by any Person (but excluding attorneys' fees for
litigation solely between the Lenders to which the Company is not a party) which
arises out of the transactions contemplated or financed hereby or out of any
action or inaction by the Agent, any security trustee or any Lender hereunder or
thereunder, except for such thereof as is caused by the gross negligence or
willful misconduct of the party seeking to be indemnified. The provisions of
this Section and the protective provisions of Section 2 hereof shall survive
payment of the Obligations.
Section 11.6. Documentary Taxes. The Company agrees to pay on demand any
documentary, stamp or similar taxes payable in respect of this Agreement or any
other Loan Document, including interest and penalties, in the event any such
taxes are assessed, irrespective of when such assessment is made and whether or
not any credit is then in use or available hereunder.
Section 11.7. Survival of Representations. All representations and
warranties made herein or in any of the other Loan Documents or in certificates
given pursuant hereto or thereto shall survive the execution and delivery of
this Agreement and the other Loan Documents, and shall continue in full force
and effect with respect to the date as of which they were made as long as any
credit is in use or available hereunder.
Section 11.8. Survival of Indemnities. All indemnities and other
provisions relative to reimbursement to the Agent and the Lenders of amounts
sufficient to protect the yield of the Agent and the Lenders with respect to the
Loans and Letters of Credit, including, but not limited to, Sections 1.3, 2.7,
and 2.9 hereof, shall survive the termination of this Agreement and the payment
of the Obligations.
Section 11.9. Participations. Any Lender may grant participations in its
extensions of credit hereunder to any other Lender or other lending institution
(a "Participant"), provided that (i) no Participant shall thereby acquire any
direct rights under this Agreement, (ii) no Lender shall agree with a
Participant not to exercise any of such Lender's rights hereunder without the
consent of such Participant except for rights which under the terms hereof may
only be exercised by all Lenders and (iii) no sale of a participation in
extensions of credit shall in any manner relieve the selling Lender of its
obligations hereunder.
Section 11.10. Assignment Agreements. Each Lender may, from time to time
upon at least 5 Business Days' prior written notice to the Agent, assign to
other commercial lenders part of its rights and obligations under this Agreement
(including without limitation the indebtedness evidenced by the Notes then owned
by such assigning Lender, together with an equivalent proportion of its
Revolving Credit Commitments to make Loans hereunder) pursuant to written
agreements executed by such assigning Lender, such assignee lender or lenders,
the Company and the Agent, which agreements shall specify in each instance the
portion of the indebtedness evidenced by the Notes which is to be assigned to
each such assignee lender and the portion of the Revolving Credit Commitments of
the assigning Lender to be assumed by it (the "Assignment Agreements");
provided, however, that (i) except with respect to Swing Loans (which must be
assigned in whole), each such assignment shall be of a constant, and not a
varying, percentage of the assigning Lender's rights and obligations under this
Agreement and the assignment shall cover the same percentage of such Lender's
Revolving Credit Commitments, Loans, Notes and credit risk with respect to
Letters of Credit; (ii) unless the Agent otherwise consents, the aggregate
amount of the Revolving Credit Commitments, Loans, Notes and credit risk with
respect to Letters of Credit of the assigning Lender being assigned pursuant to
each such assignment (determined as of the effective date of the relevant
Assignment Agreement) shall in no event be less than $5,000,000 (unless it
constitutes the assigning Lender's entire Revolving Credit Commitment) and shall
be an integral multiple of $1,000,000; (iii) the Agent and the Company must each
consent, which consent shall not be unreasonably withheld, to each such
assignment to a party which was not an original signatory of this Agreement or
an Affiliate thereof; and (iv) the assigning Lender must pay to the Agent a
processing and recordation fee of $3,000 and any out-of-pocket attorneys' fees
and expenses incurred by the Agent in connection with such Assignment Agreement.
Upon the execution of each Assignment Agreement by the assigning Lender
thereunder, the assignee lender thereunder, the Company and the Agent and
payment to such assigning Lender by such assignee lender of the purchase price
for the portion of the indebtedness of the Company being acquired by it, (i)
such assignee lender shall thereupon become a "Lender" for all purposes of this
Agreement with Revolving Credit Commitments (and, if relevant, shall be deemed
to be ▇▇▇▇▇▇ Bank for purposes of the Swing Loans) in the amounts set forth in
such Assignment Agreement and with all the rights, powers and obligations
afforded a Lender hereunder, (ii) such assigning Lender shall have no further
liability for funding the portion of its Revolving Credit Commitments (and, if
relevant, Swing Line Commitment) assumed by such other Lender and (iii) the
address for notices to such assignee Lender shall be as specified in the
Assignment Agreement executed by it. Concurrently with the execution and
delivery of such Assignment Agreement, the Company shall execute and deliver
Notes to the assignee Lender in the respective amounts of its Revolving Credit
Commitments under the Revolving Credit and new Notes to the assigning Lender in
the respective amounts of its Revolving Credit Commitments under the Revolving
Credit (and, if relevant, Swing Line Commitment) after giving effect to the
reduction occasioned by such assignment, all such Notes to constitute "Notes"
for all purposes of this Agreement and of the other Loan Documents.
Section 11.11. Notices. Except as otherwise specified herein, all notices
hereunder shall be in writing (including, without limitation, notice by
telecopy) and shall be given to the relevant party at its address or telecopier
number set forth below, in the case of the Company, or on the appropriate
signature page hereof, in the case of the Lenders and the Agent, or such other
address or telecopier number as such party may hereafter specify by notice to
the Agent and the Company given by United States certified or registered mail,
by telecopy or by other telecommunication device capable of creating a written
record of such notice and its receipt. Notices hereunder to the Company shall be
addressed to:
to the Company at:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (in case of notices of default) to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Zavis
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
to the Agent at:
▇▇▇▇▇▇ Trust and Savings Bank
▇.▇. ▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice, request or other communication shall be effective (i) if given
by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section and a confirmation of such telecopy has been received
by the sender, (ii) if given by mail, five (5) days after such communication is
deposited in the mail, certified or registered with return receipt requested,
addressed as aforesaid or (iii) if given by any other means, when delivered at
the addresses specified in this Section; provided that any notice given pursuant
to Section 1 or Section 2 hereof shall be effective only upon receipt.
Section 11.12. Construction. The parties hereto acknowledge and agree
that this Agreement and the other Loan Documents shall not be construed more
favorably in favor of one than the other based upon which party drafted the
same, it being acknowledged that all parties hereto contributed substantially to
the negotiation of this Agreement and the other Loan Documents. NOTHING
CONTAINED HEREIN SHALL BE DEEMED OR CONSTRUED TO PERMIT ANY ACT OR OMISSION
WHICH IS PROHIBITED BY THE TERMS OF ANY OF THE OTHER LOAN DOCUMENTS, THE
COVENANTS AND AGREEMENTS CONTAINED HEREIN BEING IN ADDITION TO AND NOT IN
SUBSTITUTION FOR THE COVENANTS AND AGREEMENTS CONTAINED IN THE OTHER LOAN
DOCUMENTS.
Section 11.13. Headings. Section headings used in this Agreement are
for convenience of reference only and are not a part of this Agreement for any
other purpose.
Section 11.14. Severability of Provisions. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction. All rights, remedies and powers provided in this Agreement and the
other Loan Documents may be exercised only to the extent that the exercise
thereof does not violate any applicable mandatory provisions of law, and all the
provisions of this Agreement and the other Loan Documents are intended to be
subject to all applicable mandatory provisions of law which may be controlling
and to be limited to the extent necessary so that they will not render this
Agreement or the other Loan Documents invalid or unenforceable.
Section 11.15 Counterparts. This Agreement may be executed in any number
of counterparts, and by different parties hereto on separate counterpart
signature pages, and all such counterparts taken together shall be deemed to
constitute one and the same instrument.
Section 11.16. Entire Understanding. This Agreement together with the
other Loan Documents constitute the entire understanding of the parties with
respect to the subject matter hereof and any prior agreements, whether written
or oral, with respect thereto are superseded hereby except for prior
understandings related to fees payable to the Agent upon the initial closing of
the transactions contemplated hereby.
Section 11.17. Currency. Each reference in this Agreement to U.S. Dollars
or to an Alternative Currency (the "relevant currency") is of the essence. To
the fullest extent permitted by law, the obligation of the Company in respect of
any amount due in the relevant currency under this Agreement shall,
notwithstanding any payment in any other currency (whether pursuant to a
judgment or otherwise), be discharged only to the extent of the amount in the
relevant currency that the Agent or Lender entitled to receive such payment may,
in accordance with normal banking procedures, purchase with the sum paid in such
other currency (after any premium and costs of exchange) on the Business Day
immediately following the day on which such party receives such payment. If the
amount in the relevant currency so purchased for any reason falls short of the
amount originally due in the relevant currency, the Company shall pay such
additional amounts, in the relevant currency, as may be necessary to compensate
for the shortfall. Any obligations of the Company not discharged by such payment
shall, to the fullest extent permitted by applicable law, be due as a separate
and independent obligation and, until discharged as provided herein, shall
continue in full force and effect.
Section 11.18. Currency Equivalence. If for the purposes of obtaining
judgment in any court it is necessary to convert a sum due from the Company on
the Obligations in the currency expressed to be payable herein or under the
Notes (the "specified currency") into another currency, the parties agree that
the rate of exchange used shall be that at which in accordance with normal
banking procedures the Agent could purchase the specified currency with such
other currency on the Business Day preceding that on which final judgment is
given. The obligation of the Company in respect of any such sum due to the Agent
or any Lender on the Obligations shall, notwithstanding any judgment in a
currency other than the specified currency, be discharged only to the extent
that on the Business Day following receipt by the Agent or such Lender, as
applicable, of any sum adjudged to be so due in such other currency, the Agent
or such Lender, as applicable, may in accordance with normal banking procedures
purchase the specified currency with such other currency. If the amount of the
specified currency so purchased is less than the sum originally due to the Agent
or such Lender in the specified currency, the Company agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify the Agent or such
Lender, as the case may be, against such loss, and if the amount of the
specified currency so purchased exceeds the amount originally due to the Agent
or such Lender in the specified currency, the Agent or such Lender, as the case
may be, agrees to remit such excess to the Company.
Section 11.19. Binding Nature, Governing Law, Etc. This Agreement shall
be binding upon the Company and its successors and assigns, and shall inure to
the benefit of the Agent and the Lenders and the benefit of their successors and
assigns, including any subsequent holder of an interest in the Obligations. The
Company may not assign its rights hereunder without the written consent of the
Lenders. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF THE PARTIES HERETO SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
ILLINOIS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
Section 11.20. Submission to Jurisdiction; Waiver of Jury Trial. The
Company hereby submits to the non-exclusive jurisdiction of the United States
District Court for the Northern District of Illinois and of any Illinois State
court sitting in the City of Chicago for purposes of all legal proceedings
arising out of or relating to this Agreement, the other Loan Documents or the
transactions contemplated hereby or thereby. The Company irrevocably waives, to
the fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum. THE COMPANY, THE AGENT, AND EACH LENDER HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY.
Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall constitute a contract between us for the uses and purposes
hereinabove set forth.
Dated as of this 17th day of December, 1999.
ANICOM, INC.
By
Name:_________________________________________________
Title:________________________________________________
Accepted and Agreed to at Chicago, Illinois as of the day and year last
above written.
Each of the Lenders hereby agrees with each other Lender that if it
should receive or obtain any payment (whether by voluntary payment, by
realization upon collateral, by the exercise of rights of set-off or banker's
lien, by counterclaim or cross action, or by the enforcement of any rights under
this Agreement, any of the other Loan Documents or otherwise) in respect of the
Obligations in a greater amount than such Lender would have received had such
payment been made to the Agent and been distributed among the Lenders as
contemplated by Section 3.4 hereof then in that event the Lender receiving such
disproportionate payment shall purchase for cash without recourse from the other
Lenders an interest in the Obligations of the Company to such Lenders in such
amount as shall result in a distribution of such payment as contemplated by
Section 3.4 hereof. In the event any payment made to a Lender and shared with
the other Lenders pursuant to the provisions hereof is ever recovered from such
Lender, the Lenders receiving a portion of such payment hereunder shall restore
the same to the payor Lender, but without interest.
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
By
Its Vice President
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
BANK ONE, NA (Main Office Chicago)
By
Its________________________________
1 Bank ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
LASALLE BANK NATIONAL ASSOCIATION
By
Its________________________________
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
BANK OF AMERICA, N.A.
By
Its________________________________
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Mr. ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
FIRSTAR BANK, N.A.
By
Its________________________________
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
FLEET CAPITAL CORPORATION
By
Its________________________________
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A-1
ANICOM, INC.
MULTICURRENCY REVOLVING CREDIT NOTE
Chicago, Illinois
--------------, ----
On the Revolving Credit Termination Date, for value received, the
undersigned, ANICOM, INC., a Delaware corporation (the "Company"), hereby
promises to pay to the order of ____________________ (the "Lender"), at the
principal office of ▇▇▇▇▇▇ Trust and Savings Bank in Chicago, Illinois (or in
the case of any LIBOR Portions denominated in an Alternative Currency, at such
office as the Agent has previously notified the Company in the currency of such
LIBOR Portions in accordance with Section 3.4 of the Credit Agreement), the
aggregate unpaid principal amount of all Loans owing from the Company to the
Lender under the Revolving Credit provided for in the Credit Agreement
hereinafter mentioned.
This Note evidences loans constituting part of a "Domestic Rate
Portion" and "LIBOR Portions" as such terms are defined in that certain
Multicurrency Credit Agreement dated as of December 17, 1999, by and among the
Company, ▇▇▇▇▇▇ Trust and Savings Bank, individually and as Agent thereunder,
and the other Lenders which are now or may from time to time hereafter become
parties thereto (said Credit Agreement, as the same may be amended, modified or
restated from time to time, being referred to herein as the "Credit Agreement")
made and to be made to the Company by the Lender under the Revolving Credit
provided for under the Credit Agreement, and the Company hereby promises to pay
interest at the office described above on each loan evidenced hereby at the
rates and at the times and in the manner specified therefor in the Credit
Agreement.
Each loan made under the Revolving Credit provided for in the Credit
Agreement by the Lender to the Company against this Note, any repayment of
principal hereon, the status of each such loan from time to time as part of the
Domestic Rate Portion or a LIBOR Portion and, in the case of any LIBOR Portion,
the currency thereof, the interest rate and Interest Period applicable thereto
shall be endorsed by the holder hereof on a schedule to this Note or recorded on
the books and records of the holder hereof (provided that such entries shall be
endorsed on a schedule to this Note prior to any negotiation hereof). The
Company agrees that in any action or proceeding instituted to collect or enforce
collection of this Note, the entries so endorsed on a schedule to this Note or
recorded on the books and records of the holder hereof shall be prima facie
evidence of the unpaid principal balance of this Note, the status of each such
loan from time to time as part of the Domestic Rate Portion or a LIBOR Portion,
and, in the case of any LIBOR Portion, the currency thereof, the interest rate
and Interest Period applicable thereto.
This Note is issued by the Company under the terms and provisions of
the Credit Agreement and is secured by, among other things, the Collateral
Documents, and this Note and the holder hereof are entitled to all of the
benefits and security provided for thereby or referred to therein, to which
reference is hereby made for a statement thereof. This Note may be declared to
be, or be and become, due prior to its expressed maturity, voluntary prepayments
may be made hereon, and certain prepayments are required to be made hereon, all
in the events, on the terms and with the effects provided in the Credit
Agreement. All capitalized terms used herein without definition shall have the
same meanings herein as such terms are defined in the Credit Agreement.
The Company hereby promises to pay all costs and expenses (including
attorneys' fees) suffered or incurred by the holder hereof in collecting this
Note or enforcing any rights in any collateral therefor. The Company hereby
waives presentment for payment and demand. THIS NOTE SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF ILLINOIS
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
ANICOM, INC.
By:
Name:______________________________
Title:_____________________________
EXHIBIT A-2
ANICOM, INC.
SWING LINE NOTE
Chicago, Illinois
-------------, ----
For value received, the undersigned, Anicom, Inc., a Delaware
corporation (the "Company"), hereby promises to pay to the order of
_____________________________ (the "Lender"), at the principal office of ▇▇▇▇▇▇
Trust and Savings Lender in Chicago, Illinois the aggregate unpaid principal of
all Swing Loans owing from the Company to the Lender under the Swing Line
provided for in the Credit Agreement hereinafter mentioned on the Revolving
Credit Termination Date.
This Note evidences Swing Loans made and to be made to the Company by
the Lender under the Swing Line Commitment provided for under that certain
Multicurrency Credit Agreement dated as of December 17, 1999, by and among the
Company, ▇▇▇▇▇▇ Trust and Savings Lender individually and as Agent and the other
Lenders which are now or may from time to time hereafter become parties thereto
said Credit Agreement, as the same may be amended, modified or restated from
time to time, being referred to herein as (the "Credit Agreement") made and to
be made to the Company by the Lender under the Swing Line provided for under the
Credit Agreement and the Company hereby promises to pay interest at the office
specified above on each loan evidenced hereby at the rates and times specified
therefor in the Credit Agreement. Capitalized terms used herein without
definition shall have the meanings ascribed to them in the Credit Agreement, and
this Note is subject to the terms of the Credit Agreement.
Each loan made under the Swing Line provided for in the Credit
Agreement by the Lender to the Company against this Note, any repayment of
principal hereon and the interest rates and interest periods applicable thereto
shall be endorsed by the holder hereof on the reverse side of this Note or
recorded on the books and records of the holder hereof (provided that such
entries shall be endorsed on the reverse side hereof prior to any negotiation
hereof) and the Company agrees that in any action or proceeding instituted to
collect or enforce collection of this Note, the entries so endorsed on the
reverse side hereof or recorded on the books and records of the Lender shall be
prima facie evidence of the unpaid balance of this Note and the interest rates
and interest periods applicable thereto.
This Note is issued by the Company under the terms and provisions of
the Credit Agreement and is secured by, among other things, the Collateral
Documents, and this Note and the holder hereof are entitled to all of the
benefits and security provided for thereby or referred to therein, equally and
ratably with all other indebtedness thereby secured, to which reference is
hereby made for a statement thereof. This Note may be declared to be, or be and
become, due prior to its expressed maturity upon the occurrence of an Event of
Default specified in the Credit Agreement, voluntary prepayments may be made
hereon, and certain prepayments are required to be made hereon, all in the
events, on the terms and with the effects provided in the Credit Agreement.
THE COMPANY HEREBY PROMISES TO PAY THE COSTS AND EXPENSES (INCLUDING
ATTORNEYS' FEES) SUFFERED OR INCURRED BY THE HOLDER THEREOF IN COLLECTING THIS
NOTE OR ENFORCING ANY COLLATERAL THEREFOR. THE COMPANY HEREBY WAIVES PRESENTMENT
FOR PAYMENT AND DEMAND. THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH, AND
GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF ILLINOIS WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAW.
ANICOM, INC.
By
Its______________________________
EXHIBIT B
COMPLIANCE CERTIFICATE
To: ▇▇▇▇▇▇ Trust and Savings Bank, as Agent under,
and the Lenders party to, the Credit Agreement
described below
This Compliance Certificate is furnished to the Agent and the Lenders
pursuant to that certain Multicurrency Credit Agreement dated as of December 17,
1999, by and among Anicom, Inc. (the "Company") and you (the "Credit
Agreement"). Unless otherwise defined herein, the 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 __________________________ 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 examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or the occurrence of any
event which constitutes a Default or Event of Default during or at the end of
the accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below;
4. The financial statements required by Section 8.5 of the Credit
Agreement and being furnished to you concurrently with this Certificate are
true, correct and complete as of the date and for the periods covered thereby;
and
5. The Attachment 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, to the best of my knowledge,
true, complete and correct and have been made in accordance with the relevant
Sections of the Credit Agreement.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking, or proposes to
take with respect to each such condition or event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The foregoing certifications, together with the computations set forth
in the Attachment hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this _________ day of
__________________ 19___.
-------------------------------------------
------------------------, ----------------
(Print or Type Name) (Title)
ATTACHMENT TO COMPLIANCE CERTIFICATE
ANICOM, INC.
Compliance Calculations for Multicurrency Credit Agreement
Dated as of December 17, 1999
Calculations as of _____________, 19___
--------------------------------------------------------------------------------
A. MINIMUM EBITDA (Section 8.6)
1. Consolidated Net Income as defined ___________
2. Amounts deducted in arriving at
Consolidated Net Income in respect of
(a) Interest Expense ___________
(b) Federal, state and local
income taxes ___________
(c) Depreciation of fixed assets and
amortization of Capital Leases and
intangible assets ___________
3. Sum of Lines 1, 2(a), 2(b) and 2(c)
("EBITDA") ___________
4. As listed in Section 8.6, for the date of
this certificate,
EBITDA shall not
be less than ___________
B. INTEREST COVERAGE RATIO (SECTION 8.7)
1. Consolidated Net Income as defined ___________
2. Amounts deducted in arriving at
Consolidated Net Income in respect of
(a) Interest Expense ___________
(b) Federal, state and local
income taxes ___________
3. Sum of Lines 1, 2(a) and 2(b)
("EBIT") ___________
4. Interest Expense ___________
5. Ratio of EBIT (Line 3)
to Interest Expense (Line 4) ("Interest
Coverage Ratio") :1
===========
6. As listed in Section 8.7, for the date
of this Certificate,
the Interest Coverage
Ratio shall not be less than 2.0 : 1
__________
7. Company is in compliance?
(Circle yes or no) Yes/No
===========
C. TANGIBLE NET WORTH (SECTION 8.8)
1. Shareholders' Equity __________
2. Less
(a) Notes receivable
from officers and
employees ____________
------------
(b) Intangible Assets ____________
3. Line 1 minus Lines 2(a) and 2(b)
("Tangible Net Worth") __________
4. As required by Section 8.8,
Tangible Net Worth must not be
less than Minimum Required Amount
(a) Consolidated Net Income ___________
(b) .50 X Line 4(a) ___________
(c) Line 4(b) plus the $__________ _________
Minimum Required
Amount for the immediately
preceding fiscal quarter
("Minimum Required Amount")
5. Company is in compliance?
(Circle yes or no) Yes/No
===========
D. DEBT TO EARNINGS RATIO (SECTION 8.9)
1. Total Funded Debt _________
2. EBITDA (Line A3 above) ___________
3. Ratio of Line 1 to Line 2
("Debt to Earnings Ratio") : 1
---------
4. As listed in Section 8.9,
Debt to Earnings Ratio
must not be greater than 4.5 : 1
---------
5. Company is in compliance?
(Circle yes or no) Yes/No
===========
E. LEVERAGE RATIO (SECTION 8.10)
1. Total Funded Debt ____________
2. Shareholders' Equity ____________
3. Line 1 plus Line 2 ____________
4. Total Capitalization
(from Line E3 above) ____________
5. Ratio of Line 1 to Line 4
("Leverage Ratio") :1
==============
7. As listed in Section 8.10, fo
the date of this Certificate,
the Leverage Ratio shall not
be greater than 0.40 :1
=============
8. Company is in compliance?
(Circle yes or no) Yes/No
=============
-------------------------------------------------------------------------------
EXHIBIT C
SUBORDINATED INDEBTEDNESS
INSTRUMENT INTEREST RATE BALANCE AS OF 6/30/98 MATURITY
Note payable
to ▇▇▇▇▇ ▇▇▇▇▇▇▇ prime $440,213 In monthly
installments
through July 1,
2002
EXHIBIT D
SUBORDINATION PROVISIONS APPLICABLE TO
SUBORDINATED DEBT
(a) The indebtedness evidenced by the subordinated notes* and any
renewals or extensions thereof (hereinafter called "Subordinated Indebtedness"),
shall at all times be wholly subordinate and junior in right of payment to any
and all credit and other indebtedness, obligations and liabilities of the
Company to the lenders (collectively the "Lenders") and their agent (each, an
"Agent") under or in connection with that certain Multicurrency Credit Agreement
dated as of December 17, 1999 by and among the Company, ▇▇▇▇▇▇ Trust and Savings
Bank, individually ("▇▇▇▇▇▇") and as Agent for the Lenders thereunder and other
Lenders from time to time party thereto, in each case howsoever evidenced,
whether now existing or hereafter created or arising, whether direct or
indirect, absolute or contingent, or joint or several, as any of the same may be
modified, supplemented or amended from time to time (hereinafter called
"Superior Indebtedness"), in the manner and with the force and effect hereafter
set forth:
(1) In the event of any liquidation, dissolution or winding
up of the Company of in the event of any execution sale, receivership,
insolvency, bankruptcy, liquidation, readjustment, reorganization or
other similar proceeding relative to the Company or its properties,
then in any such event the holders of any and all Superior Indebtedness
shall be preferred in the payment of their claims over the holder or
holders of the Subordinated Indebtedness, and such Superior
Indebtedness shall be first paid and satisfied in full before any
payment or distribution of any kind or character, whether in cash,
property or securities shall be made upon the Subordinated
Indebtedness; and in any such event any dividend or distribution of any
kind or character, whether in cash, property or securities which shall
be made upon or in respect of the Subordinated Indebtedness, or any
renewals or extensions hereof, shall be paid over to the holders of
such Superior Indebtedness, pro rata, for application in payment
thereof unless and until such Superior Indebtedness shall have been
paid and satisfied in full;
(2) Without limiting any of the other provisions hereof, in
the event that the Subordinated Indebtedness is declared or becomes due
and payable because of the occurrence of any event of default hereunder
(or under the agreement or indenture, as appropriate) or for any other
reason other than at the option of the Company, under circumstances
when the foregoing clause (1) shall not be applicable, the holders of
the Subordinated Indebtedness shall be entitled to payments only after
there shall first have been paid in full all Superior Indebtedness
outstanding at the time the Subordinated Indebtedness so becomes due
and payable because of any such event, or payment shall have been
provided for in a manner satisfactory to the holders of such Superior
Indebtedness;
(3) No payment on account of principal of, premium, if any,
or interest on the Subordinated Indebtedness shall be made, nor shall
any assets be applied to the purchase or other acquisition or
retirement of the Subordinated Indebtedness, unless full payment of
amounts then due on all Superior Indebtedness has been made or duly
provided for, and no payment on account of principal of, premium, if
any, or interest on the Subordinated Indebtedness shall be made, nor
shall any assets be applied to the purchase or other acquisition or
retirement of the Subordinated Indebtedness, if at the time of such
payment or application or immediately after giving effect thereto,
there shall exist a default in the payment of any amount due on any
Superior Indebtedness;
(4) If there shall have occurred a default (other than a
default in the payment of any amount due) with respect to any issue of
Superior Indebtedness, as defined therein or in the instrument under
which the same has been issued, permitting the holders thereof, after
notice or lapse of time, or both, to accelerate the maturity thereof,
and any such holders as constitute a sufficient number or hold a
sufficient amount of such Superior Indebtedness as to have the right to
so accelerate the maturity thereof (the "Notifying Debtholders") shall
give written notice of the default to the Company (a "Default Notice"),
then, unless and until such default shall have been cured or waived, no
payment on account of principal of, premium, if any, or interest on the
Subordinated Indebtedness shall be made, nor shall any assets be
applied to the purchase or other acquisition or retirement of the
Subordinated Indebtedness, at any time during the 180 days immediately
following the delivery of the Default Notice to the Company (the
"Blockage Period"); provided that if, during the Blockage Period the
Notifying Debtholders shall have accelerated the maturity of the
Superior Indebtedness held by such Notifying Debtholders, or shall have
taken such action as is necessary under the governing agreement or
instrument to accelerate the maturity of such Superior Indebtedness
(subject only to the expiration of a grace period not exceeding 30
days), then the Blockage Period shall be extended for any such grace
period and thereafter for so long as such acceleration shall continue
to be in effect and judicial proceedings shall be pending with respect
thereto, the Notifying Debtholders shall be in the process of
foreclosing or otherwise collecting or realizing on collateral for such
Superior Indebtedness or the Notifying Debtholders shall otherwise be
pursuing collection procedures in good faith. At the expiration of such
Blockage Period, (i) the Company shall, absent the occurrence prior to
payment thereof by the Company of any event set forth in Section 1 or 3
hereof, pay to the holders of the Subordinated Indebtedness all amounts
which would have been payable other than by reason of acceleration
during the Blockage Period and (ii) if the default referred to in the
Default Notice shall continue to exist and shall not have been waived,
then the Notifying Debtholders shall be permitted to submit a new
Default Notice respecting such event of default. If, during any
Blockage Period, a subsequent Default Notice is served respecting an
event or events of default which were in existence and known to such
Notifying Debtholder on the first day of the pre-existing Blockage
Period, then the Blockage period triggered by the subsequent Default
Notice shall terminate at the same time as the pre-existing Blockage
Period;
(5) Any holders of Subordinated Indebtedness shall not
without the prior written consent of the holders of the Superior
Indebtedness take any collateral for any Subordinated Indebtedness,
whether from the Company or any other party, nor take any guaranties
for any Subordinated Indebtedness, from any party, in each case if and
so long as the terms of any of the Superior Indebtedness prohibit such
liens or guaranties. Without limiting the effect of any of the other
provisions of this Agreement, any interest in or lien on any assets or
properties of the Company or any other party which may (notwithstanding
the foregoing agreement) be held or hereafter acquired by or on behalf
of any holder of Subordinated Indebtedness as security for any
Subordinated Indebtedness is and shall be absolutely and
unconditionally subject and subordinate in all respects to any security
interest or lien which may be held or hereafter acquired by or on
behalf of the holders of Superior Indebtedness in the same such assets
or properties as security for any Superior Indebtedness notwithstanding
the time of attachment of any interest therein or lien thereon or the
filing of any financing statement or any other priority provided by law
or by agreement; and
(6) The holders of Subordinated Indebtedness shall not take
any action to enforce collection of the Subordinated Indebtedness or to
foreclose or otherwise realize upon any security or guaranty given to
secure or guaranty the Subordinated Indebtedness and the Company and
any such guarantor shall not make any payment in respect of the
Subordinated Indebtedness, in each case during any Blockage Period, or
otherwise unless the Company shall, 180 days prior to the taking of any
such action, have provided the holders of Superior Indebtedness with
notice of the occurrence of the default giving rise to such action. Any
provisions of this Section 6 to the contrary notwithstanding, the
restriction contained in this Section shall no longer apply upon the
first to occur of the following: (i) the institution of bankruptcy
proceedings by or against the Company; (ii) the acceleration of the
Superior Indebtedness; or (iii) the payment or other satisfaction of
all of the Superior Indebtedness. The holders of the Subordinated
Indebtedness agree to accept a cure from the Lenders of any default
with respect to any Subordinated Indebtedness (with the same force and
effect as if such cure were timely provided by the Company or the
appropriate obligor) at any time during the period during which the
holders of the Subordinated Indebtedness agree not to act pursuant to
this Section and if any such default is cured during any such period
shall be rescinded and annulled all with the same effect as though such
default had not occurred and the rate of interest on such Subordinated
Indebtedness shall accrue during such period at the applicable
predefault rate.
(7) The holders of Subordinated Indebtedness undertake and
agree for the benefit of each holder of Superior Indebtedness to
execute, verify, deliver and file any proofs of claim, consents,
assignments or other instruments which any holder of Superior
Indebtedness may at any time require in order to prove and realize upon
any rights or claims pertaining to the subordinated notes and to
effectuate the full benefit of the subordination contained herein; and
upon failure of the holder of any subordinated note so to do, any such
holder of Superior Indebtedness shall be deemed to be irrevocably
appointed the agent and attorney-in-fact of the holder of such note to
execute, verify, deliver and file any such proofs of claim, consents,
assignments or other instrument.
(8) No right of any holder of any Superior Indebtedness to
enforce subordination as herein provided shall at any time or in any
way be affected or impaired by any failure to act on the part of the
Company or the holders of Superior Indebtedness, or by any
noncompliance by the Company with any of the terms, provisions and
covenants of the subordinated notes or the agreement under which they
are issued, regardless of any knowledge thereof that any such holder of
Superior Indebtedness may have or be otherwise charged with.
(9) The Company agrees, for the benefit of the holders of
Superior Indebtedness, that in the event that any subordinated note is
declared due and payable before its expressed maturity because of the
occurrence of a default hereunder, (i) the Company will provide prompt
notice in writing of such happening to the holders of Superior
Indebtedness and (ii) a holder of any Superior Indebtedness may declare
the same to be immediately due and payable, regardless of the expressed
maturity thereof.
(10) To the extent that the Company makes any payment on the
Superior Indebtedness which is subsequently invalidated, declared to be
fraudulent or preferential, set aside or is required to be repaid to a
trustee, receiver or any other party under any bankruptcy act, state or
Federal law, common law or equitable cause (such payment being
hereinafter referred to as a "Voided Payment"), then to the extent of
such Voided Payment that portion of the Superior Indebtedness which had
been previously satisfied by such Voided Payment shall be revived and
continue in full force and effect as if such Voided Payment has never
been made. In the event that a Voided Payment is recovered from the
holders of the Superior Indebtedness, a default in the payment of
Superior Indebtedness specified in paragraph (a)(3) of these
subordination provisions shall be deemed to have existed and to be
continuing from the date of the initial receipt by the holders of the
Superior Indebtedness of such Voided Payment until the full amount of
such Voided Payment is fully and finally restored to the holder of the
Superior Indebtedness and until such time these subordination
provisions shall be in full force and effect.
(11) In the event that any payment or distribution of assets
is made to any holder of subordinated notes in contravention of these
subordination provisions, such payment or distribution shall be
received and held by such holder in trust for the benefit of the
holders of the then outstanding Superior Indebtedness and shall,
forthwith upon receipt thereof, be paid or distributed to the holders
of the Superior Indebtedness, pro rata, for application in payment
thereof.
(12) The foregoing provisions are solely for the purpose of
defining the relative rights of the holders of Superior Indebtedness on
the one hand, and the holders of the Subordinated Indebtedness on the
other hand, and nothing herein shall impair, as between the Company and
the holders of the Subordinated Indebtedness, the obligation of the
Company, which is unconditional and absolute, to pay the principal of
and premium, if any, and interest on the Subordinated Indebtedness in
accordance with their terms, nor shall anything herein prevent the
holders of the Subordinated Indebtedness from exercising all remedies
otherwise permitted by applicable law or hereunder upon default
hereunder, subject to the rights of the holders of Superior
Indebtedness as herein provided for.
EXHIBIT E
GUARANTY
This Guaranty Agreement, dated as of ____________, ____, made by
____________ _________________________________, a _________________ organized
under the laws of _________________ (the "Guarantor");
WITNESSETH:
WHEREAS, Anicom, Inc., a Delaware corporation (the "Borrower"), ▇▇▇▇▇▇
Trust and Savings Bank ("▇▇▇▇▇▇"), individually and as Agent (▇▇▇▇▇▇ acting as
such agent and any successor or successors to ▇▇▇▇▇▇ in such capacity being
hereinafter referred to as the "Agent") and the lenders from time to time party
thereto (▇▇▇▇▇▇ and such other lenders being hereinafter referred to
collectively as the "Lenders" and individually as a "Lender") have entered into
a Multicurrency Credit Agreement dated as of December 17, 1999 (such Credit
Agreement as the same may from time to time hereafter be modified or amended
being hereinafter referred to as the "Credit Agreement") pursuant to which the
Lenders have extended various credit facilities to the Borrower (the Agent and
the Lenders being hereinafter referred to collectively as the "Guaranteed
Creditors" and individually as a "Guaranteed Creditor"); and
WHEREAS, the Borrower owns and holds all or substantially all of the
issued and outstanding common capital stock of the Guarantor; and
WHEREAS, it is a condition to the extension of credit by the Lenders
under the Credit Agreement that the Guarantor shall have executed and delivered
this Guaranty; and
WHEREAS, the Borrower has provided and will continue to provide the
Guarantor with business, technical and financial support beneficial to the
proper conduct of the Guarantor's business and the Guarantor will obtain
benefits as a result of the extensions of credit to the Borrower under the
Credit Agreement; and, accordingly, the Guarantor desires to enter into this
Guaranty in order to satisfy the condition described in the preceding paragraph;
and
NOW, THEREFORE, in consideration of the foregoing and other benefits
accruing to the Guarantor, the receipt and sufficiency of which are hereby
acknowledged, the Guarantor hereby makes the following representations and
warranties to the Guaranteed Creditors and hereby covenants and agrees with the
Guaranteed Creditors as follows:
1. The Guarantor hereby unconditionally and irrevocably guarantees to
the Guaranteed Creditors, the due and punctual payment of all present and future
indebtedness of the Borrower evidenced by or arising out of the Credit Documents
(as hereinafter defined), including, but not limited to, (a) the due and
punctual payment of principal of and interest on all notes issued by the
Borrower under the Credit Agreement and any and all notes issued in extension or
renewal thereof or in substitution or replacement therefor (collectively the
"Notes") as and when the same shall become due and payable, whether at stated
maturity, by acceleration or otherwise, and (b) the full and prompt performance
and payment when due of any and all other indebtedness, obligations and
liabilities, whether now existing or hereafter arising, of the Borrower to the
Guaranteed Creditors under or arising out of the Credit Agreement, the Notes,
Credit Agreement and each guaranty executed by another subsidiary of the
Borrower in connection with the Credit Agreement being hereinafter collectively
referred to as the "Credit Documents"). The indebtedness, obligations and
liabilities described in the immediately preceding clauses (a) and (b) are
hereinafter referred to as the "Guaranteed Obligations". In case of failure by
Borrower punctually to pay any indebtedness guaranteed hereby, the Guarantor
hereby unconditionally agrees to make such payment or to cause such payment to
be made punctually as and when the same shall become due and payable, whether at
stated maturity, by acceleration or otherwise, and as if such payment were made
by the Borrower.
2. The obligations of the Guarantor under this Guaranty shall be
unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver or
release in respect of any obligation of the Borrower or of any other
guarantor under the Credit Agreement or any other Credit Document or by
operation of law or otherwise;
(b) any modification or amendment of or supplement to the
Credit Agreement or any other Credit Document;
(c) any change in the corporate existence, structure or
ownership of (including any of the foregoing arising from any merger,
consolidation, amalgamation or similar transaction), or any insolvency,
bankruptcy, reorganization or other similar proceeding affecting, the
Borrower, any other guarantor, or any of their respective assets, or
any resulting release or discharge of any obligation of the Borrower or
of any other guarantor contained in any Credit Document (it being
understood and agreed that the term "Borrower" as used herein shall
mean and include any corporation, partnership, association or any other
entity or organization resulting from a merger, consolidation,
amalgamation or similar transaction involving the Borrower);
(d) the existence of any claim, set-off or other rights which
the Guarantor may have at any time against any Guaranteed Creditor or
any other person, whether or not arising in connection herewith;
(e) any failure to assert, or any assertion of, any claim or
demand or any exercise of, or failure to exercise, any rights or
remedies against the Borrower, any other guarantor, any other person or
any of their respective properties;
(f) any application of any sums by whomsoever paid or
howsoever realized to any obligation of the Borrower regardless of what
obligations of the Borrower remain unpaid;
(g) any invalidity or unenforceability relating to or against
the Borrower or any other guarantor for any reason of the Credit
Agreement or of any other Credit Document or any provision of
applicable law or regulation purporting to prohibit the payment by the
Borrower or any other guarantor of the principal of or interest on any
Note or any other amount payable by it under the Credit Documents; or
(h) any other act or omission to act or delay of any kind by
any Guaranteed Creditor or any other person or any other circumstance
whatsoever that might, but for the provisions of this paragraph,
constitute a legal or equitable discharge of the obligations of the
Guarantor hereunder.
In order to hold the Guarantor liable hereunder, there shall be no obligation on
the part of the Guaranteed Creditors, at any time, to resort for payment to the
Borrower or any other guarantor, or resort to any collateral, security,
property, liens or other rights or remedies whatsoever, and the Guaranteed
Creditors shall have the right to enforce this Guaranty irrespective of whether
or not other proceedings or steps seeking resort or realization upon or from any
of the foregoing are pending.
3. The Guarantor's obligations hereunder shall remain in full force
and effect until all commitments by the Guaranteed Creditors to extend credit to
the Borrower are terminated and the principal of and interest on the Notes and
all other amounts payable by the Borrower under the Credit Agreement and all
other Credit Documents shall have been paid in full. If at any time any payment
of the principal of or interest on any Note or any other amount payable by the
Borrower under the Credit Documents is rescinded or must be otherwise restored
or returned upon the insolvency, bankruptcy or reorganization of the Borrower or
of any other guarantor, or otherwise, the Guarantor's obligations hereunder with
respect to such payment shall be reinstated at such time as though such payment
had become due but had not been made at such time.
4. (a) The Guarantor irrevocably waives acceptance hereof,
presentment, demand, protest and any notice not provided for herein, as well as
any requirement that at any time any action be taken by the Agent, any Lender or
any other person against the Borrower, another guarantor or any other person.
(b) The Guarantor hereby agrees not to exercise or enforce any right of
exoneration, contribution, reimbursement, recourse or subrogation available to
the Guarantor against the Borrower or any other guarantor, or as to any security
therefor, unless and until all commitments by the Guaranteed Creditors to extend
credit to the Borrower are terminated and the principal of and interest on the
Notes and all other amounts payable by the Borrower under the Credit Agreement
and all other Credit Documents shall have been paid in full; and the payment by
the Guarantor of any of its obligations hereunder shall not in any way entitle
the Guarantor to any right, title or interest (whether by way of subrogation or
otherwise) in and to any of the Guaranteed Obligations or any proceeds thereof
or any security therefor unless and until all commitments by the Guaranteed
Creditors to extend credit to the Borrower are terminated and the principal of
and interest on the Notes and all other amounts payable by the Borrower under
the Credit Agreement and all other Credit Documents shall have been paid in
full.
5. Notwithstanding any other provision hereof, the right of recovery
of the Guaranteed Creditors against the Guarantor hereunder shall not exceed
$1.00 less than the amount which would render the Guarantor's obligations
hereunder void or voidable under applicable law, including without limitation
fraudulent conveyance law.
6. If acceleration of the time for payment of any amount payable by
the Borrower under the Credit Agreement or any other Credit Document is stayed
upon the insolvency, bankruptcy or reorganization of the Borrower, all such
amounts otherwise subject to acceleration under the terms of the Credit
Agreement or the other Credit Documents shall nonetheless be payable by the
Guarantor forthwith on demand by the Agent made at the request of the Guaranteed
Creditors.
7. Any payment of a Guaranteed Obligation required to be made pursuant
to this Guaranty shall be made in the currency which such Guaranteed Obligation
is required to be made in pursuant to the Credit Agreement or such other Credit
Document giving rise to such Guaranteed Obligation.
8. This Guaranty shall be binding upon the Guarantor and its
successors and assigns and shall inure to the benefit of the Guaranteed
Creditors and their successors and assigns. Any Guaranteed Creditor may, to the
extent permitted by the Credit Agreement, sell, transfer or assign its rights in
the Guaranteed Obligations held by it, or any part thereof, or grant
participations therein; and in that event, each and every immediate and
successive assignee or transferee of, or holder or participant in, all or any
part of the Guaranteed Obligations, shall have the right to enforce this
Guaranty, by suit or otherwise, for the benefit of such assignee, transferee,
holder or participant as fully as if such assignee or transferee, holder or
participant were herein by name specifically given such rights, powers and
benefits; but each Guaranteed Creditor shall have an unimpaired right to enforce
this Guaranty for its own benefit or for the benefit of any such participant as
to so much of the Guaranteed Obligations that it has not sold, assigned or
transferred.
9. The Guarantor acknowledges that executed (or conformed) copies of
the Credit Agreement and the other Credit Documents have been made available to
its principal executive officers and such officers are familiar with the
contents thereof.
10. Any acknowledgment or new promise, whether by payment of principal
or interest or otherwise and whether by the Borrower, or others (including the
Guarantor), with respect to any of the Guaranteed Obligations shall, if the
statute of limitations in favor of the Guarantor against the Guaranteed
Creditors shall have commenced to run, toll the running of such statute of
limitations, and if the period of such statute of limitations shall have
expired, prevent the operation of such statute of limitations.
11. The records of the Agent and each Lender as to the unpaid balance
of the Guaranteed Obligations at any time and from time to time shall be prima
facie evidence thereof without further or other proof for all purposes,
including the enforcement of this Guaranty and any collateral therefor.
12. Except as otherwise required by law, each payment by the Guarantor
hereunder shall be made without withholding for or on account of any present or
future taxes (other than overall net income taxes on the recipient) imposed by
or within the jurisdiction in which the Guarantor is domiciled, any jurisdiction
from which the Guarantor makes any payment, or (in each case) any political
subdivision or taxing authority thereof or therein. If any such withholding is
so required, the Guarantor shall make the withholding, pay the amount withheld
to the appropriate governmental authority before penalties attach thereto or
interest accrues thereon and forthwith pay such additional amount as may be
necessary to ensure that the net amount actually received by each Guaranteed
Creditor free and clear of such taxes (including such taxes on such additional
amount) is equal to the amount which that Guaranteed Creditor would have
received had such withholding not been made. If any Guaranteed Creditor pays any
amount in respect of any such taxes, penalties or interest the Guarantor shall
reimburse the Guaranteed Creditor for that payment on demand in the currency in
which such payment was made. If the Guarantor pays any such taxes, penalties or
interest, it shall deliver official tax receipts evidencing that payment or
certified copies thereof to the Guaranteed Creditor on whose account such
withholding was made (with a copy to the Agent if not the recipient of the
original) on or before the thirtieth day after payment. If any Guaranteed
Creditor determines it has received or been granted a credit against or relief
or remission for, or repayment of, any taxes paid or payable by it because of
any taxes, penalties or interest paid by the Guarantor and evidenced by such a
tax receipt, such Guaranteed Creditor shall, to the extent it can do so without
prejudice to the retention of the amount of such credit, relief, remission or
repayment, pay to the Guarantor as applicable, such amount as such Guaranteed
Creditor determines is attributable to such deduction or withholding and which
will leave such Guaranteed Creditor (after such payment) in no better or worse
position than it would have been in if the Guarantor had not been required to
make such deduction or withholding. Nothing herein shall interfere with the
right of each Guaranteed Creditor to arrange its tax affairs in whatever manner
it thinks fit nor oblige any Guaranteed Creditor to disclose any information
relating to its tax affairs or any computations in connection with such taxes.
13. Each reference in the Credit Agreement or any other Credit Document
to U.S. Dollars or to an alternative currency (the "relevant currency") is of
the essence. To the fullest extent permitted by law, the obligation of the
Guarantor in respect of any amount due in the relevant currency under the Credit
Agreement shall, notwithstanding any payment in any other currency (whether
pursuant to a judgment or otherwise), be discharged only to the extent of the
amount in the relevant currency that the Guaranteed Creditor entitled to receive
such payment may, in accordance with normal banking procedures, purchase with
the sum paid in such other currency (after any premium and costs of exchange) on
the business day immediately following the day on which such Guaranteed Creditor
receives such payment. If the amount of the relevant currency so purchased is
less than the sum originally due to such Guaranteed Creditor in the relevant
currency, the Guarantor agrees, as a separate obligation and notwithstanding any
such judgment, to indemnify such Guaranteed Creditor against such loss, and if
the amount of the specified currency so purchased exceeds the sum of (a) the
amount originally due to the relevant Guaranteed Creditor in the specified
currency plus (b) any amounts shared with other Guaranteed Creditors as a result
of allocations of such excess as a disproportionate payment to such Guaranteed
Creditor under Section 3.4 of the Credit Agreement, such Guaranteed Creditor
agrees to remit such excess to the Guarantor.
14. THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE
STATE OF ILLINOIS (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS), in which
State it shall be performed by the Guarantor.
15. The obligation of the Guarantor hereunder shall be absolute and
unconditional under all circumstances and irrespective of the validity or the
enforceability of the Guaranteed Obligations and irrespective of any present or
future law of any government or of any agency thereof purporting to reduce,
amend or otherwise affect any of the Guaranteed Obligations. To the extent that
the Guarantor or any of its properties or revenues has or hereafter may acquire
any right of immunity from suit, judgment or execution, the Guarantor hereby
irrevocably waives such right of immunity in respect of its obligations
hereunder and in respect of any action or proceeding, wherever brought, to
enforce any judgment against the Guarantor for breach of any of such
obligations.
16. The Guarantor hereby submits to the nonexclusive jurisdiction of
the United States District Court for the Northern District of Illinois and of
any Illinois State court sitting in the City of Chicago for purposes of all
legal proceedings arising out of or relating to this Guaranty, the Credit
Agreement, the other Credit Documents or the transactions contemplated hereby or
thereby, and consents to the service of process by registered or certified mail
out of any such court or by service of process on the Borrower (now at _________
_________________________________________________) which the Guarantor hereby
irrevocably appoints as its agent to receive, for it and on its behalf, service
of process in any action or proceeding in Illinois. Such service shall be deemed
completed on delivery to such process agent (whether or not it is forwarded to
and received by the Guarantor) provided that notice of such service of process
is given by the Guaranteed Creditors to the Guarantor. If, for any reason, such
process agent ceases to be able to act as such, the Guarantor irrevocably agrees
to appoint a substitute process agent acceptable to the Agent and to deliver to
the Agent a copy of the new agent's acceptance of that appointment within thirty
days. Nothing contained herein shall affect the right of the Guaranteed
Creditors to serve legal process in any other manner or to bring any proceeding
hereunder in any jurisdiction where the Guarantor may be amenable to suit. The
Guarantor irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum. Final
judgment (a certified or exemplified copy of which shall be conclusive evidence
of the fact and of the amount of any indebtedness of the Guarantor to the
Guaranteed Creditors therein described) against the Guarantor in any such legal
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment. The Guarantor, the Agent, and each Lender
hereby irrevocably waives any and all right to trial by jury in any legal
proceeding arising out of or relating to the Guaranty, any Credit Document or
the transactions contemplated hereby or thereby.
17. The Guarantor shall at all times and from time to time do, execute,
acknowledge and deliver or cause to be done, executed, acknowledged and
delivered all and singular every such further act, deed, transfer, assignment,
assurance, document and instrument as the Agent or any Lender may reasonably
require for the better accomplishing and effectuating of this Guaranty and the
provisions contained herein, and every officer of the Agent and the Lenders and
each of them are irrevocably appointed attorneys or attorney to execute in the
name and on behalf of the Guarantor any document or instrument for the said
purpose.
18. Except as otherwise defined herein, terms used herein and defined
in the Credit Agreement shall be used herein as so defined.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty Agreement to
be executed and delivered as of the date first above written.
-------------------------------------------------------
By
Its___________________________________________________
EXHIBIT F
ANICOM, INC.
BORROWING BASE CERTIFICATE
To: ▇▇▇▇▇▇ Trust and Savings Bank, as Agent under,
and the Lenders party to, the Credit Agreement
described below.
Pursuant to the terms of the Credit Agreement dated as of December 17,
1999, among us (the "Credit Agreement"), we submit this Borrowing Base
Certificate to you and certify that the information set forth below and on any
attachments to this Certificate is true, correct and complete as of the date of
this Certificate.
A. RECEIVABLES IN BORROWING BASE
1. Gross Receivables --------
Less
(a) Ineligible sales -------
(b) Owed by an account debtor who -------
is an Affiliate
(c) Owed by an account debtor principally located -------
outside the continental United States,
Puerto Rico, or Canada unless secured
by an acceptable letter of credit.
(d) Owed by the United States of -------
America or any department, agency,
or instrumentality thereof, unless the
Agent is satisfied with compliance with
Assignment of Claims Act.
(e) Evidenced by instrument or chattel paper unless -------
the same has been endorsed and delivered to the
Agent.
(f) Owed by an account debtor who is in an insolvency -------
or reorganization proceeding
(g) Credits/allowances -------
(h) Unpaid more than 90 days from invoice date and not -------
secured by surety bond or materialman's lien
(i) Unpaid more than 180 days from invoice date -------
(j) Invoiced more than 5 days from shipment date -------
(k) Otherwise ineligible -------
2. Total Deductions (sum of lines A1a - A1k;) --------
3. Total Eligible Receivables (line A1 minus line A2) --------
4. Eligible Receivables in Borrowing Base --------
(line A3 x .___)
5. Eligible Receivables included in Borrowing Base Secured --------
by surety bonds or materialmen's liens outstanding
greater than 90 days and less than 180 days from invoice
date (NOTE: not to exceed $11,000,000)
B. INVENTORY IN BORROWING BASE
1. Gross inventory of Finished Goods --------
2. Less
(a) Finished Goods not located at approved locations -------
(b) Obsolete, slow moving, or not merchantable -------
(c) Otherwise ineligible -------
3. Total Deductions (sum of lines B2a - B2c above) --------
4. Eligible Inventory (line B1 minus line B3) --------
5. Eligible Inventory in Borrowing Base (line B4 x .60) --------
C. Total Borrowing Base
1. Line A4 -------
2. Line B5 -------
3. Fiscal Year 2000 Tax Refund X .85 -------
4. Sum of Lines C1, C2 and C3 -------
5. Rent Reserve -------
6. Line C4 less the sume of (x) Line C5 plus --------
(y) $10,000,000 ("Borrowing Base")
D. REVOLVING CREDIT ADVANCES
1. Loans -------
2. Letters of Credit -------
3. Total Outstandings (line D1 plus D2) --------
E. UNUSED AVAILABILITY
(line C6 minus line D3) --------
Dated as of this ______ day of __________________.
-------------------------------------------------------------------------------
By
Name______________________________________
Title_____________________________________
SCHEDULE 1
REVOLVING CREDIT COMMITMENTS
NAME OF LENDER REVOLVING CREDIT COMMITMENT
▇▇▇▇▇▇ Trust and Savings Bank $34,000,000
Bank One, NA (Main Office Chicago) $31,500,000
LaSalle Bank National Association $31,500,000
Fleet Capital Corporation $24,000,000
Firstar Bank, N.A. $19,000,000
Bank of America, N.A. $10,000,000
SWING LINE COMMITMENTS
NAME OF LENDER EVOLVING CREDIT COMMITMENT
▇▇▇▇▇▇ Trust and Savings Bank $5,000,000
SCHEDULE 6.2
MATERIAL SUBSIDIARIES
JURISDICTION OF PERCENTAGE
NAME INCORPORATION OWNERSHIP
Anicom Multimedia Wiring Systems, Nova Scotia 100%
Incorporated
NON-MATERIAL SUBSIDIARIES
JURISDICTION OF PERCENTAGE
NAME INCORPORATION OWNERSHIP
3022504 Nova Scotia Limited Nova Scotia 100%
TW Communications Corporation New York 100%
--------
* Or debentures or other designation as may be appropriate.