EXHIBIT 4.4
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CREDIT AGREEMENT
DATED AS OF OCTOBER 6, 2004
BY AND AMONG
ESCO TECHNOLOGIES INC., AS BORROWER
THE LENDERS PARTY HERETO
AND
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
AS SWING LINE LENDER, OFFSHORE CURRENCY FRONTING LENDER,
LETTER OF CREDIT ISSUER, ADMINISTRATIVE AGENT AND SOLE LEAD
ARRANGER
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TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................................... 1
Section 1.01 Definitions........................................................................... 1
Section 1.02 Accounting Terms and Determinations................................................... 19
Section 1.03 Types of Borrowings................................................................... 19
ARTICLE II THE CREDITS........................................................................... 19
Section 2.01 Revolving Credit Commitments.......................................................... 19
Section 2.02 Swing Line Commitment................................................................. 20
Section 2.03 Fronted Offshore Currency Loans....................................................... 22
Section 2.04 Notice of Borrowings.................................................................. 24
Section 2.05 Notice to Lenders; Funding of Loans................................................... 26
Section 2.06 Utilization of Commitments in Offshore Currencies..................................... 28
Section 2.07 Notes................................................................................. 29
Section 2.08 Payment of Obligations................................................................ 31
Section 2.09 Interest Rates........................................................................ 31
Section 2.10 Loan Fees............................................................................. 33
Section 2.11 Optional Termination or Reduction of, or Increase in, the Revolving
Credit Commitments.................................................................... 34
Section 2.12 Mandatory Termination of Commitments.................................................. 35
Section 2.13 Prepayments........................................................................... 35
Section 2.14 General Provisions as to Payments..................................................... 36
Section 2.15 Funding Losses........................................................................ 37
Section 2.16 Computation of Interest and Fees..................................................... 37
Section 2.17 Withholding Tax Exemption............................................................. 38
Section 2.18 Letters of Credit..................................................................... 38
ARTICLE III CONDITIONS............................................................................ 43
Section 3.01 Effectiveness......................................................................... 43
Section 3.02 Revolving Credit Loan................................................................. 44
Section 3.03 Swing Line Loans...................................................................... 45
Section 3.04 Fronted Offshore Currency Loans....................................................... 45
Section 3.05 Letters of Credit..................................................................... 46
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................ 47
Section 4.01 Corporate Existence and Power......................................................... 47
Section 4.02 Corporate and Governmental Authorization; No Contravention............................ 47
Section 4.03 Binding Effect........................................................................ 47
Section 4.04 Financial Information................................................................. 47
Section 4.05 Litigation............................................................................ 48
Section 4.06 Compliance with ERISA................................................................. 48
Section 4.07 Environmental Matters................................................................. 48
Section 4.08 Taxes................................................................................. 49
Section 4.09 Subsidiaries.......................................................................... 49
Section 4.10 Full Disclosure....................................................................... 49
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Section 4.11 Compliance With Laws.................................................................. 49
Section 4.12 Title to Property..................................................................... 50
Section 4.13 Regulation U.......................................................................... 50
Section 4.14 Investment Company Act of 1940; Public Utility Holding Company Act of
1935.................................................................................. 50
Section 4.15 No Default............................................................................ 50
Section 4.16 Licenses, Permits, etc................................................................ 50
Section 4.17 Existing Debt......................................................................... 51
ARTICLE V COVENANTS............................................................................. 51
Section 5.01 Information........................................................................... 51
Section 5.02 Inspections........................................................................... 53
Section 5.03 Maintenance of Property; Insurance.................................................... 53
Section 5.04 Conduct of Business and Maintenance of Existence...................................... 54
Section 5.05 Compliance with Laws.................................................................. 54
Section 5.06 Payment of Taxes...................................................................... 54
Section 5.07 Maximum Consolidated Leverage Ratio................................................... 54
Section 5.08 Minimum EBITDA........................................................................ 55
Section 5.09 Minimum Consolidated Tangible Net Worth............................................... 55
Section 5.10 Limitation on Debt.................................................................... 55
Section 5.11 Negative Pledge....................................................................... 56
Section 5.12 Consolidations, Mergers and Sales of Assets........................................... 57
Section 5.13 Transactions with Affiliates.......................................................... 57
Section 5.14 Acquisitions.......................................................................... 58
Section 5.15 Limitation on Certain Covenants and Restrictions..................................... 58
Section 5.16 Pari Passu Position; Covenant to Secure the Obligations Equally....................... 58
Section 5.17 New Materials Subsidiaries............................................................ 58
Section 5.18 Use of Proceeds....................................................................... 59
ARTICLE VI DEFAULTS.............................................................................. 59
Section 6.01 Events of Default..................................................................... 59
Section 6.02 Notice of Default..................................................................... 62
ARTICLE VII THE ADMINISTRATIVE AGENT AND LETTER OF CREDIT ISSUER.................................. 62
Section 7.01 Appointment........................................................................... 62
Section 7.02 Nature of Duties...................................................................... 62
Section 7.03 Exculpation Rights, Etc............................................................... 63
Section 7.04 Reliance.............................................................................. 63
Section 7.05 Indemnification....................................................................... 63
Section 7.06 Administrative Agent In Its Individual Capacity....................................... 64
Section 7.07 Notice of Default..................................................................... 64
Section 7.08 Holders of Obligations................................................................ 64
Section 7.09 Resignation by the Administrative Agent............................................... 64
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Section 7.10 Application of Article VII to Swing Line Lender and Letter of Credit
Issuer................................................................................ 65
Section 7.11 Other Agents.......................................................................... 65
ARTICLE VIII CHANGE IN CIRCUMSTANCES............................................................... 65
Section 8.01 Basis for Determining Interest Rate Inadequate or Unfair.............................. 65
Section 8.02 Illegality............................................................................ 66
Section 8.03 Increased Cost and Reduced Return..................................................... 66
Section 8.04 Base Rate Loans Substituted for Affected LIBOR Loans.................................. 68
ARTICLE IX MISCELLANEOUS......................................................................... 68
Section 9.01 Notices............................................................................... 68
Section 9.02 No Waivers............................................................................ 68
Section 9.03 Expenses; Documentary Taxes; Indemnification.......................................... 68
Section 9.04 Sharing Among Banks................................................................... 69
Section 9.05 Amendments and Waivers................................................................ 69
Section 9.06 Successors and Assigns................................................................ 70
Section 9.07 Collateral............................................................................ 73
Section 9.08 Governing Law......................................................................... 73
Section 9.09 Counterparts.......................................................................... 73
Section 9.10 NO ORAL AGREEMENTS; ENTIRE AGREEMENT.................................................. 73
Section 9.11 Confidentiality....................................................................... 73
Section 9.12 Consent to Jurisdiction; Waiver of Jury Trial......................................... 74
Section 9.13 Independence of Covenants............................................................. 74
Section 9.15 Distribution of Material.............................................................. 75
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Schedule 1.01 - Commitments
Schedule 4.05 - Litigation
Schedule 4.06 - ERISA
Schedule 4.09 - Subsidiaries
Schedule 4.17 - Existing Debt
Schedule 5.11 - Existing Liens
Schedule 9.01 - Notice Information
Exhibit A - Notice of Revolving Credit Borrowing
Exhibit B - Notice of Swing Line Borrowing
Exhibit C - Revolving Credit Note
Exhibit D - Swing Line Note
Exhibit E - Opinion of Borrower's Counsel
Exhibit F - Assignment and Assumption Agreement
Exhibit G - Compliance Certificate
Exhibit H - Borrowing Subsidiary Supplement
Exhibit I - Offshore Currency Addendum
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of October 6, 2004, is by and among
ESCO TECHNOLOGIES INC., a Missouri corporation ("Borrower"), the Lenders from
time to time party hereto, ▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION, as the Swing
Line Lender, Offshore Currency Fronting Lender, Letter of Credit Issuer,
Administrative Agent and Sole Lead Arranger.
WITNESSETH:
WHEREAS, the Borrower has requested that the Lenders provide a
revolving credit facility consisting of revolving credit loans to and letters of
credit for the account of the Borrower and offshore currency loans to certain
Borrowing Subsidiaries in the aggregate amount of up to $100,000,000 at any one
time outstanding (including a swing line subfacility thereunder from the Swing
Line Lender in the principal amount of up to $7,500,000, a foreign currency
subfacility thereunder from the Offshore Currency Fronting Lender in the
principal amount of up to $30,000,000 and a letter of credit subfacility
thereunder from the Letter of Credit Issuer in the principal amount of up to
$25,000,000);
WHEREAS, the proceeds of the revolving credit facility will be used to
refinance certain existing indebtedness of the Borrower, to finance Permitted
Acquisitions and for ongoing working capital and general corporate purposes,
including, without limitation, to pay fees, costs and expenses incurred in
connection with the transactions contemplated hereby; and
WHEREAS, the Lenders are willing to extend commitments to make
Revolving Credit Loans to the Borrower hereunder, the Offshore Currency Fronting
Lender is willing to extend a commitment to make Fronted Offshore Currency Loans
to the Borrowing Subsidiaries hereunder, the Swing Line Lender is willing to
extend a commitment to make Swing Line Loans to the Borrower hereunder and the
Letter of Credit Issuer is willing to extend a commitment to issue Letters of
Credit upon the application of the Borrower and for the account of the Borrower
or a Guarantor Subsidiary hereunder, in each case, for the respective purposes
provided herein and only on the terms and subject to the conditions hereinafter
set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. The following terms, as used herein, have the
following meanings:
"Acquired Business" means the entity or assets acquired by the Borrower
or a Subsidiary in an Acquisition.
"Acquired Cash Flow" means, with respect to any period, the
Consolidated EBITDA attributable on a pro forma basis to any Acquisitions
effected during such period assuming the consummation of such Acquisition as of
the first day of such period, taking into account
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adjustments reasonably satisfactory to Administrative Agent to eliminate the
effect of any non-recurring expenses or income with respect to Borrower and its
Subsidiaries or any acquired Person or assets on Consolidated EBITDA as
determined by the chief financial officer of Borrower, the basis for which are
set forth in reasonable detail in the compliance certificate delivered to
Administrative Agent pursuant to Section 5.01(c).
"Acquisition" means any transaction or series of related transactions,
consummated on or after the date of this Agreement, by which the Borrower or any
Subsidiary directly or indirectly (a) acquires all or substantially all of the
assets comprising one or more business units of any other Person, whether
through purchase of assets, merger or otherwise or (b) acquires (in one
transaction or as the most recent transaction in a series of transactions) at
least (i) a majority (in number of votes) of the capital stock and/or other
securities of a corporation having ordinary voting power for the election of
directors (other than stock and/or other securities having such power only by
reason of the happening of a contingency), (ii) a majority (by percentage of
voting power) of the outstanding partnership interests of a partnership, (iii) a
majority (by percentage of voting power) of the outstanding membership interests
of a limited liability company or (iv) a majority of the ownership interests in
any organization or entity other than a corporation, partnership or limited
liability company.
"Adjusted Base Rate" means the Base Rate plus the Applicable Base Rate
Margin. The Adjusted Base Rate shall be adjusted automatically on and as of the
effective date of any change in the Base Rate and/or the Applicable Base Rate
Margin.
"Administrative Agent" means ▇▇▇▇▇ Fargo in its capacity as
Administrative Agent for the Lenders hereunder, and its successors in such
capacity.
"Administrative Agent-Related Persons" means the Administrative Agent
(including any successor Administrative Agent), together with its affiliates,
and the officers, directors, employees, agents and attorneys-in-fact of such
Persons and affiliates.
"Administrative Questionnaire" means, with respect to each Lender, an
administrative questionnaire in the form prepared by the Administrative Agent
and submitted to the Administrative Agent duly completed by such Lender.
"Affiliate" means any Person (a) which directly or indirectly through
one or more intermediaries controls, is controlled by or is under common control
with the Borrower or any Subsidiary, (b) which directly or indirectly through
one or more intermediaries beneficially owns or holds or has the power to direct
the voting power of 5% or more of any class of capital stock, partnership
interests, membership interests or other equity interests of the Borrower or any
Subsidiary, (c) which has 5% or more of any class of its capital stock,
partnership interests, membership interests or other equity interests
beneficially owned or held, directly or indirectly, by the Borrower or any
Subsidiary or (d) who is a director, officer, manager or employee of the
Borrower or any Subsidiary. For purposes of this definition, "control" means
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise.
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"Agent Fee Letter" means the letter agreement between the Borrower and
the Administrative Agent, dated ___, 2004, relating to certain agency and other
fees due the Administrative Agent and the Lenders, as the same may be amended,
modified, extended, renewed, supplemented or restated from time to time.
"Agreement" means this Credit Agreement, as the same may be amended,
modified, extended, renewed, supplemented or restated from time to time.
"Alternate Currency" shall mean any Offshore Currency (and any other
currency which is at the relevant time freely traded in the offshore interbank
foreign exchange markets and is freely transferable and freely convertible into
Dollars) which the applicable Borrowing Subsidiary requests the Offshore
Currency Fronting Lender to include as an Alternate Currency hereunder and which
is acceptable to the Offshore Currency Fronting Lender and with respect to which
an Offshore Currency Addendum has been executed by a Borrowing Subsidiary and
the Offshore Currency Fronting Lender in connection therewith.
"Applicable Lending Office" means, with respect to any Lender, (a) in
the case of its Base Rate Loans, its Base Rate Lending Office and (b) in the
case of its LIBOR Loans, its LIBOR Lending Office.
"Applicable LIBOR Margin", "Applicable Base Rate Margin" and
"Applicable Commitment Fee Rate" mean the per annum rate shown in the applicable
column below based on the applicable Consolidated Leverage Ratio:
If the Consolidated Applicable LIBOR Applicable Base Applicable Commitment
Leverage Ratio is, then Margin is Rate Margin is Fee Rate is
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> or = 2.5 to 1.0 (Pricing Level I) 1.375% 0.000% 0.275%
> or = 2.0 to 1.0 but
< 2.5 to 1.0 (Pricing Level II) 1.125% 0.000% 0.250%
> or = 1.5 to 1.0 but
< 2.0 to 1.0 (Pricing Level III) 0.875% 0.000% 0.225%
> or = 1.0 to 1.0 but
< 1.50 to 1.0 (Pricing Level IV) 0.750% 0.000% 0.200%
< 1.0 to 1.0 (Pricing Level V) 0.625% 0.000% 0.175%
The determination of the Applicable LIBOR Margin, the Applicable Base Rate
Margin and the Applicable Commitment Fee Rate as of any date shall be based on
the Consolidated Leverage
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Ratio as of the last day of the most recently ended Fiscal Quarter for which
financial statements of Borrower and its Subsidiaries (and the related
Compliance Certificate) have been delivered to the Administrative Agent pursuant
to Section 5.01 (which determination shall be made and be effective from and
after the date the Administrative Agent receives the applicable financial
statements and Compliance Certificate from the Borrower); provided, however,
that if the applicable financial statements and related Compliance Certificate
for any Fiscal Quarter or Fiscal Year are not delivered to the Administrative
Agent when due in accordance with Section 5.01, then Pricing Level I shall apply
during the period commencing on the date such financial statements and
Compliance Certificate were due and ending on the date such financial statements
and Compliance Certificate are delivered to the Administrative Agent.
Notwithstanding the foregoing, Pricing Level V shall apply during the period
commencing on the date of this Agreement and ending on the date the
Administrative Agent receives the Borrower's financial statements for its Fiscal
Quarter ending September 30, 2004; provided, however, that if such financial
statements and related Compliance Certificate are not delivered to the
Administrative Agent when due in accordance with Section 5.01, then Pricing
Level I shall apply during the period commencing on the date such financial
statements and Compliance Certificate were due and ending on the date such
financial statements and Compliance Certificate are delivered to the
Administrative Agent.
"Assignee" has the meaning set forth in Section 9.06(c).
"Assignment and Assumption Agreement" has the meaning set forth in
Section 9.06(c).
"Base Rate" means, for any day, a rate of interest per annum equal to
the higher of (a) the Prime Rate for such day and (b) the sum of the Federal
Funds Effective Rate for such day plus 1/2% per annum.
"Base Rate Lending Office" means, as to each Lender, its office located
at its address set forth in its Administrative Questionnaire (or identified in
its Administrative Questionnaire as its Base Rate Lending Office) or such other
office as such Lender may hereafter designate as its Base Rate Lending Office by
notice to the Borrower and the Administrative Agent.
"Base Rate Loan" means each Loan to be made by a Lender as a Base Rate
Loan in accordance with the applicable Notice of Revolving Credit Borrowing or
the applicable Offshore Currency Addendum or pursuant to Article VIII, and each
Loan continued as a, or converted into, a Base Rate Loan pursuant to Section
2.04(d).
"Benefit Arrangement" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any member of the ERISA
Group.
"Borrower" means, ESCO Technologies Inc., a Missouri corporation, and
its successors.
"Borrowing Subsidiary" means any Foreign Subsidiary that is designated
as a Borrowing Subsidiary by the Company pursuant to Section 2.03 (i) with the
consent of Administrative Agent, which consent shall not be unreasonably
withheld, which Foreign Subsidiary shall have delivered a Borrowing Subsidiary
Supplement in accordance with Section 2.03(i).
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"Borrowing" has the meaning set forth in Section 1.03.
"Borrowing Subsidiary Supplement" means a Borrowing Subsidiary
Supplement in the form of Exhibit H.
"Business Day" means (a) with respect to any borrowing, payment or rate
selection of LIBOR Loans, a day (other than a Saturday on Sunday) on which
lenders generally are open in Denver, Colorado and San Francisco, California for
the conduct of substantially all of their commercial lending activities and on
which dealings in United States dollars are carried on in the London interbank
market, (b) with respect to any Loan denominated in a Foreign Currency, a day
(other than a Saturday or Sunday) on which lenders generally are open for
foreign exchange business in London, England and on which dealings in the
relevant Offshore Currency are carried on in the applicable offshore foreign
exchange interbank market in which disbursements of or payments in such Offshore
Currency will be made or received, and (c) for all other purposes, a day (other
than a Saturday or Sunday) on which lenders generally are open in Denver,
Colorado and San Francisco, California for the conduct of substantially all of
their commercial lending activities.
"Capitalized Lease" means any lease of (or other indebtedness
arrangements conveying the right to use) real and/or personal property, by a
Person as lessee which in accordance with GAAP is required to be capitalized on
the balance sheet of such Person.
"Capitalized Lease Obligations" of any Person means, as of the date of
any determination thereof, the amount at which the aggregate rental and other
payment obligations due and to become due under all Capitalized Leases under
which such Person is a lessee would be reflected as a liability on a balance
sheet of such Person in accordance with GAAP.
"Central Standard Time" means, at any time, time in the central time
zone in the United States at such time, whether daylight savings time or
standard time.
"Compliance Certificate" means a certificate in the form of Exhibit G
attached hereto delivered in accordance with Section 5.01(c).
"Computation Date" has the meaning specified in Section 2.06(a).
"Consolidated Debt" means, as of the date of any determination thereof,
all Debt of the Borrower and its Subsidiaries as of such date, determined on a
consolidated basis and in accordance with GAAP.
"Consolidated EBITDA" means, for the period in question, the sum of (a)
Consolidated Net Income during such period plus (b) to the extent deducted in
determining such Consolidated Net Income, the sum of (i) Consolidated Interest
Expense during such period, plus (ii) all provisions for any Federal, state,
local and/or foreign income taxes made by the Borrower and its Subsidiaries
during such period (whether paid or accrued) plus (iii) all depreciation and
amortization expenses of the Borrower and its Subsidiaries during such period,
all determined on a consolidated basis and in accordance with GAAP; provided,
however, that for the purposes of determining Consolidated EBITDA for any period
during which an Acquisition permitted under this Agreement is consummated,
Consolidated EBITDA shall be adjusted to give effect to the
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consummation of such Acquisition on a pro forma basis in accordance with GAAP,
as if such Acquisition occurred on the first day of such period, such
adjustments to be calculated in a manner reasonably satisfactory to the
Administrative Agent.
"Consolidated Interest Expense" means, for the period in question,
without duplication, all gross interest expense of the Borrower and its
Subsidiaries (including, without limitation, all commissions, discounts and/or
related amortization and other fees and charges owed by the Borrower and its
Subsidiaries with respect to letters of credit, the net costs associated with
interest swap obligations of the Borrower and its Subsidiaries, capitalized
interest expense, the interest portion of Capitalized Lease Obligations and the
interest portion of any deferred payment obligation) during such period, all
determined on a consolidated basis and in accordance with GAAP; provided,
however, that for the purposes of determining Consolidated Interest Expense for
any period during which an Acquisition permitted under this Agreement is
consummated, Consolidated Interest Expense shall be adjusted to give effect to
the consummation of such Acquisition on a pro forma basis in accordance with
GAAP, as if such Acquisition occurred on the first day of such period, such
adjustments to be calculated in a manner reasonably satisfactory to the
Administrative Agent.
"Consolidated Leverage Ratio" means, as of the last day of any Fiscal
Quarter, the ratio of (a) Consolidated Debt as of such day to (b) Consolidated
EBITDA for the four (4) consecutive Fiscal Quarter period ending on such day.
"Consolidated Net Income" means, for the period in question, the
after-tax net income (or loss) of Borrower and its Subsidiaries during such
period, determined on a consolidated basis and in accordance with GAAP, after
excluding (a) any loss or any income of any Person in which the Borrower or a
Subsidiary has an ownership interest (other than a Subsidiary) except to the
extent that any such income has actually been received by the Borrower or such
Subsidiary in the form of cash dividends or similar cash distributions, (b) any
gain or loss (net of any tax effect) resulting from the sale of any capital
assets by the Borrower or any Subsidiary other than in the ordinary course of
business, (c) extraordinary, unusual or non-recurring gains or losses, (d) gains
resulting from the write-up of assets, and (e) proceeds of any life insurance
policy.
"Consolidated Net Worth" means, as of the date of any determination
thereof, the consolidated stockholders' equity of the Borrower and its
Subsidiaries as of such date, determined on a consolidated basis and in
accordance with GAAP.
"Consolidated Total Assets" means, as of the date of any determination
thereof, the total amount of all assets of the Borrower and its Subsidiaries as
of such date, determined on a consolidated basis and in accordance with GAAP.
"Consolidated Total Capitalization" means, as of the date of any
determination thereof, the sum of (a) Consolidated Net Worth as of such date
plus (b) Consolidated Debt as of such date.
"Conversion/Continuation Notice" has the meaning set forth in Section
2.04(d).
"Credit Availability Period" means the period from and including the
Effective Date to but not including the Termination Date.
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"Debt" of any Person shall mean, as of the date of determination
thereof, the sum of, without duplication, (a) all obligations of such Person for
borrowed money, (b) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (c) all fixed or contingent
reimbursement obligations of such Person with respect to letters of credit, (d)
all obligations of such Person to pay the deferred purchase price of property or
services (other than unsecured trade accounts payable, deferred compensation
items and like expense accruals arising in the ordinary course of business), (e)
all Capitalized Lease Obligations of such Person, (f) all Synthetic Lease
Obligations of such Person, (g) the Swap Termination Value under any Swap
Contract to which such Person is a party to the extent such Swap Termination
Value is owed or would be owed by such Person, (h) all Debt of any partnership
or joint venture (other than a joint venture that it itself a corporation or
limited liability company) in which such Person is a general partner of joint
venturer, except to the extent that such Debt is expressly made non-recourse to
such Person, and (i) all Debt of others of the kind described in clauses (a)
through (h) above which is Guaranteed by such Person. The amount of any Debt
Guaranteed by a Person pursuant to clause (i) above shall be deemed to be an
amount equal to the lesser of (i) the stated or determinable amount (inclusive
of principal, interest, fees and other charges) of the primary obligation in
respect of which such Guarantee is made or (ii) the maximum amount for which
such guaranteeing Person may be liable pursuant to the terms of the instrument
embodying such Guarantee, unless such primary obligation and the maximum amount
for which such guaranteeing Person may be liable are not stated or determinable,
in which case the amount of Debt subject to such Guarantee shall be such
guaranteeing Person's maximum reasonably anticipated liability in respect
thereof as mutually determined by Borrower's Board of Directors and the
Administrative Agent.
"Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time, or both, would,
unless cured or waived, become an Event of Default.
"Defaulting Lender" has the meaning set forth in Section 2.04(f).
"Dollar" and "$" means lawful money of the United States of America.
"Dollar Equivalent" means, at any time, (a) as to any amount
denominated in Dollars, the amount thereof at such time, and (b) as to any
amount denominated in an Offshore Currency, the equivalent amount in Dollars, as
determined by Administrative Agent at such time on the basis of the Spot Rate
for the purchase of Dollars with such Offshore Currency on the most recent
Computation Date.
"Domestic Subsidiary" means each Subsidiary which is not a Foreign
Subsidiary.
"EBITDA" means with respect to any Subsidiary, for the period in
question, the sum of (a) Net Income during such period plus (b) to the extent
deducted in determining such Net Income, the sum of (i) Interest Expense during
such period, plus (ii) all provisions for any Federal, state, local and/or
foreign income taxes made by such Subsidiary and its subsidiaries during such
period (whether paid or accrued), plus (iii) all depreciation and amortization
expenses of such Subsidiary and its subsidiaries during such period, all
determined on a consolidated basis and in accordance with GAAP; provided,
however, that for the purposes of
7
determining EBITDA for any period during which an Acquisition permitted under
this Agreement is consummated, EBITDA shall be adjusted to give effect to the
consummation of such Acquisition on a pro forma basis in accordance with GAAP,
as if such Acquisition occurred on the first day of such period, such
adjustments to be calculated in a manner reasonably satisfactory to the
Administrative Agent.
"Effective Date" means the date this Agreement becomes effective in
accordance with Section 3.01.
"Eligible Line of Business" means any business engaged in as of the
date of this Agreement by the Borrower or any Subsidiary and businesses similar
or related thereto.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules or other governmental
restrictions to which the Borrower or any Subsidiary is subject relating to the
environment or to emissions, discharges or releases of pollutants, contaminants,
petroleum or petroleum products, chemicals or toxic or hazardous substances or
wastes into the environment including, without limitation, ambient air, surface
water, ground water or land, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, petroleum or petroleum products, chemicals
or toxic or hazardous substances or wastes or the clean-up or other remediation
thereof and any and all judgments, orders, decrees, permits, grants, franchises,
licenses or agreements relating to the foregoing to which the Borrower or any
Subsidiary is a party or which is otherwise applicable to the Borrower or any
Subsidiary.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
"ERISA Group" means the Borrower and all members of a controlled group
of corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, are treated, on or after the
Effective Date, as a single employer under Section 414 of the Internal Revenue
Code.
"EURIBOR Base Rate" means an interest rate set for the drawing of
financial funds in Euro for a period equal to the Interest Period four Business
Days prior to the first day of the relevant Interest Period appearing on the
Reuters screen at about 11 a.m. Brussels time, page "EURIBOR01". Reuters Screen,
page "EURIBOR01" means the displays entitled as page "EURIBOR01" on the money
rates monitor of the Reuters agency (Reuters Monitor Money Rate Service) or on
any other page which may replace page EURIBOR01 in the service of the said
agency for the purposes of display of the interbank interest rates offered on
the Eurozone market;
"EURIBOR Rate" means, with respect to Revolving Credit Loans
denominated in Euro for the relevant Interest Period, the sum of (i) the
quotient of (A) the EURIBOR Base Rate applicable to such Interest Period,
divided by (B) one minus the Reserve Requirement (expressed as a decimal)
applicable to such Interest Period, plus (ii) the Applicable LIBOR Margin. The
EURIBOR Rate shall be rounded to the next higher multiple of 1/16 of 1% if the
rate is not such a multiple.
"Event of Default" has the meaning set forth in Section 6.01.
8
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 9:00 a.m. (Central
Standard Time) on such day on such transactions received by the Administrative
Agent from three (3) Federal funds brokers of recognized standing selected by
the Administrative Agent in its sole discretion.
"Financial Officer" means the chief financial officer or the treasurer
of the Borrower.
"Fiscal Quarter" means a fiscal quarter of the Borrower.
"Fiscal Year" means a fiscal year of the Borrower.
"Foreign Subsidiary" means each Subsidiary which (a) is organized under
the laws of a jurisdiction other than the United States of America or any state,
territory or political subdivision thereof, (b) conducts substantially all of
its business outside of the United States of America and (c) has substantially
all of its assets outside of the United States of America.
"Fronted Offshore Currency Commitment" means, for the Offshore Currency
Fronting Lender for each Alternate Currency, the obligation of the Offshore
Currency Fronting Lender to make Fronted Offshore Currency Loans in such
Alternate Currency not exceeding the Dollar Equivalent set forth in the
applicable Offshore Currency Addendum, as such amount may be modified from time
to time pursuant to the terms of this Agreement and the applicable Offshore
Currency Addendum.
"Fronted Offshore Currency Loan" means a loan made by an Offshore
Currency Fronting Lender to a Borrowing Subsidiary pursuant to Section 2.03 and
an Offshore Currency Addendum.
"Fronted Offshore Currency Note" means a promissory note in such form
as required by the Offshore Currency Addendum.
"GAAP" means, at any time, generally accepted accounting principles at
such time in the United States.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
liability or obligation of any other
9
Person and, without limiting the generality of the foregoing, any obligation,
direct or indirect, contingent or otherwise, of such Person (a) to purchase or
pay (or advance or supply funds for the purchase or payment of) such Debt or
other obligation (whether arising by virtue of partnership arrangements, by
agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or (b)
entered into for the purpose of assuring in any other manner the obligee of such
Debt of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part); provided that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantor Subsidiary" means each of Comtrak Technologies, L.L.C., a
Missouri limited liability company, Distribution Control Systems, Inc., a
Missouri corporation, ETS-▇▇▇▇▇▇▇▇ ▇.▇., a Texas limited partnership, ESCO
Technologies Holding Inc., a Delaware corporation, Filtertek Inc., a Delaware
corporation, ▇▇▇▇▇▇▇▇ Inc., a Delaware corporation, ▇▇▇▇▇▇▇▇ ▇.▇. Enclosures,
Inc., an Illinois corporation, PTI Technologies Inc., a Delaware corporation,
Rantec Holdings Inc., a Missouri corporation, Rantec Commercial Inc., a
California corporation, and Vacco Industries, a California corporation, each of
which is a Subsidiary of the Borrower, and any other Subsidiary which hereafter
Guarantees the payment of the Obligations.
"Guaranty" means that certain Continuing Guaranty dated as of the date
hereof and executed by each Guarantor Subsidiary in favor of the Administrative
Agent, the Swing Line Lender, the Offshore Currency Fronting Lender, the Letter
of Credit Issuer and each Lender with respect to the Obligations, as the same
may be amended, modified, extended, renewed, supplemented or restated from time
to time.
"Hostile Acquisition" means the acquisition of the capital stock,
partnership interests, membership interests or other equity interests of a
Person through a tender offer or similar solicitation of the owners of such
capital stock, partnership interests, membership interests or other equity
interests which has not been approved (prior to such acquisition) by resolutions
of the Board of Directors of such Person or by similar action if such Person is
not a corporation, and as to which such approval has not been withdrawn.
"Interest Expense" means with respect to any Subsidiary, for the period
in question, without duplication, all gross interest expense of such Subsidiary
and its subsidiaries (including, without limitation, all commissions, discounts
and/or related amortization and other fees and charges owed by such Subsidiary
and its subsidiaries with respect to letters of credit, the net costs associated
with interest swap obligations of such Subsidiary and its subsidiaries,
capitalized interest expense, the interest portion of Capitalized Lease
Obligations and the interest portion of any deferred payment obligation) during
such period, all determined on a consolidated basis and in accordance with GAAP;
provided, however, that for the purposes of determining Interest Expense for any
period during which an Acquisition permitted under this Agreement is
consummated, Interest Expense shall be adjusted to give effect to the
consummation of such Acquisition on a pro forma basis in accordance with GAAP,
as if such Acquisition occurred on the first day of such period, such
adjustments to be calculated in a manner reasonably satisfactory to the
Administrative Agent.
"Interest Period" means, with respect to each LIBOR Loan and each
Offshore Currency Loan, the period commencing on the date of such Borrowing and
ending 1, 2, 3 or 6 months
10
thereafter, as the Borrower may elect in the applicable Notice of Revolving
Credit Borrowing or Conversion/Continuation Notice, as the case may be; provided
that:
(a) any Interest Period which would otherwise end on a day
which is not a Business Day shall be extended to the next succeeding Business
Day unless such Business Day falls in another calendar month, in which case such
Interest Period shall end on the next preceding Business Day;
(b) any Interest Period which begins on the last Business Day
of a calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall, subject to
clause (c) below, end on the last Business Day of a calendar month; and
(c) no Interest Period may extend beyond the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.
"Investment" shall mean any investment (including, without limitation,
any loan or advance) by any Person in or to any other Person, whether payment
therefor is made in cash or capital stock or other equity interests, and whether
such investment is by acquisition of stock or other equity interests or
indebtedness, or by loan, advance, transfer of property or assets out of the
ordinary course of business, capital contribution, equity or profit sharing
interest, extension of credit on terms other than those normal in the ordinary
course of business or otherwise.
"Issuance Request" shall have the meaning set forth in Section 2.18(d).
"Lender" means each lender listed on the signature pages of this
Agreement, each Assignee which becomes a Lender pursuant to Section 9.06(c) and
their respective successors and assigns; provided, however, that for purposes of
this Agreement and each other Loan Document, "Lender" shall also include each
affiliate of a Lender which has entered into a Swap Contract with the Borrower
relating to any of the Loans and its successor and assigns and each such
affiliate and its successors and assigns shall be deemed to be a Lender party to
this Agreement.
"Letter of Credit" means a Letter of Credit issued pursuant to Section
2.18.
"Letter of Credit Expiry Date" means, with respect to any Letter of
Credit, the date which is the earlier of (i) eighteen (18) months after the date
of issuance therefor or (ii) five (5) Business Days prior to the Termination
Date.
"Letter of Credit Issuer" means ▇▇▇▇▇ Fargo, as the issuer of the
Letters of Credit.
"Letter of Credit Issuer-Related Persons" means the Letter of Credit
Issuer (including any successor Letter of Credit Issuer), together with its
affiliates, and the officers, directors, employees, agents and attorneys-in-fact
of such Persons and affiliates.
11
"Letter of Credit Obligations" means, as at the time of determination
thereof, the sum of (i) the Reimbursement Obligations then outstanding plus (ii)
the aggregate undrawn face amount of the then outstanding Letters of Credit.
"Letter of Credit Sublimit" means the lesser of (a) $25,000,000 and (b)
the total Revolving Credit Commitments at such time.
"LIBOR Base Rate" means, with respect to LIBOR Loans for the relevant
Interest Period, the rate determined by the Administrative Agent to be the rate
offered by first-class lenders in the London interbank market to ▇▇▇▇▇ Fargo to
place deposits in U.S. dollars at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, in the approximate
amount of the relevant LIBOR Loan and having a maturity equal to such Interest
Period.
"LIBOR Lending Office" means, as to each Lender, its office, branch or
affiliate located at its address set forth in its Administrative Questionnaire
(or identified in its Administrative Questionnaire as its LIBOR Lending Office)
or such other office, branch or affiliate of such Lender as it may hereafter
designate as its LIBOR Lending Office by notice to the Borrower and the
Administrative Agent.
"LIBOR Loan" means each Loan to be made as a LIBOR Loan in accordance
with the applicable Notice of Revolving Credit Borrowing or the applicable
Offshore Currency Addendum.
"LIBOR Rate" means, with respect to LIBOR Loans for the relevant
Interest Period, the sum of (i) the quotient of (A) the LIBOR Base Rate
applicable to such Interest Period, divided by (B) one minus the Reserve
Requirement (expressed as a decimal) applicable to such Interest Period, plus
(ii) the Applicable LIBOR Margin. The LIBOR Rate shall be rounded to the next
higher multiple of 1/16 of 1% if the rate is not such a multiple.
"Lien" shall mean any interest in property securing an obligation owed
to, or a claim by, a Person other than the owner of the property, whether such
interest is based on common law, statute or contract, including, without
limitation, any security interest, mortgage, deed of trust, pledge,
hypothecation, judgment lien or other lien or encumbrance of any kind or nature
whatsoever, any conditional sale or trust receipt, any lease (other than an
operating lease), consignment or bailment for security purposes and any
Capitalized Lease.
"Loan" means a Revolving Credit Loan, a Swing Line Loan or a Fronted
Offshore Currency Loan.
"Loan Document" means this Agreement, each Offshore Currency Addendum,
each Borrowing Subsidiary Supplement, each Note, each Reimbursement Agreement,
the Guaranty, each document evidencing the granting of a security interest or
lien with respect to Borrower's direct or indirect ownership interest in each
Material Foreign Subsidiary, the Agent Fee Letter, the Upfront Fee Letter and
each Swap Contract now or hereafter executed by the Borrower, a Borrowing
Subsidiary or a Guarantor Subsidiary with or in favor of a Lender or an
affiliate of a Lender relating to any of the Loans, each as the same may be
amended, modified, extended, renewed, supplemented or restated from time to
time.
12
"Material Adverse Effect" means (a) a material adverse effect on the
properties, assets, liabilities, business, prospects, operations, income or
condition (financial or otherwise) of the Borrower and its Subsidiaries taken as
a whole, (b) material impairment of the ability of the Borrower or any Borrowing
Subsidiary to perform its obligations under any of the Loan Documents, (c)
material impairment of the ability of any Guarantor Subsidiary to perform its
obligations under the Guaranty or (d) material impairment of the enforceability
of the rights of, or benefits available to, the Administrative Agent, the Swing
Line Lender, the Offshore Currency Fronting Lender, the Letter of Credit Issuer
and/or any Lender under this Agreement, any Note, the Guaranty and/or any other
Loan Document.
"Material Debt" means any Debt (other than the Obligations) of the
Borrower and/or one or more of its Subsidiaries, arising in one or more related
or unrelated transactions, in an aggregate principal amount exceeding
$10,000,000.
"Material Plan" means at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $10,000,000.
"Material Subsidiary" means (a) any Domestic Subsidiary which has
Guaranteed any Material Debt or (b) any Domestic Subsidiary or Foreign
Subsidiary which (i) has assets with an aggregate book value which at any time
exceeds 2.5% of Consolidated Total Assets at such time or (ii) has EBITDA during
any four (4) consecutive Fiscal Quarter period which exceeds 5% of Consolidated
EBITDA during such period. Notwithstanding the foregoing, if at any time (a) all
of the Subsidiaries which are not Material Subsidiaries have, in the aggregate,
assets with a book value which at any time exceeds 15% of Consolidated Total
Assets at such time or (b) all of the Subsidiaries which are not Material
Subsidiaries have, in the aggregate, EBITDA during any four (4) consecutive
Fiscal Quarter period which exceeds 15% of Consolidated EBITDA during such
period, then from and after such time all of the Subsidiaries shall be Material
Subsidiaries.
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five (5) plan years made contributions, including for
these purposes any Person which ceased to be a member of the ERISA Group during
such five (5) year period.
"Net Income" means for any Subsidiary, for the period in question, the
after-tax net income (or loss) of such Subsidiary and its subsidiaries during
such period, determined on a consolidated basis and in accordance with GAAP,
after excluding (a) any loss or any income of any Person in which such
Subsidiary or any of its subsidiaries has an ownership interest (other than
subsidiary) except to the extent that any such income has actually been received
by such Subsidiary or a subsidiary of such Subsidiary in the form of cash
dividends or similar cash distributions, (b) any gain or loss (net of any tax
effect) resulting from the sale of any capital assets by such Subsidiary or a
subsidiary of such Subsidiary other than in the ordinary course of business, (c)
extraordinary, unusual or non-recurring gains or losses, (d) gains resulting
from the write-up of assets, (e) any earnings of any subsidiary of such
Subsidiary unavailable for payment to such Subsidiary and (f) proceeds of any
life insurance policy.
13
"Notes" means the Revolving Credit Notes, the Swing Line Note and
Fronted Offshore Currency Notes, and "Note" means any one of such promissory
notes, in each case as the same may from time to time be amended, modified,
extended, renewed, supplemented or restated.
"Notice of Revolving Credit Borrowing" has the meaning set forth in
Section 2.04(a).
"Notice of Swing Line Borrowing" has the meaning set forth in Section
2.04(b).
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, all Letter of Credit Obligations and all accrued and
unpaid fees, expenses, reimbursements, indemnities and other obligations of the
Borrower or any Borrowing Subsidiary to the Administrative Agent, the Swing Line
Lender, the Offshore Currency Fronting Lender, the Letter of Credit Issuer, any
one or more of the Lenders and/or any indemnified party evidenced by or arising
under or in respect of any of the Loan Documents, including, without limitation,
obligations under a Swap Contract between the Borrower and a Lender or an
affiliate of a Lender relating to any of the Loans.
"Offshore Currency" means at any time, Euro, Pounds Sterling and, from
and after the time of approval by each Lender in accordance with Section
2.06(e), any other currency requested by Company.
"Offshore Currency Loans" means Fronted Offshore Currency Loans made by
the Offshore Currency Fronting Lender to the Borrowing Subsidiaries and
Revolving Credit Loans made by the Lenders to Borrower in an Offshore Currency.
"Offshore Currency Addendum" means an addendum substantially in the
form of Exhibit I hereto with such modifications thereto as shall be approved by
the Offshore Currency Fronting Lender and Administrative Agent.
"Offshore Currency Fronting Lender" means ▇▇▇▇▇ Fargo (or any
Affiliate, branch or agency thereof) to the extent it is party to an Offshore
Currency Addendum as the "Offshore Currency Fronting Lender" thereunder. If any
agency, branch or Affiliate of ▇▇▇▇▇ Fargo shall be a party to an Offshore
Currency Addendum, such agency, branch or Affiliate shall, to the extent of any
commitment extended and any Loans made by it, have all the rights of such Lender
hereunder; provided, however, that ▇▇▇▇▇ Fargo shall to the exclusion of such
agency, branch or Affiliate, continue to have all the voting rights vested in it
by the terms hereof.
"Offshore Currency Sublimit" means $30,000,000.00.
"Parent" means, with respect to any Lender, any Person controlling such
Lender.
"Participant" has the meaning set forth in Section 9.06(b).
"Payment Office" means the main office of the Administrative Agent
located in Denver, Colorado.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
14
"Permitted Acquisition" shall mean any Acquisition by the Borrower or
any Wholly-Owned Subsidiary so long as (a) the Acquired Business is in an
Eligible Line of Business, (b) the Acquisition is not a Hostile Acquisition, (c)
the Borrower has given the Administrative Agent at least ten (10) Business Days
prior written notice of such Acquisition (or such lesser notice as the Required
Lenders may agree to in writing) and has provided the Administrative Agent with
such financial and other information concerning such Acquisition as the
Administrative Agent or the Required Lenders may reasonably request (and the
Administrative Agent hereby agrees to promptly forward such notices and such
financial and other information to each of the Lenders), (d) if such Acquisition
involves a merger or consolidation of the Borrower or any Subsidiary and another
entity, the Borrower or such Subsidiary, as the case may be, is the surviving
entity, (e) the total purchase price (including fees and expenses) for such
Acquisition (whether payable at closing or at any time or times after closing of
the applicable Acquisition, and if payable after closing and not determinable
prior to closing, as reasonably estimated by the Borrower, and in any event
including the amount of any indebtedness assumed by the Borrower or any
Subsidiary as a part of such Acquisition) does not exceed the sum of
$65,000,000, (f) the total purchase price (including fees and expenses) for all
Acquisitions consummated by the Borrower and/or any Subsidiary during the one
(1) year period preceding the date of consummation of the Acquisition in
question (including the Acquisition in question) (whether payable at closing or
at any time or times after closing of the applicable Acquisition, and if payable
after closing and not determinable prior to closing, as reasonably estimated by
the Borrower, and in any event including the amount of any indebtedness assumed
by Borrower or any Subsidiary as a part of the applicable Acquisition) does not
exceed the sum of $65,000,000, (g) both immediately before and immediately after
giving effect to such Acquisition, the Borrower is in compliance with all of the
terms, provisions, covenants and conditions contained in this Agreement and the
other Loan Documents, (h) if such Acquisition had been consummated on the last
day of the Fiscal Quarter immediately preceding the actual date of such
Acquisition (the "Assumed Acquisition Date"), on a pro forma basis the Borrower
would have been in compliance with all of the terms, provisions, covenants and
conditions contained in this Agreement and the other Loan Documents at all times
from and after the Assumed Acquisition Date, which pro forma compliance shall be
demonstrated by the Borrower to the Administrative Agent and each Lender
pursuant to such financial and other information concerning such Acquisition as
the Administrative Agent or the Required Lenders may reasonably request, (i)
after giving effect to such Acquisition, the Consolidated Leverage Ratio does
not exceed 2.5 to 1.0, (j) the Acquired Business shall be owned directly by the
Borrower or a Wholly-Owned Subsidiary, (k) if a new Material Subsidiary is
formed or acquired as a result of or in connection with the Acquisition, the
Borrower shall have complied with the requirements of Section 5.17 in connection
therewith and (l) both immediately before and immediately after giving effect to
such Acquisition, no Default or Event of Default shall exist.
"Person" means an individual, a corporation, a partnership, a limited
liability company, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (a) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (b) has at
15
any time within the preceding five (5) years been maintained, or contributed to,
by any Person which was at such time a member of the ERISA Group for employees
of any Person which was at such time a member of the ERISA Group.
"Prime Rate" means at any time the rate of interest per annum most
recently announced within ▇▇▇▇▇ Fargo at its principal office in San Francisco,
California as its Prime Rate, with the understanding that ▇▇▇▇▇ Fargo's Prime
Rate is one of its base rates and serves as the basis upon which effective rates
of interest are calculated for those loans making reference thereto and is
evidenced by the recording thereof after its announcement in such internal
publication or publications as ▇▇▇▇▇ Fargo may designate. Each change in the
Prime Rate shall be effective on the day the change is announced within ▇▇▇▇▇
Fargo.
"Register" has the meaning set forth in Section 9.06(f).
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to reserve requirements applicable to member lenders of the Federal
Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as in effect from time to time and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to the extension of credit by lenders for the purpose of purchasing or
carrying margin stocks applicable to member lenders of the Federal Reserve
System.
"Reimbursement Agreement" means each application and/or agreement for
irrevocable standby letter of credit executed by Borrower in connection with any
Letter of Credit, each as the same may be amended, modified, extended, renewed,
supplemented or restated from time to time.
"Reimbursement Obligations" means, at any time, the aggregate (without
duplication) of the Obligations of the Borrower to the Letter of Credit Issuer,
the Administrative Agent and/or any Lender in respect of all unreimbursed
payments or disbursements made by the Letter of Credit Issuer, the
Administrative Agent and/or any Lender under or in respect of draws made under
any Letter of Credit.
"Required Lenders" means at any time Lenders having at least 50% of the
aggregate amount of the Revolving Credit Commitments or, if the Revolving Credit
Commitments shall have been terminated, holding Revolving Credit Notes
evidencing at least 50% of the aggregate unpaid principal amount of the
Revolving Credit Loans.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum, aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on eurocurrency
liabilities.
"Revolving Credit Commitment" means, with respect to any Lender, the
principal amount set forth opposite the name of such Lender on Schedule 1.01
hereto or in any Assignment and Assumption Agreement under the caption "Amount
of Revolving Credit
16
Commitment"; and "Revolving Credit Commitments" means such commitments
collectively, which commitments equal $100,000,000 in the aggregate as of the
Effective Date, as such amount may be reduced from time to time pursuant to
Section 2.11.
"Revolving Credit Commitment Percentage" means, with respect to each
Lender, the percentage equal to a fraction the numerator of which is the amount
of such Lender's Revolving Credit Commitment and the denominator of which is the
aggregate amount of the Revolving Credit Commitments.
"Revolving Credit Loan" means a loan made by a Lender pursuant to
Section 2.01, which may be a Base Rate Loan or a LIBOR Loan.
"Revolving Credit Notes" means revolving credit notes of the Borrower,
substantially in the form of Exhibit C hereto, evidencing the obligation of the
Borrower to repay the Revolving Credit Loans, and "Revolving Credit Note" means
any one of such revolving credit notes issued hereunder, in each case as the
same may from time to time be amended, modified, extended, renewed, supplemented
or restated.
"Spot Rate" for a currency means the rate quoted by ▇▇▇▇▇ Fargo as the
spot rate for the purchase by ▇▇▇▇▇ Fargo of such currency with another currency
at approximately 11:00 a.m. at the relevant foreign currency trading office of
▇▇▇▇▇ Fargo on the date two Business Days prior to the date as of which the
foreign exchange computation is made.
"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business entity
of which more than fifty percent (50%) of the voting capital stock, partnership
interests, membership interests or other equity interests is owned or controlled
directly or indirectly by such Person, or one or more of the Subsidiaries of the
Person, or a combination thereof. Unless the context otherwise clearly requires,
references herein to a "Subsidiary" refer to a Subsidiary of the Borrower or one
of its other Subsidiaries.
"Swap Contract" shall mean (a) any and all rate swap transactions,
basis swaps, credit derivative transactions, forward rate transactions,
commodity swaps, commodity options, forward commodity contracts, equity or
equity index swaps or options, bond or bond price or bond index swaps or options
or forward bond or forward bond price or forward bond index transactions,
interest rate options, forward foreign exchange transactions, cap transactions,
floor transactions, collar transactions, currency swap transactions,
cross-currency rate swap transactions, currency options, spot contracts or any
other similar transactions or any combination of any of the foregoing (including
any options to enter into any of the foregoing), whether or not any such
transaction is governed by or subject to any master agreement, and (b) any and
all transactions of any kind, and the related confirmations, which are subject
to the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement, or any other master agreement
(any such master agreement, together with any related schedules, a "Master
Agreement"), including any such obligations or liabilities under any Master
Agreement.
"Swap Termination Value" shall mean, in respect of any Swap Contract,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contract,
17
(a) for any date on or after the date such Swap Contract has been closed out and
a termination value determined in accordance therewith, such termination value
and (b) for any date prior to the date referenced in clause (a), the amount
determined as the ▇▇▇▇-to-market value for such Swap Contract, as determined
based upon one or more mid-market or other readily available quotations provided
by any recognized dealer in such Swap Contract (which may include a Lender or
any affiliate of a Lender).
"Swing Line Commitment" means the lesser of (a) $7,500,000 and (b) the
total Revolving Credit Commitments at such time.
"Swing Line Lender" means ▇▇▇▇▇ Fargo.
"Swing Line Lender-Related Persons" means the Swing Line Lender
(including any successor Swing Line Lender), together with its affiliates, and
the officers, directors, employees, agents and attorneys-in-fact of such Persons
and affiliates.
"Swing Line Loan" means a loan made by the Swing Line Lender pursuant
to Section 2.02.
"Swing Line Note" means the swing line note of the Borrower,
substantially in the form of Exhibit D hereto, evidencing the obligation of the
Borrower to repay the Swing Line Loans, as the same may from time to time be
amended, modified, extended, renewed, supplemented or restated.
"Synthetic Lease Obligation" of any Person means the obligation to pay
rent or other payment amounts under a lease of (or other indebtedness
arrangements conveying the right to use) real or personal property of such
Person which may be classified and accounted for as an operating lease or
off-balance sheet liability for accounting purposes but as a secured or
unsecured loan for tax purposes under the Internal Revenue Code.
"Termination Date" means October , 2009.
"Total Outstandings" means, as of any date, the sum of (a) the
aggregate principal amount of all Revolving Credit Loans outstanding as of such
date, plus (b) the aggregate principal amount of all Swing Line Loans
outstanding as of such date plus (c) the aggregate amount of all Fronted
Offshore Currency Loans outstanding as of such date plus (d) the aggregate
Letter of Credit Obligations outstanding as of such date.
"Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (a) the present value of all benefits under such Plan
exceeds (b) the fair market value of all Plan assets allocable to such benefits
(excluding any accrued but unpaid contributions), 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 ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"Upfront Fee Letter" means the letter agreement by and among the
Borrower, the Administrative Agent and the Lenders, dated as of the date of this
Agreement, relating to the
18
upfront fees payable to the Lenders, as amended, supplemented or otherwise
modified from time to time.
"Voting Stock" means capital stock of any class or classes (however
designated) having ordinary voting power for the election of directors of the
Borrower, other than stock having such power only by reason of the happening of
a contingency.
"▇▇▇▇▇ Fargo" means ▇▇▇▇▇ Fargo Bank, National Association, in its
individual capacity.
"Wholly-Owned Subsidiary" means, at any time, any Subsidiary one
hundred percent (100%) of all of the equity interests (except directors'
qualifying shares) and voting interests of which are owned by any one or more of
the Borrower and the Borrower's other Wholly-Owned Subsidiaries at such time.
Section 1.02 Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made and all financial statements
required to be delivered hereunder shall be prepared in accordance with GAAP as
in effect from time to time (recognizing that unaudited interim financial
statements may be subject to normal year-end adjustments and may not contain
footnotes), applied on a basis consistent (except for changes concurred in by
the Borrower's independent public accountants) with the most recent audited
consolidated financial statements of the Borrower and its Subsidiaries delivered
to the Lenders; provided that, if the Borrower notifies the Administrative Agent
that the Borrower wishes to amend any covenant in Article V to eliminate the
effect of any change in GAAP on the operation of such covenant (or if the
Administrative Agent notifies the Borrower that the Required Lenders wish to
amend any covenant in Article V for such purpose), then the Borrower's
compliance with such covenant shall be determined on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such covenant is amended in a manner satisfactory to
the Borrower and the Required Lenders.
Section 1.03 Types of Borrowings. The term "Borrowing" denotes the
aggregation of Revolving Credit Loans of one or more Lenders to be made to the
Borrower pursuant to Article II on a single date and, in the case of LIBOR Loans
and Offshore Currency Loans, for a single Interest Period. Borrowings may be
classified for purposes of this Agreement by reference to the pricing of
Revolving Credit Loans comprising such Borrowing (e.g., a "Base Rate Borrowing"
is a Borrowing comprised of Base Rate Loans, a "LIBOR Borrowing" is a Borrowing
comprised of LIBOR Loans and an "Offshore Currency Borrowing" is a Borrowing
comprised of Offshore Currency Loans).
ARTICLE II
THE CREDITS
Section 2.01 Revolving Credit Commitments. During the Credit
Availability Period, each Lender severally agrees, on the terms and conditions
set forth in this Agreement, to make loans to the Borrower pursuant to this
Section 2.01 from time to time in Dollars and Offshore Currencies in amounts
such that the aggregate outstanding principal amount of Revolving Credit Loans
by such Lender shall not exceed the amount of its Revolving Credit Commitment
less the sum of (i) such Lender's Revolving Credit Commitment Percentage of
Letter of Credit
19
Obligations at such time plus (ii) such Lender's Revolving Credit Commitment
Percentage of aggregate principal amount of Swing Line Loans outstanding at such
time plus (iii) such Lender's Revolving Credit Commitment Percentage of the
Dollar Equivalent of the aggregate principal amount of Fronted Offshore Currency
Loans outstanding at such time. The Dollar Equivalent of all Revolving Credit
Loans denominated in an Offshore Currency, when aggregated with the Dollar
Equivalent of all Fronted Offshore Currency Loans plus the Dollar Equivalent of
all Letter of Credit Obligations denominated in an Offshore Currency, shall not
exceed the Offshore Currency Sublimit. Each Borrowing under this Section 2.01
which is a Base Rate Borrowing shall be in an aggregate principal amount of
$1,000,000 or any larger multiple of $500,000. Each Borrowing under this Section
2.01 which is a LIBOR Borrowing or an Offshore Currency Borrowing shall be in an
aggregate principal amount of $2,000,000 or any larger multiple of $500,000.
Each Borrowing under this Section 2.01 shall be made from the several Lenders
ratably in proportion to their respective Revolving Credit Commitments. Within
the foregoing limits, the Borrower may borrow under this Section 2.01, repay, or
to the extent permitted by Section 2.13, prepay Revolving Credit Loans and
reborrow at any time during the Credit Availability Period under this Section
2.01.
Section 2.02 Swing Line Commitment.
(a) During the Credit Availability Period, the Swing Line
Lender agrees, on the terms and conditions set forth in this Agreement, to make
loans to the Borrower pursuant to this Section 2.02 from time to time in amounts
such that the aggregate outstanding principal amount of Swing Line Loans shall
not exceed the lesser of (i) the amount of the Swing Line Commitment or (ii) the
sum of (A) the total Revolving Credit Commitments at such time minus (B) the
aggregate principal amount of Revolving Credit Loans outstanding at such time
minus (C) the aggregate principal amount of Fronted Offshore Currency Loans
outstanding at such time minus (D) the aggregate amount of Letter of Credit
Obligations at such time. No Swing Line Loan may be outstanding for more than
ten (10) Business Days. The Swing Line Lender shall not make any Swing Line Loan
to refinance any outstanding Swing Line Loan. Immediately upon the making of a
Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such Swing Line Loan in an amount equal to the product of such
Lender's Revolving Credit Commitment Percentage of the amount of such Swing Line
Loan. Within the foregoing limits, the Borrower may borrow under this Section
2.02, repay or prepay Swing Line Loans and reborrow at any time during the
Credit Availability Period under this Section 2.02.
(b) The Swing Line Lender may at any time in its sole and
absolute discretion request, on behalf of the Borrower (which hereby irrevocably
requests the Swing Line Lender to so request on its behalf), that each Lender
make a Revolving Credit Loan which is a Base Rate Loan in an amount equal to
such Lender's Revolving Credit Commitment Percentage of the amount of Swing Line
Loans then outstanding. Such request shall be made in accordance with the
requirements of Section 2.04 and shall be subject to the conditions set forth in
Article III. The Swing Line Lender shall furnish the Borrower with a copy of the
applicable Notice of Revolving Credit Borrowing promptly after delivering such
notice to the Administrative Agent. Not later than 2:00 p.m. (Central Standard
Time) on the date of such Revolving Credit Loan, each Lender shall make an
amount equal to its Revolving Credit Commitment Percentage of the amount
specified in such Notice of Revolving Credit Borrowing available, in Federal or
other funds immediately available in Denver, Colorado, to the Administrative
Agent at its Payment
20
Office. Unless the Administrative Agent determines that any applicable condition
specified in Article III has not been satisfied, the Administrative Agent will
make the funds so received from the Lenders available to the Swing Line Lender
at the Administrative Agent's aforesaid address to pay the then outstanding
Swing Line Loans, whereupon, subject to Section 2.02(c) below, each Lender that
so makes funds available shall be deemed to have made a Revolving Credit Loan
which is a Base Rate Loan to the Borrower in such amount.
(c) If for any reason any Revolving Credit Loan cannot be
requested in accordance with Section 2.02(b) above or any Swing Line Loan cannot
be refinanced by such a Revolving Credit Loan, the Notice of Revolving Credit
Borrowing submitted by the Swing Line Lender shall be deemed to be a request by
the Swing Line Lender that each of the Lender's fund its risk participation in
the relevant Swing Line Loan and each Lender's payment to the Administrative
Agent for the account of the Swing Line Lender pursuant to Section 2.02(b) above
shall be deemed payment in respect of such participation.
(d) If any Lender fails to make available to the
Administrative Agent for the account of the Swing Line Lender any amount
required to be paid by such Lender pursuant to the foregoing provisions of
Section 2.02(b) by the time specified in Section 2.02(b), the Swing Line Lender
shall be entitled to recover from such Lender (acting through the Administrative
Agent), on demand, such amount with interest thereon for the period from the
date such payment is required to the date on which such payment is immediately
available to the Swing Line Lender at a rate per annum equal to the Federal
Funds Effective Rate from time to time in effect. A certificate of the Swing
Line Lender submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under Section 2.02 shall be conclusive absent
manifest error.
(e) Each Lender's obligation to make Revolving Loans or to
purchase and fund risk participations in Swing Line Loans pursuant to this
Section 2.02 shall be absolute and unconditional and shall not be affected by
any circumstance, including (i) any set-off, counterclaim, recoupment, defense
or other right which such Lender may have against the Swing Line Lender, the
Borrower or any other Person for any reason whatsoever, (ii) the occurrence or
continuance of a Default or Event of Default or (iii) any other occurrence,
event or condition, whether or not similar to any of the foregoing; provided,
however, that each Lender's obligation to make Revolving Credit Loans pursuant
to Section 2.02(b) is subject to the conditions set forth in Article III. Any
such purchase of participations shall not relieve or otherwise impair the
obligation of the Borrower to repay Swing Line Loans, together with interest as
provided herein.
(f) At any time after any Lender has purchased and funded a
participation in a Swing Line Loan, if the Swing Line Lender receives any
payment on account of such Swing Line Loan, the Swing Line Lender will
distribute to such Lender its pro rata share of such payment (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender's participation was outstanding and funded) in the same funds
as those received by the Swing Line Lender and in accordance with the time
frames set forth in Section 2.14.
(g) If any payment received by the Swing Line Lender in
respect of principal or interest on any Swing Line Loan is required to be
returned by the Swing Line Lender, each Lender shall pay to the Swing Line
Lender its pro rata share thereof on demand of the Administrative Agent, plus
interest thereon from the date of such demand if such demand is made
21
by 2:00 p.m. (Central Standard Time) on such day or from the day after the date
of such demand if such demand is made after 2:00 p.m. (Central Standard Time) on
such day to the date such amount is returned if such return is made by 4:00 p.m.
(Central Standard Time) on such day or to the day after the date of such return
if such return is made after 4:00 p.m. (Central Standard Time) on such day, at a
rate per annum equal to the Federal Funds Effective Rate. The Administrative
Agent will make such demand upon the request of the Swing Line Lender.
(h) Until each Lender funds its Revolving Credit Loan or
participation pursuant to this Section 2.02 to refinance such Lender's Revolving
Credit Commitment Percentage of any Swing Line Loan, interest in respect of such
pro rata share shall be solely for the account of the Swing Line Lender.
Section 2.03 Fronted Offshore Currency Loans.
(a) During the Credit Availability Period, the Offshore
Currency Fronting Lender agrees, on the terms and conditions set forth in this
Agreement and in the applicable Offshore Currency Addendum, to make Fronted
Offshore Currency Loans under such Offshore Currency Addendum to the Borrowing
Subsidiary party to such Offshore Currency Addendum from time to time in the
applicable Offshore Currency, in amounts such that the aggregate outstanding
principal amount of Fronted Offshore Currency Loans shall not exceed the lesser
of (i) the amount of the Fronted Offshore Currency Commitment or (ii) the sum of
(A) the total Revolving Credit Commitments at such time minus (B) the aggregate
principal amount of Revolving Credit Loans outstanding at such time minus (C)
the aggregate principal amount of Swing Line Loans outstanding at such time
minus (D) the aggregate amount of Letter of Credit Obligations at such time;
provided, that, at no time shall the Dollar Equivalent of the Fronted Offshore
Currency Loans for any specific Alternate Currency exceed the maximum amount
specified for such Alternate Currency in the applicable Offshore Currency
Addendum; and, provided further, that, at no time shall the Dollar Equivalent of
all Fronted Offshore Currency Loans, when aggregated with the Dollar Equivalent
of all Revolving Credit Loans and Letter of Credit Obligations denominated in an
Offshore Currency, exceed the Offshore Currency Sublimit. Within the foregoing
limits, the applicable Borrowing Subsidiary may borrow under this Section 2.03,
repay, or to the extent permitted by Section 2.13, prepay Fronted Offshore
Currency Loans and reborrow at any time during the Credit Availability Period
under this Section 2.03. All such Fronted Offshore Currency Loans shall be
subject to an unlimited continuing guaranty of payment by the Borrower and by
all Domestic Subsidiaries which are Material Subsidiares.
(b) Except as otherwise required by applicable law, in no
event shall the Offshore Currency Fronting Lender have the right to accelerate
the Fronted Offshore Currency Loans outstanding under any Offshore Currency
Addendum prior to the stated termination date in respect thereof, except that
the Offshore Currency Fronting Lender shall have such rights upon an
acceleration of the Loans and a termination of the Revolving Credit Commitments
pursuant to Section 6.
(c) The Offshore Currency Fronting Lender shall furnish to
Administrative Agent not less frequently than monthly, at the end of each
calendar quarter, and at any other time upon the request of Administrative
Agent, a statement setting forth the outstanding Fronted
22
Offshore Currency Loans made and repaid under each applicable Offshore Currency
Addendum during the period since the last such report under such Offshore
Currency Addendum.
(d) Immediately and automatically upon the occurrence of an
Event of Default under Sections 6.01(a),(g) or (h), each Lender shall be deemed
to have unconditionally and irrevocably purchased from the Offshore Currency
Fronting Lender, without recourse or warranty, an undivided interest in and
participation in each Fronted Offshore Currency Loan ratably in an amount equal
to such Lender's Revolving Credit Commitment Percentage of the amount of such
Loan, and immediately and automatically all Fronted Offshore Currency Loans
shall be converted to and redenominated in Dollars equal to the Dollar
Equivalent of each such Fronted Offshore Currency Loan determined as of the date
of such conversion; provided, that to the extent such conversion shall occur
other than at the end of an Interest Period, the applicable Borrowing Subsidiary
shall pay to the Offshore Currency Fronting Lender all losses and breakage costs
related thereto in accordance with Section 2.15. Each of the Lenders shall pay
to the Offshore Currency Fronting Lender not later than two (2) Business Days
following a request for payment from the Offshore Currency Fronting Lender, in
Dollars, an amount equal to the undivided interest in and participation in the
Fronted Offshore Currency Loan purchased by such Lender pursuant to this Section
2.03(d). In the event that any Lender fails to make payment to the applicable
Offshore Currency Fronting Lender of any amount due under this Section 2.03(d),
Administrative Agent shall be entitled to receive, retain and apply against such
obligation the principal and interest otherwise payable to such Lender hereunder
until the Agent receives from such Lender an amount sufficient to discharge such
Lender's payment obligation as prescribed in this Section 2.03(d) together with
interest thereon at the Federal Funds Effective Rate for each day during the
period commencing on the date of demand by the Offshore Currency Fronting Lender
and ending on the date such obligation is fully satisfied. Administrative Agent
will promptly remit all payments received as provided above to the Offshore
Currency Fronting Lender. In consideration of the risk participations described
in this Section 2.03(d), each Lender shall receive, from the accrued interest
paid for periods prior to the conversion of any Fronted Offshore Currency Loan
as described above by the applicable Borrowing Subsidiary on each Fronted
Offshore Currency Loan, a fee equal to such Lender's Revolving Credit Commitment
Percentage of the Applicable LIBOR Margin component of the interest accrued on
such Loan, as in effect from time to time during the period such interest
accrued. Such portion of the interest paid by or on behalf of the applicable
Borrowing Subsidiary on Fronted Offshore Currency Loans to the Offshore Currency
Fronting Lender shall be paid as promptly as possible by the Offshore Currency
Fronting Lender to Administrative Agent, and Administrative Agent shall as
promptly as possible convert such amount into Dollars at the Spot Rate in
accordance with its normal banking practices and apply such resulting amount
ratably among the Lenders (including the Offshore Currency Fronting Lender) in
proportion to their respective Revolving Credit Commitment Percentages.
(e) Whenever, at any time after a Lender has purchased a
participating interest in a Fronted Offshore Currency Loan, the Offshore
Currency Fronting Lender receives any payment on account thereof, the Offshore
Currency Fronting Lender will distribute to Administrative Agent for delivery to
each Lender its participating interest in such amount (appropriately adjusted,
in the case of interest payments, to reflect the period of time during which
such Lender's participating interest was outstanding and funded); provided,
however, that in the event that such payment received by the Offshore Currency
Fronting Lender is required to be returned, such Lender will return to
Administrative Agent for delivery to the Offshore
23
Currency Fronting Lender any portion thereof previously distributed by
Administrative Agent or such Offshore Currency Fronting Lender to it.
(f) Each Lender's obligation to purchase the participating
interests referred to in subsection 2.03(d) shall be absolute and unconditional
and shall not be affected by any circumstance, including, without limitation,
(i) any set-off, counterclaim, recoupment, defense or other right which such
Lender or any Borrower may have against the Offshore Currency Fronting Lender,
the Borrower or any other Person for any reason whatsoever, (ii) the occurrence
or continuance of a Default or an Event of Default, (iii) any adverse change in
the condition (financial or otherwise) of Borrower, any Borrowing Subsidiary or
any Guarantor Subsidiary, (iv) any breach of this Agreement or any other Loan
Document by Borrower, any Borrowing Subsidiary or any Guarantor Subsidiary or
any other Lender, or (v) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.
(g) Notwithstanding anything herein to the contrary, during
the existence of an Event of Default, upon the request of the Required Lenders,
all or any part of any outstanding Fronted Offshore Currency Loans shall be
redenominated and converted into Base Rate Loans in Dollars assumed by Borrower
with effect from the last day of the Interest Period with respect to any such
Fronted Offshore Currency Loans. Administrative Agent will promptly notify the
Borrowing Subsidiaries of any such redenomination and conversion request.
(h) On or after the Effective Date, with the consent of
Administrative Agent, which consent shall not be unreasonably withheld, Borrower
may designate any Foreign Subsidiary as a Borrowing Subsidiary by delivery to
Administrative Agent of a Borrowing Subsidiary Supplement executed by such
Foreign Subsidiary and Borrower, together with a Fronted Offshore Currency Note
in favor of the Offshore Currency Fronting Lender and an Offshore Currency
Addendum, and upon such delivery such Foreign Subsidiary shall for all purposes
of this Agreement be a Borrowing Subsidiary and party to this Agreement;
provided, however, that Borrower shall not request, and will not permit any of
its Subsidiaries to request, and Offshore Currency Fronting Lender shall not
enter into, any Offshore Currency Addendum, or amendment to an existing Offshore
Currency Addendum, that would result in the sum of the Fronted Offshore Currency
Commitments and the Dollar Equivalent of the outstanding Revolving Credit Loans
and Letter of Credit Obligations denominated in an Offshore Currency exceeding
the Offshore Currency Sublimit. For the avoidance of doubt, the parties agree
that the Offshore Currency Fronting Lender shall be under no obligation to enter
into any Offshore Currency Addendum. As soon as practicable upon receipt of a
Borrowing Subsidiary Supplement, Administrative Agent will deliver a copy
thereof to each Lender. So long as the principal of and interest on all Loans
made to any Borrowing Subsidiaries under this Agreement shall have been paid in
full and all other obligations of such Borrowing Subsidiaries shall have been
fully performed, such Borrowing Subsidiary may, upon not less than five Business
Days' prior written notice to Administrative Agent and the Offshore Currency
Fronting Lender (which shall promptly notify the Lenders thereof), terminate its
status as a Borrowing Subsidiary.
Section 2.04 Notice of Borrowings.
(a) Notice of Revolving Credit Borrowings. The Borrower shall
give the Administrative Agent notice in the form of Exhibit A attached hereto (a
"Notice of Revolving Credit Borrowing") not later than (x) 10:00 a.m. (Central
Standard Time) on the Business Day
24
of each Base Rate Borrowing in Dollars, (y) 10:00 a.m. (Central Standard Time)
on the third Business Day before each LIBOR Borrowing in Dollars, and (z) 10:00
a.m. (Central Standard Time) on the fourth Business Day before each Borrowing in
an Offshore Currency specifying:
(i) the date of such Borrowing, which shall be a
Business Day,
(ii) the aggregate amount of such Borrowing in
Dollars or Offshore Currency,
(iii) if in Dollars, whether the Revolving Credit
Loans comprising such Borrowing are to be Base Rate Loans or LIBOR Loans, and
(iv) in the case of a LIBOR Borrowing or an Offshore
Currency Borrowing, the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period.
(b) Notice of Swing Line Borrowings. The Borrower shall give
the Administrative Agent notice in the form of Exhibit B attached hereto (a
"Notice of Swing Line Borrowing") not later than 12:00 noon (Central Standard
Time) on the date of each Swing Line Loan, specifying:
(i) the date of such Swing Line Loan, which shall be
a Business Day, and
(ii) the aggregate amount of such Swing Line Loan.
(c) Notice of Fronted Offshore Currency Borrowings. The
applicable Borrowing Subsidiary shall give the Administrative Agent and the
Offshore Currency Fronting Lender notice of each Fronted Offshore Currency Loan
in the manner and the form provided for in the applicable Offshore Currency
Addendum.
(d) Conversion and Continuation of Outstanding Advances. Base
Rate Borrowings shall continue as Base Rate Borrowings unless and until such
Base Rate Borrowings are converted into LIBOR Loans pursuant to this Section
2.04 or are repaid in accordance with this Article II. Each LIBOR Borrowing
shall continue as a LIBOR Borrowing until the end of the then applicable
Interest Period therefor, at which time such LIBOR Borrowing shall be
automatically converted into a Base Rate Borrowing unless (x) such LIBOR
Borrowing is or was repaid in accordance with this Article II or (y) the
Borrower shall have given the Administrative Agent a Conversion/Continuation
Notice (as defined below) at least three (3) Business Days prior to the
expiration of the current Interest Period requesting that, at the end of such
Interest Period, such LIBOR Borrowing continue as a LIBOR Borrowing for the same
or another Interest Period. Each Offshore Currency Borrowing shall continue as
an Offshore Currency Borrowing until the end of the then applicable Interest
Period therefor, at which time such Offshore Currency Borrowing shall continue
as an Offshore Currency Borrowing for an identical Interest Period unless (x)
such Offshore Currency Borrowing is or was repaid in accordance with this
Article II or (y) the Borrower shall have given the Administrative Agent notice
not later than 10:00 a.m. (Central Standard Time) at least four (4) Business
Days prior to the expiration of the current Interest Period requesting that at
the end of such Interest Period, such Offshore Currency
25
Borrowing continue for a different Interest Period. The Borrower may elect from
time to time to convert all or any part of a Base Rate Borrowing into a LIBOR
Borrowing, provided that the resulting Borrowings shall be in a minimum amount
of $2,000,000 or any larger multiple of $500,000. The Borrower shall give the
Administrative Agent irrevocable notice (a "Conversion/Continuation Notice") of
each conversion of a Base Rate Borrowing into a LIBOR Borrowing or continuation
of a LIBOR Borrowing not later than 10:00 a.m. (Central Standard Time) at least
three (3) Business Days prior to the date of the requested conversion or
continuation, specifying:
(i) the requested date, which shall be a Business
Day, of such conversion or continuation,
(ii) the aggregate amount of the Borrowing which is
to be converted or continued and whether such Borrowing is a Base Rate Borrowing
or a LIBOR Borrowing, and
(iii) the amount of such Borrowing which is to be
converted into or continued as a LIBOR Borrowing and the duration of the
Interest Period applicable thereto.
In no event shall Borrower be permitted more than ten (10) Interest Periods
outstanding at any one time under this Agreement. Notwithstanding the foregoing,
so long as any Default or Event of Default has occurred and is continuing, the
Borrower shall not be permitted to continue any LIBOR Borrowing as a LIBOR
Borrowing or to convert any Base Rate Borrowing into a LIBOR Borrowing.
Section 2.05 Notice to Lenders; Funding of Loans.
(a) Upon receipt of a Notice of Revolving Credit Borrowing,
the Administrative Agent shall notify each Lender of the contents thereof by
12:00 noon (Central Standard Time) on the date of the Administrative Agent's
receipt thereof if received by the Administrative Agent at or prior to 10:00
a.m. (Central Standard Time) on a Business Day or by 10:00 a.m. (Central
Standard Time) on the first Business Day after the date of the Administrative
Agent's receipt thereof if received by the Administrative Agent after 10:00 a.m.
(Central Standard Time) on a Business Day or on a day which is not a Business
Day, and of such Lender's share of such Borrowing and such Notice of Revolving
Credit Borrowing shall not thereafter be revocable by the Borrower. If the
Notice of Revolving Credit Borrowing is in an Offshore Currency, the
Administrative Agent shall notify each Lender of the Dollar Equivalent thereof
and the applicable Spot Rate used by Administrative Agent to determine the
Dollar Equivalent amount.
(b) Upon receipt of a Notice of Swing Line Borrowing, the
Administrative Agent shall promptly notify the Swing Line Lender of the contents
thereof and such Notice of Swing Line Borrowing shall not thereafter be
revocable by the Borrower.
(c) Upon receipt of a Notice of Fronted Offshore Currency
Borrowing, the Administrative Agent shall promptly notify the Offshore Currency
Fronting Lender of the contents thereof and such Notice of Fronted Offshore
Currency Borrowing shall not thereafter be revocable by the Borrower.
26
(d) Not later than 2:00 p.m. (Central Standard Time) on the
date of each Revolving Credit Loan, each Lender shall (except as provided in
subsection (e) of this Section) make available its share of such Borrowing, in
Federal or other funds immediately available in Denver, Colorado, to the
Administrative Agent at its Payment Office. Unless the Administrative Agent has
received written notice from Borrower or any Lender, or otherwise determines,
that any applicable condition specified in Article III has not been satisfied,
the Administrative Agent will make the funds so received from the Lenders
available to the Borrower at the Administrative Agent's aforesaid address.
(e) Not later than 2:00 p.m. (Central Standard Time) on the
date of each Swing Line Loan, the Swing Line Lender shall make available the
principal amount of such Swing Line Loan, in Federal or other funds immediately
available in Denver, Colorado, to the Administrative Agent at its Payment
Office. Unless the Administrative Agent has received written notice from
Borrower or any Lender, or otherwise determines, that any applicable condition
specified in Article III has not been satisfied, the Administrative Agent will
make the funds so received from the Swing Line Lender available to the Borrower
at the Administrative Agent's aforesaid address.
(f) Subject to the terms of this Agreement and the applicable
Offshore Currency Addendum, the Offshore Currency Fronting Lender shall make
available the principal amount of each Fronted Offshore Currency Loan to the
applicable Borrowing Subsidiary in accordance with the terms of the Offshore
Currency Addendum.
(g) If new Revolving Credit Loans are to be made hereunder on
a day on which the Borrower is to prepay or repay all or any part of outstanding
Revolving Credit Loans, the Lenders shall apply the proceeds of the new
Revolving Credit Loans to make such repayment and only an amount equal to the
difference (if any) between the amount being borrowed and the amount being
prepaid or repaid shall be made available by the Lenders to the Administrative
Agent as provided in subsection (c) above, or remitted by the Borrower to the
Administrative Agent as provided in Section 2.13, as the case may be. In such
case, the incurrence of such new Revolving Credit Loans and the prepayment or
repayment of such outstanding Revolving Credit Loans shall be deemed to have
occurred simultaneously.
(h) Unless the Administrative Agent shall have received notice
from a Lender prior to the date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender's share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
to the Administrative Agent on the date of such Borrowing in accordance with
subsections (d) and (e) of this Section 2.05 and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Lender ("Defaulting
Lender") shall not have so made such share available to the Administrative
Agent, such Defaulting Lender and the Borrower severally agree to repay to the
Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to
the Borrower until the date such amount is repaid to the Administrative Agent,
at (i) in the case of the Borrower, a rate per annum equal to the interest rate
applicable thereto pursuant to Section 2.09 and (ii) in the case of such
Defaulting Lender, the Federal Funds Effective Rate. If a Defaulting Lender
shall repay to the Administrative Agent such corresponding amount, such amount
so repaid shall constitute such Defaulting Lender's
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Revolving Credit Loan included in such Borrowing for purposes of this Agreement.
In addition, until such amount is paid in full by the Defaulting Lender to the
Administrative Agent, (a) the Defaulting Lender grants the Administrative Agent
the unconditional and irrevocable right of setoff against any amounts
(including, without limitation, payments of principal, interest and fees, as
well as indemnity payments) received by the Administrative Agent under this
Agreement for the benefit of such Defaulting Lender and (b) if such failure to
pay shall continue for a period of fifteen (15) or more Business Days, the
Defaulting Lender shall forfeit any right to vote on any matter that (i) the
Required Lenders or (ii) all of the Lenders are permitted to vote for under this
Agreement or any other Loan Document (and the calculation, and definition, of
Required Lenders shall exclude such Defaulting Lender's interest in the
Revolving Credit Commitments, the Revolving Credit Notes and the Revolving
Credit Loans); provided, however, once such a failure is cured, then such
Defaulting Lender shall, subsequent thereto, regain all of its voting rights
under this Agreement and the other Loan Documents.
(i) Unless the Administrative Agent shall have received notice
from the Swing Line Lender prior to the date of any Swing Line Loan that the
Swing Line Lender will not make available to the Administrative Agent such Swing
Line Loan, the Administrative Agent may assume that the Swing Line Lender has
made such share available to the Administrative Agent on the date of such Swing
Line Loan in accordance with subsection (d) of this Section 2.05 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that the
Swing Line Lender shall not have so made such share available to the
Administrative Agent, the Swing Line Lender and the Borrower severally agree to
repay to the Administrative Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Borrower, a rate per annum equal
to the higher of the Federal Funds Effective Rate and the interest rate
applicable thereto pursuant to Section 2.09 and (ii) in the case of the Swing
Line Lender, the Federal Funds Effective Rate. If the Swing Line Lender shall
repay to the Administrative Agent such corresponding amount, such amount so
repaid shall constitute a Swing Line Loan for purposes of this Agreement.
Section 2.06 Utilization of Commitments in Offshore Currencies.
(a) Administrative Agent will determine the Dollar Equivalent
with respect to (i) any Borrowing comprised of Offshore Currency Loans (A) as of
the requested date of Borrowing, (B) as of the last Business Day of each month
and (C) as of any redenomination date pursuant to this Section 2.06 and (ii) any
Letter of Credit denominated in an Offshore Currency (A) as of the date of
issuance thereof and (B) as of the last Business Day of each week (each such
date under clauses (i) and (ii) a "Computation Date"). Administrative Agent will
provide Borrower with the amount determined pursuant to the foregoing clause (i)
and (ii) promptly following the end of each month.
(b) In the case of a proposed Borrowing of Revolving Credit
Loans comprised of Offshore Currency Loans, Lenders shall be under no obligation
to make Offshore Currency Loans in the requested Offshore Currency as part of
such Borrowing if Administrative Agent has received notice from any Lender by
3:00 p.m. (Central Standard Time) three Business Days prior to the day of such
Borrowing that such Lender cannot provide Loans in the requested Offshore
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Currency, in which event Administrative Agent will give notice to Borrower no
later than 9:00 a.m. (Central Standard Time) on the third Business Day prior to
the requested date of such Borrowing that the Borrowing in the requested
Offshore Currency is not then available, no such Borrowing shall be made and any
request for a Revolving Credit Loan in such Offshore Currency shall be deemed
withdrawn and shall otherwise be without effect.
(c) In the case of a proposed continuation of Revolving Credit
Loans comprised of Offshore Currency Loans for an additional Interest Period
pursuant to Section 2.04, Lenders shall be under no obligation to continue such
Offshore Currency Loans if Administrative Agent has received notice from any
Lender by 4:00 p.m. (Central Standard Time) three Business Days prior to the day
of such continuation that such Lender cannot continue to provide Loans in the
Offshore Currency, in which event Administrative Agent will give notice to
Borrower not later than 9:00 a.m. (Central Standard Time) on the second Business
Day prior to the requested date of such continuation that the continuation of
such Offshore Currency Loans in the Offshore Currency is not then available, and
notice thereof also will be given promptly by Administrative Agent to Lenders.
If Administrative Agent shall have so notified Borrower that any such
continuation of Offshore Currency Loans is not then available, any Notice of
Revolving Credit Borrowing with respect thereto shall be deemed withdrawn and
such Offshore Currency Loans shall be redenominated into Base Rate Loans with
effect from the last day of the Interest Period with respect to any such
Offshore Currency Loans. Administrative Agent will promptly notify Borrower and
Lenders of any such redenomination and, in such notice by Administrative Agent
to each Lender, Administrative Agent will state the aggregate Dollar Equivalent
of the redenominated Offshore Currency Loans as of the Computation Date with
respect thereto and such Lender's pro rata share thereof.
(d) Notwithstanding anything herein to the contrary, during
the existence of an Event of Default, upon the request of Required Lenders, all
or any part of any outstanding Offshore Currency Loans shall be redenominated
and converted into Base Rate Loans in Dollars assumed by Borrower with effect
from the last day of the Interest Period with respect to any such Offshore
Currency Loans. Administrative Agent will promptly notify the Borrower and the
Borrowing Subsidiaries of any such redenomination and conversion request.
(e) Borrower shall be entitled to request that Revolving
Credit Loans hereunder shall also be permitted to be made in any other lawful
currency constituting a eurocurrency, in addition to the currencies specified in
the definition of "Offshore Currency" herein, that in the opinion of each Lender
is at such time freely traded in the offshore interbank foreign exchange markets
and is freely transferable and freely convertible into Dollars (an "Agreed
Alternative Currency"). Borrower shall deliver to Administrative Agent any
request for designation of an Agreed Alternative Currency to be received by
Administrative Agent not later than noon (Central Standard Time) at least ten
Business Days in advance of the date of any Borrowing hereunder proposed to be
made in such Agreed Alternative Currency. Upon receipt of any such request
Administrative Agent will promptly notify Lenders thereof, and each Lender will
use its best efforts to respond to such request within two Business Days of
receipt thereof. Each Lender may grant or accept such request in its sole
discretion. Administrative Agent will promptly notify Company of the acceptance
or rejection of any such request.
Section 2.07 Notes.
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(a) The Revolving Credit Loans of each Lender shall be
evidenced by a single Revolving Credit Note substantially in the form of Exhibit
D hereto payable to the order of such Lender for the account of its Applicable
Lending Office in an amount equal to the amount of such Lender's Revolving
Credit Commitment.
(b) The Swing Line Loans shall be evidenced by a single Swing
Line Note substantially in the form of Exhibit E hereto payable to the order of
the Swing Line Lender for the account of its Applicable Lending Office in an
amount equal to the amount of the Swing Line Commitment.
(c) The Fronted Offshore Currency Loans shall be evidenced by
the Fronted Offshore Currency Notes executed and delivered by the Borrowing
Subsidiaries in accordance with the terms of the Offshore Currency Addenda.
(d) Upon receipt of each Lender's Revolving Credit Note
pursuant to Section 3.01(b), the Administrative Agent shall deliver such
Revolving Credit Note to such Lender. Each Lender shall record in its books and
records the date, amount, type and Interest Period (if any) of each Revolving
Credit Loan made by it and the date and amount of each payment of principal
and/or interest made by the Borrower with respect thereto; provided that the
obligation of the Borrower to repay each Revolving Credit Loan shall be absolute
and unconditional, notwithstanding any failure of such Lender to make any such
recordation or any mistake by such Lender in connection with any such
recordation. The books and records of each Lender showing the account between
such Lender and the Borrower shall be prima facie evidence of the items set
forth therein in the absence of manifest error.
(e) Upon receipt of the Swing Line Note pursuant to Section
3.01(c), the Administrative Agent shall deliver such Swing Line Note to the
Swing Line Lender. The Swing Line Lender shall record in its books and records
the date and amount of each Swing Line Loan made by it and the date and amount
of each payment of principal and/or interest made by the Borrower with respect
thereto; provided that the obligation of the Borrower to repay each Swing Line
Loan shall be absolute and unconditional, notwithstanding any failure of the
Swing Line Lender to make any such recordation or any mistake by the Swing Line
Lender in connection with any such recordation. The books and records of the
Swing Line Lender showing the account between the Swing Line Lender and the
Borrower shall be prima facie evidence of the items set forth therein in the
absence of manifest error.
(f) Upon receipt of a Fronted Offshore Currency Note pursuant
to Section 2.03(f), the Administrative Agent shall deliver such Fronted Offshore
Currency Note to the Offshore Currency Fronting Lender. The Offshore Currency
Fronting Lender shall record in its books and records the date and amount of
each Fronted Offshore Currency Loan made by it and the date and amount of each
payment of principal and/or interest made by the applicable Borrowing Subsidiary
with respect thereto; provided that the obligation of the Borrowing Subsidiary
to repay each Fronted Offshore Currency Loan shall be absolute and
unconditional, notwithstanding any failure of the Offshore Currency Fronting
Lender to make any such recordation or any mistake by the Offshore Currency
Fronting Lender in connection with any such recordation. The books and records
of the Offshore Currency Fronting Lender showing the account between the
Offshore Currency Fronting Lender and the Borrowing Subsidiary shall be prima
facie evidence of the items set forth therein in the absence of manifest error.
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Section 2.08 Payment of Obligations.
(a) Each Revolving Credit Loan and each Fronted Offshore
Currency Loan shall mature, and the principal amount thereof shall be due and
payable, on the Termination Date.
(b) Each Swing Line Loan shall mature, and the principal
amount thereof shall be due and payable, on the earlier of (i) the date which is
ten (10) Business Days after the date of such Swing Line Loan or (ii) the
Termination Date.
(c) If on any Computation Date, the Dollar Equivalent of the
Total Outstandings exceeds the aggregate amount of the Revolving Credit
Commitments, the Borrower shall pay an amount equal to such excess to
Administrative Agent within three (3) Business Days following demand by the
Administrative Agent. Each such payment shall be applied to prepay ratably the
Revolving Credit Loans of the Lenders.
(d) If on any Computation Date, the Dollar Equivalent of the
outstanding principal balance of Revolving Credit Loans denominated in an
Offshore Currency and Letter of Credit Obligations denominated in an Offshore
Currency plus the Dollar Equivalent of the outstanding principal balance of
Fronted Offshore Currency Loans exceed the Offshore Currency Sublimit, the
Borrower shall pay an amount equal to such excess to Administrative Agent within
three (3) Business Days following demand by the Administrative Agent. Each such
payment shall be applied to prepay ratably the Revolving Credit Loans of the
Lenders.
(e) If on any Computation Date, the Dollar Equivalent of the
outstanding principal balance of Fronted Offshore Currency Loans made pursuant
to any Offshore Currency Addendum exceed the Fronted Offshore Currency
Commitment set forth in such Offshore Currency Addendum, the applicable
Borrowing Subsidiary shall pay an amount equal to such excess to Administrative
Agent within three (3) Business Days following demand by the Administrative
Agent. Each such payment shall be applied to prepay the applicable Fronted
Offshore Currency Loans of the Offshore Currency Fronting Lender.
(f) All other Obligations, to the extent not theretofore paid,
shall be paid in full on the Termination Date.
Section 2.09 Interest Rates.
(a) So long as no Event of Default has occurred and is
continuing, each Base Rate Loan shall bear interest on the outstanding principal
amount thereof, for each day from the date such Revolving Credit Loan is made
until it becomes due, at a rate per annum equal to the Adjusted Base Rate for
such day. So long as any Event of Default has occurred and is continuing, each
Base Rate Loan shall bear interest on the outstanding principal amount thereof,
for each day from the date such Base Rate Loan is made until it becomes due, at
a rate per annum equal to the sum of 2% plus the Adjusted Base Rate for such
day. Such interest shall be due and payable quarterly in arrears on the last
Business Day of each calendar quarter and at the maturity of the Revolving
Credit Notes (whether by reason of acceleration or otherwise). Any overdue
principal of or interest on any Base Rate Loan shall bear interest, due and
payable on
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demand, for each day from and including the date payment thereof was due to but
excluding the date of actual payment, at a rate per annum equal to the sum of 2%
plus the Adjusted Base Rate for such day.
(b) So long as no Event of Default has occurred and is
continuing, each LIBOR Loan shall bear interest on the outstanding principal
amount thereof, for each Interest Period applicable thereto, at a rate per annum
equal to the applicable LIBOR Rate. So long as any Event of Default has occurred
and is continuing, each LIBOR Loan shall bear interest on the outstanding
principal amount thereof, for each Interest Period applicable thereto, at a rate
per annum equal to the sum of 2% plus the higher of (i) the Adjusted Base Rate
for such day and (ii) the applicable LIBOR Rate. Such interest shall be due and
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than three (3) months, at intervals of three (3) months after
the first day thereof, and at the maturity of the Revolving Credit Notes
(whether by reason of acceleration or otherwise). Any overdue principal of or
interest on any LIBOR Loan shall bear interest, due and payable on demand, for
each day from and including the date payment thereof was due to but excluding
the date of actual payment, at a rate per annum equal to the sum of 2% plus the
higher of (i) the Adjusted Base Rate for such day and (ii) the applicable LIBOR
Rate.
(c) So long as no Event of Default has occurred and is
continuing, each Revolving Credit Loan consisting of an Offshore Currency Loan
denominated in Euro shall bear interest on the outstanding principal amount
thereof, for each Interest Period applicable thereto, at a rate per annum equal
to the applicable EURIBOR Rate. So long as any Event of Default has occurred and
is continuing, each such Loan shall bear interest on the outstanding principal
amount thereof, for each Interest Period applicable thereto, at a rate per annum
equal to the sum of 2% plus the applicable EURIBOR Rate. Such interest shall be
due and payable for each Interest Period on the last day thereof and, if such
Interest Period is longer than three (3) months, at intervals of three (3)
months after the first day thereof, and at the maturity of the Revolving Credit
Notes (whether by reason of acceleration or otherwise). Any overdue principal of
or interest on any such Loan shall bear interest, due and payable on demand, for
each day from and including the date payment thereof was due to but excluding
the date of actual payment, at a rate per annum equal to the sum of 2% plus the
applicable EURIBOR Rate;
(d) So long as no Event of Default has occurred and is
continuing, each Revolving Credit Loan consisting of an Offshore Currency Loan
denominated in a currency other than Euro shall bear interest on the outstanding
principal amount thereof, for each Interest Period applicable thereto, at the
rate per annum quoted by Administrative Agent for such Interest Period, which
rate shall be based upon the rate at which deposits in the applicable Offshore
Currency for delivery on the first day of such Interest Period in same day funds
in the approximate amount of the Offshore Currency Loan being made or continued
and with a term equivalent to such Interest period would be offered by ▇▇▇▇▇
Fargo's Grand Cayman Branch (or such other office as may be designated by
Administrative Agent) to major banks in the relevant offshore interbank market
at their request approximately 11:00 a.m. local time two Business Days prior to
the first day of such Interest Period. So long as any Event of Default has
occurred and is continuing, each such Loan shall bear interest on the
outstanding principal amount thereof, for each Interest Period applicable
thereto, at a rate per annum equal to the sum of 2% plus the rate otherwise
applicable. Such interest shall be due and payable for each Interest Period on
the last day thereof and, if such Interest Period is longer than three (3)
months, at intervals of three
32
(3) months after the first day thereof, and at the maturity of the Revolving
Credit Notes (whether by reason of acceleration or otherwise). Any overdue
principal of or interest on any such Loan shall bear interest, due and payable
on demand, for each day from and including the date payment thereof was due to
but excluding the date of actual payment, at a rate per annum equal to the sum
of 2% plus the rate otherwise applicable.
(e) So long as no Event of Default has occurred and is
continuing, each Swing Line Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Swing Line Loan is
made until it becomes due, at a rate per annum equal to Adjusted Base Rate or
such lower rate as the Swing Line Lender and the Borrower may from time to time
mutually agree upon in writing. So long as any Event of Default has occurred and
is continuing, each Swing Line Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Swing Line Loan is
made until it becomes due, at a rate per annum equal to the sum of 2% plus the
Adjusted Base Rate for such day. Such interest shall be due and payable
quarterly in arrears on the last Business Day of each calendar quarter and at
the maturity of the Swing Line Note (whether by reason of acceleration or
otherwise). Any overdue principal of or interest on any Swing Line Loan shall
bear interest, due and payable on demand, for each day from and including the
date payment thereof was due to but excluding the date of actual payment, at a
rate per annum equal to the sum of 2% plus the Adjusted Base Rate for such day.
(f) Each Fronted Offshore Currency Loan shall bear interest as
set forth in the applicable Offshore Currency Addendum.
(g) The Administrative Agent shall determine each interest
rate applicable to the Loans hereunder. The Administrative Agent shall give
prompt notice to the Borrower, the Lenders and the Swing Line Lender by e-mail
or facsimile of each rate of interest so determined, and its determination
thereof shall be conclusive in the absence of manifest error.
Section 2.10 Loan Fees.
(a) Commitment Fee. From and including the Effective Date to
but excluding the Termination Date, the Borrower shall pay to the Administrative
Agent for the account of each Lender a nonrefundable commitment fee on the
unused portion of the Revolving Credit Commitment of such Lender (determined for
each Lender by subtracting such Lender's Revolving Credit Loans and such
Lender's Revolving Credit Commitment Percentage of the Letter of Credit
Outstandings from such Lender's Revolving Credit Commitment) at the Applicable
Commitment Fee Rate. Said commitment fee shall be (i) calculated on a daily
basis and (ii) due and payable quarterly in arrears on the last Business Day of
each calendar quarter during the Credit Availability Period and on the
Termination Date.
(b) Administrative Agent's Fees. The Borrower shall pay to the
Administrative Agent, for its own account, as and when due the agent and other
fees set forth in the Agent Fee Letter.
(c) Upfront Fees. The Borrower shall pay to the Administrative
Agent, for the account of the Lenders, as and when due the upfront fees set
forth in the Upfront Fee Letter.
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Section 2.11 Optional Termination or Reduction of, or Increase in, the
Revolving Credit Commitments.
(a) The Borrower may, upon at least five (5) Business Days' notice to
the Administrative Agent, terminate the Revolving Credit Commitments at any
time, if no Loans or Letter of Credit Obligations are outstanding at such time.
Any such termination shall be permanent and shall also automatically terminate
the Swing Line Commitment.
(b) The Borrower may, upon at least five (5) Business Days' notice to
the Administrative Agent, ratably reduce from time to time by an aggregate
amount of $5,000,000 or any larger multiple of $5,000,000, the aggregate amount
of the Revolving Credit Commitments in excess of the aggregate outstanding
principal amount of the Loans and Letter of Credit Obligations. Each such
reduction shall be permanent.
(c) So long as no Default or Event of Default shall have occurred and
be continuing, the Borrower shall have the right from time to time upon not less
than thirty (30) days' prior written notice to the Administrative Agent to
increase the Revolving Credit Commitments; provided that (i) no Lender shall
have any obligation to increase its Revolving Credit Commitment, (ii) such
requested increase shall be in a minimum principal amount of $15,000,000 and a
maximum principal amount of $50,000,000, (iii) in no event shall the Revolving
Credit Commitments be increased to an aggregate amount greater than
$150,000,000, (iv) each existing Lender shall have the right (but not the
obligation) to participate in such increase in an amount up to its Revolving
Credit Commitment Percentage of such increase, and (v) contemporaneously with
requesting each such increase, the Borrower certifies to the Administrative
Agent and each Lender in writing that immediately before and immediately after
giving effect to such increase, (A) the Borrower is in compliance with all of
the terms, provisions, covenants and conditions contained in this Agreement and
the other Loan Documents and (B) no Default or Event of Default has occurred and
is continuing; and provided further that:
(A) any increase in the Revolving Credit Commitments which is
accomplished by increasing the Revolving Credit Commitment of any Lender or
Lenders who are at the time of such increase party to this Agreement (which
Lender or Lenders shall consent to such increase in their sole and absolute
discretion) shall be accomplished as follows: (1) this Agreement will be amended
by the Borrower, the Administrative Agent and those Lender(s) whose Revolving
Credit Commitment(s) is or are being increased (but without any requirement that
the consent of the Swing Line Lender, the Letter of Credit Issuer or any other
Lenders be obtained) to reflect the revised Revolving Credit Commitments of each
of the Lenders, (2) the Administrative Agent will deliver an updated Schedule
1.01 to the Borrower, the Swing Line Lender, the Letter of Credit Issuer and
each of the Lenders reflecting the revised Revolving Credit Commitments and
Revolving Credit Commitment Percentages of each of the Lenders, (3) the
outstanding Revolving Credit Loans and Revolving Credit Commitment Percentages
of Letter of Credit Obligations will be reallocated on the effective date of
such increase among the Lenders in accordance with their revised Revolving
Credit Commitment Percentages (and the Lenders agree to make all payments and
adjustments necessary to effect the reallocation and the Borrower shall pay any
and all costs required pursuant to Section 2.13 in connection with such
reallocation as if such reallocation were a repayment) and (4) the Borrower will
deliver new Revolving Credit Note(s) to the Lender or Lenders whose Revolving
Credit Commitment(s) is or are being increased reflecting the revised Revolving
Credit Commitments of such Lender(s);
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(B) any increase in the Revolving Credit Commitments which is
accomplished by addition of a new Lender under this Agreement shall be
accomplished as follows: (1) such new Lender shall be subject to the consent of
the Administrative Agent and the Borrower, which consent shall not be
unreasonably withheld, (2) this Agreement will be amended by the Borrower, the
Administrative Agent and such new Lender (but without any requirement that the
consent of the Swing Line Lender, the Letter of Credit Issuer or any other
Lenders be obtained) to reflect the addition of such new Lender as a Lender
under this Agreement, (3) the Administrative Agent will deliver an updated
Schedule 1.01 to the Borrower, the Swing Line Lender, the Letter of Credit
Issuer and each of the Lenders reflecting the revised Revolving Credit
Commitments and Revolving Credit Commitment Percentages of each of the Lenders,
(4) the outstanding Revolving Credit Loans and Revolving Credit Commitment
Percentages of Letter of Credit Obligations will be reallocated on the effective
date of such increase among the Lenders in accordance with their revised
Revolving Credit Commitment Percentages (and the Lenders agree to make all
payments and adjustments necessary to effect the reallocation and the Borrower
shall pay any and all costs required pursuant to Section 2.13 in connection with
such reallocation as if such reallocation were a repayment) and (5) the Borrower
will deliver a Revolving Credit Note to such new Lender; and
(C) notwithstanding anything to the contrary contained in this
Agreement, upon any voluntary termination of the Revolving Credit Commitments
pursuant to Section 2.09(a) or any voluntary reduction of the Revolving Credit
Commitments pursuant to Section 2.09(b), the Borrower shall no longer have the
option to request an increase in the Revolving Credit Commitments pursuant to
this Section 2.09(c).
Section 2.12 Mandatory Termination of Commitments. The Revolving Credit
Commitments, the Swing Line Commitment and the Fronted Offshore Currency
Commitments shall terminate on the Termination Date, and any Loans then
outstanding (together with accrued interest thereon) and all accrued and unpaid
fees under this Agreement shall be due and payable on such date.
Section 2.13 Prepayments.
(a) The Borrower may at any time (i) upon notice to the
Administrative Agent by 12:00 noon (Central Standard Time) on the same Business
Day, prepay any Base Rate Borrowing in whole or in part by paying the principal
amount to be prepaid together with accrued interest thereon to the date of
prepayment and (ii) upon at least three (3) Business Days' notice to the
Administrative Agent, prepay, subject to Section 2.15, any LIBOR Borrowing or
any Revolving Credit Loan consisting of an Offshore Currency Loan in whole or in
part in amounts aggregating $2,000,000 or any larger multiple of $500,000 by
paying the principal amount to be prepaid together with accrued interest thereon
to the date of prepayment. Each such optional prepayment shall be applied to
prepay ratably the Revolving Credit Loans of the several Lenders included in
such Borrowing. Upon receipt of a notice of prepayment pursuant to this Section,
the Administrative Agent shall promptly notify each Lender of the contents
thereof and of such Lender's ratable share (if any) of such prepayment and such
notice shall not thereafter be revocable by the Borrower.
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(b) The Borrower may at any time prepay any Swing Line Loans
in whole or in part by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment.
Section 2.14 General Provisions as to Payments.
(a) The Borrower and each Borrowing Subsidiary shall make each
payment of principal of, and interest on, the Loans and of fees hereunder, not
later than 1:00 p.m. (Central Standard Time) on the date when due, in Federal or
other funds immediately available in Denver, Colorado, to the Administrative
Agent at its Payment Office and without setoff or counterclaim and free and
clear of and without deduction for any taxes, levies, impost, duties, charges,
fees, deductions, withholding, compulsory loans, restrictions or conditions of
any nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein unless the
Borrower or the Borrowing Subsidiary is required by law to make such deduction
or withholding. The Administrative Agent will distribute to each Lender, the
Offshore Currency Fronting Lender and the Swing Line Lender its ratable share
(if any) of each such payment received by the Administrative Agent for the
account of the Lenders, the Offshore Currency Fronting Lender and/or the Swing
Line Lender by 2:00 p.m. (Central Standard Time) on the day of receipt of such
payment by the Administrative Agent if such payment is received by the
Administrative Agent from the Borrower or the Borrowing Subsidiary by 1:00 p.m.
(Central Standard Time) on a Business Day or by 12:00 noon (Central Standard
Time) on the next succeeding Business Day if such payment is received by the
Administrative Agent from Borrower or the Borrowing Subsidiary after 1:00 p.m.
(Central Standard Time) on a Business Day or on a day which is not a Business
Day. Payments received by the Administrative Agent with respect to each Loan
will be distributed to each Lender based upon such Lender's pro rata interest in
such Loan. Any such payment owed by the Administrative Agent to any Lender, the
Offshore Currency Fronting Lender or the Swing Line Lender which is not paid
within the applicable time period shall bear interest (payable by the
Administrative Agent) until paid at the Federal Funds Effective Rate. Whenever
any payment of principal of, or interest on, the Base Rate Loans or the Swing
Line Loans or of fees shall be due on a day which is not a Business Day, the
date for payment thereof shall be extended to the next succeeding Business Day.
Whenever any payment of principal of, or interest on, the LIBOR Loans or the
Offshore Currency Loans shall be due on a day which is not a Business Day, the
date for payment thereof shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case the date
for payment thereof shall be the next preceding Business Day. If the date for
any payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice
from the Borrower or a Borrowing Subsidiary prior to the date on which any
payment is due to any of the Lenders, the Offshore Currency Fronting Lender
and/or the Swing Line Lender hereunder that the Borrower or the Borrowing
Subsidiary will not make such payment in full, the Administrative Agent may
assume that the Borrower or the Borrowing Subsidiary has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may,
in reliance upon such assumption, cause to be distributed to each Lender, the
Offshore Currency Fronting Lender and the Swing Line Lender on such due date an
amount equal to the amount then due such Lender, the Offshore Currency Fronting
Lender or the Swing Line Lender, as the case may be. If and to the extent that
the Borrower or the Borrowing Subsidiary shall not have
36
so made such payment, each Lender, the Offshore Currency Fronting Lender and/or
the Swing Line Lender, as the case may be, shall repay to the Administrative
Agent forthwith on demand such amount distributed to such Lender, the Offshore
Currency Fronting Lender or the Swing Line Lender, as the case may be, together
with interest thereon, for each day from the date such amount is distributed to
such Lender, the Offshore Currency Fronting Lender or the Swing Line Lender, as
the case may be, until the date such Lender, the Offshore Currency Fronting
Lender or the Swing Line Lender, as the case may be, repays such amount to the
Administrative Agent, at the Federal Funds Effective Rate.
(c) The specification of payment of Offshore Currency Loans in
the related Offshore Currency at a specific place pursuant to this Agreement is
of the essence. Such Offshore Currency shall, subject to Section 2.03, be the
currency of account and payment of such Loans under this Agreement and the
applicable Offshore Currency Addendum. The obligation of Borrower or the
applicable Borrowing Subsidiary in respect of such Loans shall not be discharged
by an amount paid in any other currency or at another place, whether pursuant to
a judgment or otherwise, to the extent the amount so paid, on prompt conversion
into the applicable Offshore Currency and transfer to such Lender under normal
banking procedure, does not yield the amount of such Offshore Currency due under
this Agreement or the applicable Offshore Currency Addendum. In the event that
any payment, whether pursuant to a judgment or otherwise, upon conversion and
transfer, does not result in payment of the amount of such Offshore Currency due
under this Agreement or the applicable Offshore Currency Addendum, such Lender
shall have an independent cause of action against each of the Borrower, the
Borrowing Subsidiaries and the Guarantor Subsidiaries for the currency deficit.
In the event that any payment, upon conversion and transfer, results in payment
in excess of the amount of such Offshore Currency due under this Agreement or
the Offshore Currency Addendum, such Lender shall refund such excess to the
Borrower or the applicable Borrowing Subsidiary.
Section 2.15 Funding Losses. If the Borrower or any Borrowing
Subsidiary makes any payment of principal with respect to any LIBOR Loan or any
Offshore Currency Loan, or any LIBOR Loan is converted to a different type of
Loan (pursuant to Article II, VI or VIII or otherwise) on any day other than the
last day of the Interest Period applicable thereto, or if the Borrower or any
Borrowing Subsidiary fails to borrow any LIBOR Loans or Offshore Currency Loan
after notice has been given to any Lender, or fails to borrow, prepay, convert
or continue any LIBOR Loan or any Offshore Currency Loan after notice has been
given to any Lender in accordance with Section 2.03, 2.04(a) or 2.11(a), or
Article VIII, the Borrower shall reimburse each Lender within fifteen (15) days
after demand for any resulting loss or expense incurred by it (or by an existing
or prospective Participant in the related Loan), including (without limitation)
any loss incurred in obtaining, liquidating or employing deposits from third
parties and any loss of margin for the period after any such payment, conversion
or failure to borrow; provided that such Lender shall have delivered to the
Borrower a certificate explaining in reasonable detail the amount of such loss
or expense, which certificate shall be conclusive in the absence of manifest
error.
Section 2.16 Computation of Interest and Fees. All interest and fees
hereunder (other than interest on Base Rate Loans) shall be computed on the
basis of a year of 360 days and paid for the actual number of days elapsed
(including the first day but excluding the last day). All interest on Base Rate
Loans hereunder shall be computed on the basis of a year of 365 days and paid
for the actual number of days elapsed (including the first day but excluding the
last day).
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Section 2.17 Withholding Tax Exemption.
(a) At least five (5) Business Days prior to the first date on
which interest or fees are payable hereunder for the account of any Lender, each
Lender that is not incorporated under the laws of the United States of America
or a state thereof agrees that it will deliver to each of the Borrower and the
Administrative Agent two duly completed copies of United States Internal Revenue
Service Form W-8BEN or W-8ECI (or successor forms), certifying in either case
that such Lender is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States federal income
taxes. Each Lender which so delivers a Form W-8BEN or W-8ECI (or successor
forms) further undertakes to deliver to each of the Borrower and the
Administrative Agent two additional copies of such forms (or successor forms) on
or before the date that such form expires or becomes obsolete or after the
occurrence of any event requiring a change in the most recent form so delivered
by it, and such amendments thereto or extensions or renewals thereof as may be
reasonably requested by the Borrower or the Administrative Agent, in each case
certifying that such Lender is entitled to receive payments under this Agreement
and the Notes without deduction or withholding of any United States federal
income taxes, unless an event (including without limitation any change in
treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and delivering any such
form with respect to it and such Lender advises the Borrower and the
Administrative Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax.
(b) If the U.S. Internal Revenue Service or any other
governmental authority of the United States or any other country or any
political subdivision thereof asserts a claim that the Administrative Agent did
not properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered or properly completed, because
such Lender failed to notify the Administrative Agent of a change in
circumstances which rendered its exemption from withholding ineffective or for
any other reason), such Lender shall indemnify the Administrative Agent fully
for all amounts paid, directly or indirectly, by the Administrative Agent as
tax, withholding thereof, or otherwise, including penalties and interest, and
including taxes imposed by any jurisdiction on amounts payable to the
Administrative Agent under this subsection, together with all costs and expenses
related thereto (including attorneys fees and time charges of attorneys for the
Administrative Agent, which attorneys may be employees of the Administrative
Agent). The obligations of the Lenders under this Section 2.17(b) shall survive
the payment of the Obligations and termination of this Agreement.
Section 2.18 Letters of Credit.
(a) Issuance of Letters of Credit. From and after the
Effective Date to but excluding the Termination Date, the Letter of Credit
Issuer agrees, upon the terms and conditions set forth in this Agreement, to
issue at the request and upon the application of the Borrower and for the
account of the Borrower or a Guarantor Subsidiary, one or more standby letters
of credit ("Letters of Credit") in Dollars or an Offshore Currency; provided,
however, that the Letter of Credit Issuer shall not be under any obligation to
issue, and shall not issue, any Letter of Credit if: (i) any order, judgment or
decree of any Governmental Authority with jurisdiction over the Letter of Credit
Issuer shall purport by its terms to enjoin or restrain such Letter of Credit
Issuer
38
from issuing such Letter of Credit, or any law or governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law) from any
Governmental Authority with jurisdiction over the Letter of Credit Issuer shall
prohibit, or request that the Letter of Credit Issuer refrain from, the issuance
of Letters of Credit in particular or shall impose upon the Letter of Credit
Issuer with respect to any Letter of Credit any restriction or reserve or
capital requirement (for which the Letter of Credit Issuer is not otherwise
compensated) or any unreimbursed loss, cost or expense which was not applicable,
in effect and known to the Letter of Credit Issuer as of the date of this
Agreement and which the Letter of Credit Issuer in good ▇▇▇▇▇ ▇▇▇▇▇ material to
it (the Letter of Credit Issuer shall promptly notify the Borrower of any event
which, in the judgment of the Letter of Credit Issuer, would preclude the
issuance of a Letter of Credit pursuant to this clause (i)); (ii) one or more of
the conditions to such issuance contained in Section 3.04 is not then satisfied;
(iii) after giving effect to such issuance, the aggregate outstanding amount of
the Letter of Credit Obligations would exceed the Letter of Credit Sublimit; or
(iv) with respect to a Letter of Credit requested to be denominated in an
Offshore Currency, the Letter of Credit Issuer is unable to issue Letters of
Credit in such Offshore Currency.
In no event shall:
(i) the aggregate amount of the Letter of Credit Obligations
at any time exceed the Letter of Credit Sublimit at such time;
(ii) the Total Outstandings at any time exceed the aggregate
amount of the Revolving Credit Commitments at such time;
(iii) the Dollar Equivalent of Letter of Credit Obligations
denominated in an Offshore Currency, when aggregated with the Dollar Equivalent
of Revolving Credit Loans denominated in an Offshore Currency and the Dollar
Equivalent of Fronted Offshore Currency Loans, exceed the Offshore Currency
Sublimit; or
(iv) the expiration date of any Letter of Credit, or the date
for payment of any draft presented thereunder and accepted by the Letter of
Credit Issuer, be later than the Letter of Credit Expiry Date, which in the case
of a Letter of Credit with an automatic "evergreen" provision providing for
renewal absent advance notice by the Borrower or the Letter of Credit Issuer,
will permit automatic renewals for successive periods of up to eighteen (18)
months provided the ultimate expiration date is not later than five (5) Business
Days prior to the Termination Date.
(b) Participating Interests. Immediately upon the issuance by
the Letter of Credit Issuer of a Letter of Credit in accordance with Section
2.18(d), each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Letter of Credit Issuer, without recourse,
representation or warranty, an undivided participation interest equal to its
Revolving Credit Commitment Percentage of the face amount of such Letter of
Credit and each draw paid by the Letter of Credit Issuer thereunder. Each
Lender's obligation to pay its proportionate share of all draws under the
Letters of Credit, absent gross negligence or willful misconduct by the Letter
of Credit Issuer in honoring any such draw, shall be absolute, unconditional and
irrevocable and in each case shall be made without counterclaim or set-off by
such Lender.
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(c) Letter of Credit Reimbursement Obligations.
(i) The Borrower agrees to pay to the Letter of
Credit Issuer (i) on each date that any amount is drawn under each Letter of
Credit a sum in Dollars or the Dollar Equivalent with respect to Letters of
Credit denominated in an Offshore Currency (and interest on such sum as provided
in clause (ii) below) equal to the amount so drawn plus all other charges and
expenses with respect thereto specified in Section 2.18(f) or in the applicable
Reimbursement Agreement and (ii) interest on any and all amounts remaining
unpaid under this Section 2.18(c) until payment in full at the Adjusted Base
Rate plus 2.00% per annum. The Borrower agrees to pay to the Letter of Credit
Issuer the amount of all Reimbursement Obligations owing in respect of any
Letter of Credit immediately when due, under all circumstances, including,
without limitation, any of the following circumstances: (A) any lack of validity
or enforceability of this Agreement or any agreement, document or instrument
executed pursuant hereto; (B) the existence of any claim, set-off, defense or
other right which the Borrower may have at any time against a beneficiary named
in a Letter of Credit, any transferee of any Letter of Credit (or any Person for
whom any such transferee may be acting), any Lender or any other Person, whether
in connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any underlying
transaction between the Borrower and the beneficiary named in any Letter of
Credit); (C) the validity, sufficiency or genuineness of any document which the
Letter of Credit Issuer has determined in good faith and in accordance with its
customary business practices complies on its face with the terms of the
applicable Letter of Credit, even if such document should later prove to have
been forged, fraudulent, invalid or insufficient in any respect or any statement
therein shall have been untrue or inaccurate in any respect; or (D) the
surrender or material impairment of any security for the performance or
observance of any of the terms hereof.
(ii) Notwithstanding any provisions to the contrary
in any Reimbursement Agreement, the Borrower agrees to reimburse the Letter of
Credit Issuer for amounts which the Letter of Credit Issuer pays under such
Letter of Credit no later than the time specified in this Agreement. If the
Borrower does not pay any such Reimbursement Obligations when due, the Borrower
shall be deemed to have immediately requested that the Lenders make a Revolving
Credit Loan which is Base Rate Loan under this Agreement in a principal amount
equal to such unreimbursed Reimbursement Obligations in Dollars or Dollar
Equivalent with respect to Letters of Credit denominated in an Offshore
Currency. The Administrative Agent shall promptly notify the Lenders of such
deemed request and, without the necessity of compliance with the requirements of
Sections 2.03 or 2.04, each Lender shall make available to the Administrative
Agent its Revolving Credit Loan in the manner prescribed for Revolving Credit
Loans. The proceeds of such Revolving Credit Loans shall be paid over by the
Administrative Agent to the Letter of Credit Issuer for the account of the
Borrower in satisfaction of such unreimbursed Reimbursement Obligations, which
shall thereupon be deemed satisfied by the proceeds of, and replaced by, such
Revolving Credit Loan.
(iii) If the Letter of Credit Issuer makes a payment
on account of any Letter of Credit and is not concurrently reimbursed therefore
by the Borrower and if for any reason a Revolving Credit Loan may not be made
pursuant to Section 2.18(c)(ii), then as promptly as practical during normal
banking hours on the date of its receipt of such notice or, if not practicable
on such date, not later than 2:00 p.m. (Central Standard Time) on the Business
40
Day immediately succeeding such date of notification, each Lender shall deliver
to the Administrative Agent for the account of the Letter of Credit Issuer, in
immediately available funds, the purchase price for such Lender's interest in
such unreimbursed Reimbursement Obligations in Dollars or Dollar Equivalent with
respect to Letters of Credit denominated in an Offshore Currency, which shall be
an amount equal to such Lender's Revolving Credit Commitment Percentage of such
payment. Each Lender shall, upon demand by the Letter of Credit Issuer, pay the
Letter of Credit Issuer interest on such Lender's pro-rata share of such draw
from the date of payment by the Letter of Credit Issuer on account of such
Letter of Credit until the date of delivery of such funds to the Letter of
Credit Issuer by such Lender at a rate per annum, computed for actual days
elapsed based on a 360-day year, equal to the Federal Funds Effective Rate for
day during such period; provided, that such payments shall be made by the
Lenders only in the event and to the extent that the Letter of Credit Issuer is
not reimbursed in full by the Borrower for interest on the amount of any draw on
the Letters of Credit.
(iv) At any time after the Letter of Credit Issuer
has made a payment on account of any Letter of Credit and has received from any
other Lender such Lender's pro-rata share of such payment, such Letter of Credit
Issuer shall, forthwith upon its receipt of any reimbursement (in whole or in
part) by the Borrower for such payment, or of any other amount from the Borrower
or any other Person in respect of such payment (including, without limitation,
any payment of interest or fees and any payment under any collateral account
agreement of the Borrower but excluding any transfer of funds from any other
Lender pursuant to Sections 2.18(c)(ii) or 2.18(c)(iii), transfer to such other
Lender such other Lender's ratable share of such reimbursement or other amount;
provided, that interest shall accrue for the benefit of such Lender from the
time such Letter of Credit Issuer has made a payment on account of any Letter of
Credit; provided, further, that in the event that the receipt by the Letter of
Credit Issuer of such reimbursement or other amount is found to have been a
transfer in fraud of creditors or a preferential payment under the United States
Bankruptcy Code or is otherwise required to be returned, such Lender shall
promptly return to the Letter of Credit Issuer any portion thereof previously
transferred by the Letter of Credit Issuer to such Lender, but without interest
to the extent that interest is not payable by the Letter of Credit Issuer in
connection therewith.
(d) Procedure for Issuance. Prior to the issuance of each
Letter of Credit, and as a condition of such issuance, the Borrower shall
deliver to the Letter of Credit Issuer (with a copy to the Administrative Agent)
a Reimbursement Agreement signed by the Borrower, together with such other
documents or items as may be required pursuant to the terms thereof, and the
proposed form and content of such Letter of Credit shall be reasonably
satisfactory to the Letter of Credit Issuer. Each Letter of Credit shall be
issued no earlier than one (1) Business Day after delivery of the foregoing
documents, which delivery may be by the Borrower to the Letter of Credit Issuer
by facsimile transmission, telex or other electronic means followed by delivery
of executed originals within five (5) days thereafter. The documents so
delivered shall be in compliance with the requirements set forth in Section
2.18(a), and shall specify therein (i) the stated amount of the Letter of Credit
requested, (ii) the effective date of issuance of such requested Letter of
Credit, which shall be a Business Day, (iii) the date on which such requested
Letter of Credit is to expire, (iv) the entity for whose benefit the requested
Letter of Credit is to be issued, which shall be either Borrower or a Subsidiary
and (v) the aggregate amount of Letter of Credit Obligations which are
outstanding and which will be outstanding after giving effect to the requested
Letter of Credit issuance. The delivery of the foregoing documents and
information shall constitute an "Issuance Request" for purposes of this
Agreement. Subject to
41
the terms and conditions of Section 2.18(a) and provided that the applicable
conditions set forth in Section 3.04 hereof have been satisfied, the Letter of
Credit Issuer shall, on the requested date, issue a Letter of Credit on behalf
of the Borrower in accordance with the Letter of Credit Issuer's usual and
customary business practices. In addition, any amendment of an existing Letter
of Credit shall be deemed to be an issuance of a new Letter of Credit and shall
be subject to the requirements set forth above. The Letter of Credit Issuer
shall give the Administrative Agent prompt written notice of the issuance of any
Letter of Credit.
(e) Nature of the Lenders' Obligations.
(i) Except as otherwise provided in the following
sentence, as between the Borrower and the Lenders, the Borrower assumes all
risks of the acts and omissions of, or misuse of the Letters of Credit by, the
respective beneficiaries of the Letters of Credit. In furtherance and not in
limitation of the foregoing, the Lenders shall not be responsible for (A) the
form, validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application for an
issuance of a Letter of Credit, even if it should in fact prove to be in any or
all respects invalid, insufficient, inaccurate, fraudulent or forged; (B) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (C) the failure of the beneficiary of a
Letter of Credit to comply fully with conditions required to be satisfied by any
Person other than the Letter of Credit Issuer in order to draw upon such Letter
of Credit (other than a failure to satisfy documentary conditions to drawing
where payment of the Letter of Credit despite such failure would constitute
gross negligence or willful misconduct of the Letter of Credit Issuer); (D)
errors, omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, facsimile transmission, telex or otherwise;
(E) the misapplication by the beneficiary of a Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (F) any consequences arising from
causes beyond control of the Letter of Credit Issuer.
(ii) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth (including in
Section 2.18(c)(i)), any action taken or omitted by the Letter of Credit Issuer
under or in connection with the Letters of Credit or any related certificates,
if taken or omitted in good faith, shall not put the Administrative Agent or any
Lender under any resulting liability to the Borrower or relieve the Borrower of
any of its obligations hereunder to the Letter of Credit Issuer or any such
Person.
(f) Letter of Credit Fees. The Borrower hereby agrees to pay
letter of credit fees with respect to each Letter of Credit from and including
the date of issuance thereof until the date such Letter of Credit is fully
drawn, canceled or expired, (i) for the account of the Letter of Credit Issuer,
an issuance fee equal to 1/8 of 1% of the initial face amount of such Letter of
Credit, payable on the date of issuance and on each anniversary date of the date
of issuance and (ii) for the ratable account of the Lenders, a per annum
percentage of the aggregate amount from time to time available to be drawn on
such Letter of Credit equal to (A) so long as no Event of Default has occurred
and is continuing, the Applicable LIBOR Margin from time to time in effect and
(B) so long as any Event of Default has occurred and is continuing, 2% over and
above the Applicable LIBOR Margin from time to time in effect, payable quarterly
in arrears on the last Business Day of each calendar quarter during the term of
such Letter of Credit and upon
42
the expiration, cancellation or utilization in full of such Letter of Credit. In
addition to the foregoing, the Borrower agrees to pay the Letter of Credit
Issuer any other administrative fees customarily charged by it in respect of
Letters of Credit issued by it to the extent such administrative fees are
previously disclosed to the Borrower by the Letter of Credit Issuer prior to the
issuance of a Letter of Credit.
(g) Conflict with Reimbursement Agreement. In the event of any
conflict between the terms of this Agreement and the terms of any Reimbursement
Agreement, the terms of this Agreement shall govern and control.
ARTICLE III
CONDITIONS
Section 3.01 Effectiveness. This Agreement shall become effective on
the date that each of the following conditions shall have been satisfied (or
waived in accordance with Section 9.05):
(a) receipt by the Administrative Agent of counterparts of
this Agreement signed in number sufficient for each party by each of the parties
hereto (or, in the case of any party as to which an executed counterpart shall
not have been received, receipt by the Administrative Agent in form satisfactory
to it of telegraphic, telex or other written confirmation from such party of
execution of a counterpart hereof by such party);
(b) receipt by the Administrative Agent for the account of
each Lender of a duly executed Revolving Credit Note dated on or before the
Effective Date complying with the provisions of Section 2.05;
(c) receipt by the Administrative Agent for the account of the
Swing Line Lender of the duly executed Swing Line Note dated on or before the
Effective Date complying with the provisions of Section 2.05;
(d) receipt by the Administrative Agent of the duly executed
Guaranty (which must be in form and substance satisfactory to the Administrative
Agent) dated on or before the Effective Date;
(e) receipt by the Administrative Agent of an opinion of ▇▇▇▇▇
▇▇▇▇ LLP, counsel for the Borrower and the Guarantor Subsidiaries, substantially
in the form of Exhibit E hereto (or such other form as is acceptable to the
Administrative Agent) and covering such additional matters relating to the
transactions contemplated hereby as the Administrative Agent may reasonably
request;
(f) receipt by the Administrative Agent of all fees payable on
or prior to the Effective Date;
(g) receipt by the Administrative Agent of all documents it
may reasonably request relating to the corporate, partnership or limited
liability company, as the case may be, existence of the Borrower and each
Guarantor Subsidiary and the corporate, partnership or
43
limited liability company, as the case may be, authority for and the validity of
this Agreement, the Notes and the Guaranty, all in form and substance
satisfactory to the Administrative Agent;
(h) receipt by the Administrative Agent of all documents it
may reasonably request relating to the granting of a perfected security interest
or lien for the ratable benefit of the Lenders with respect to 65% of Borrower's
direct or indirect ownership interest in each Foreign Subsidiary which
constitutes a Material Subsidiary;
(i) receipt by the Administrative Agent of all documents it
may reasonably request relating to the payoff and termination of Borrower's
existing credit facilities with Bank of America, N.A. and the other lenders
constituting members of such lending syndicate;
(j) receipt by the Administrative Agent of evidence
satisfactory to it that since September 30, 2003, there has been no change or
event that has caused a Material Adverse Effect; and
(k) receipt by the Administrative Agent of such other
documents and instruments consistent with the terms of this Agreement as the
Administrative Agent may reasonably request;
provided that this Agreement shall not become effective or be binding on any
party hereto unless all of the foregoing conditions are satisfied not later than
September 30, 2004. The Administrative Agent shall promptly notify the Borrower
and the Lenders of the Effective Date, and such notice shall be conclusive and
binding on all parties hereto.
Section 3.02 Revolving Credit Loan. The obligation of any Lender to
make a Revolving Credit Loan on the occasion of any Borrowing is subject to the
satisfaction of the following conditions:
(a) the fact that, immediately after giving effect to such
Revolving Credit Loan, the Total Outstandings will not exceed the aggregate
amount of the Revolving Credit Commitments;
(b) the fact that, immediately before and immediately after
giving effect to such Revolving Credit Loan, no Default or Event of Default
shall have occurred and be continuing;
(c) the fact that each of the representations and warranties
made by the Borrower and/or Subsidiary in this Agreement and/or in any other
Loan Document shall be true and correct in all material respects on and as of
the date of such Borrowing, except to the extent any such representation or
warranty is stated to relate solely to an earlier date, in which case such
representation or warranty shall have been true and correct in all material
respects on and as of such earlier date. For purposes of this Section 3.02(c),
the representations and warranties made by the Borrower in Section 4.04 of this
Agreement shall be deemed to refer to the most recent financial statements of
the Borrower delivered to the Administrative Agent and the Lenders pursuant to
Section 5.01(a) or 5.01(b) of this Agreement, as applicable; and
44
(d) the fact that since September 30, 2003, there has been no
change or event that has caused a Material Adverse Effect.
The acceptance of the proceeds of each Revolving Credit Loan hereunder
shall be deemed to be a representation and warranty by the Borrower on the date
of such Revolving Credit Loan as to the facts specified in clauses (a), (b), (c)
and (d) of this Section 3.02.
Section 3.03 Swing Line Loans. The obligation of the Swing Line Lender
to make a Swing Line Loan is subject to the satisfaction of the following
conditions:
(a) the fact that, immediately after giving effect to such
Swing Line Loan, (i) the Total Outstandings will not exceed the aggregate amount
of the Revolving Credit Commitments and (ii) the aggregate principal amount of
all outstanding Swing Line Loans will not exceed the amount of the Swing Line
Commitment;
(b) the fact that, immediately before and immediately after
giving effect to such Swing Line Loan, no Default or Event of Default shall have
occurred and be continuing;
(c) the fact that each of the representations and warranties
made by the Borrower and/or any Subsidiary in this Agreement and/or in any other
Loan Document shall be true in all material respects on and as of the date of
such Swing Line Loan, except to the extent any such representation or warranty
is stated to relate solely to an earlier date, in which case such representation
or warranty shall have been true and correct in all material respects on and as
of such earlier date. For purposes of this Section 3.03(c), the representations
and warranties made by the Borrower in Section 4.04 of this Agreement shall be
deemed to refer to the most recent financial statements of the Borrower
delivered to the Administrative Agent and the Lenders pursuant to Section
5.01(a) or 5.01(b) of this Agreement, as applicable; and
(d) the fact that since September 30, 2003, there has been no
change or event that has caused a Material Adverse Effect.
The acceptance of the proceeds of each Swing Line Loan hereunder shall
be deemed to be a representation and warranty by the Borrower on the date of
such Swing Line Loan as to the facts specified in clauses (a), (b), (c) and (d)
of this Section 3.03.
Section 3.04 Fronted Offshore Currency Loans. The obligation of the
Offshore Currency Fronting Lender to make a Fronted Offshore Currency Loan is
subject to the satisfaction of the following conditions:
(a) the receipt by the Administrative Agent of counterparts of
an Offshore Currency Addendum and a Borrowing Subsidiary Supplement signed by
each party thereto in sufficient numbers for each party
to this Agreement;
(b) the receipt by the Administrative Agent of a duly executed
continuing unlimited guaranty of payment of such Fronted Offshore Currency Loan
from the Borrower;
45
(c) receipt by the Administrative Agent for the account of the
Offshore Currency Fronting Lender of a duly executed Fronted Offshore Currency
Note in the maximum principal amount of such Fronted Offshore
Currency Loans;
(d) receipt by the Administrative Agent of all documents is
may reasonable request relating to the existence of the applicable Borrowing
Subsidiary and the authority for and the validity of the Loan Documents to which
such Borrowing Subsidiary is a party, all in form and substance satisfactory to
the Administrative Agent and the Offshore Currency Fronting Lender;
(e) the fact that, immediately after giving effect to such
Fronted Offshore Currency Loan, the Total Outstandings will not exceed the
aggregate amount of the Revolving Credit Commitments;
(f) the fact that, immediately before and immediately after
giving effect to such Fronted Offshore Currency Loan, no Default or Event of
Default shall have occurred and be continuing;
(g) the fact that each of the representations and warranties
made by the Borrower and/or any Subsidiary, including any Borrowing Subsidiary,
in this Agreement and/or in any other Loan Document shall be true in all
material respects on and as of the date of such Fronted Offshore Currency Loan,
except to the extent any such representation or warranty is stated to relate
solely to an earlier date, in which case such representation or warranty shall
have been true and correct in all material respects on and as of such earlier
date. For purposes of this Section 3.04(f), the representations and warranties
made by the Borrower in Section 4.04 of this Agreement shall be deemed to refer
to the most recent financial statements of the Borrower delivered to the
Administrative Agent and the Lenders pursuant to Section 5.01(a) or 5.01(b) of
this Agreement, as applicable; and
(h) the fact that since September 30, 2003, there has been no
change or event that has caused a Material Adverse Effect.
The acceptance of the proceeds of each Fronted Offshore Currency Loan
hereunder shall be deemed to be a representation and warranty by the Borrower
and each Borrowing Subsidiary on the date of such Fronted Offshore Currency Loan
as to the facts specified in clauses (a) through (g) of this Section 3.04.
Section 3.05 Letters of Credit. The obligation of the Letter of Credit
Issuer to issue, amend or extend a Letter of Credit is subject to the
satisfaction of the following conditions:
(a) the fact that, immediately after giving effect to such
Letter of Credit, (i) the Total Outstandings will not exceed the aggregate
amount of the Revolving Credit Commitments and (ii) the Letter of Credit
Outstandings will not exceed the amount of the Letter of Credit Sublimit;
(b) the fact that, immediately before and immediately after
giving effect to such Letter of Credit, no Default or Event of Default shall
have occurred and be continuing;
46
(c) the fact that each of the representations and warranties
made by the Borrower and/or any Subsidiary in this Agreement and/or in any other
Loan Document shall be true and correct in all material respects on and as of
the date of the issuance of such Letter of Credit, except to the extent any such
representation or warranty is stated to relate solely to an earlier date, in
which case such representation or warranty shall have been true and correct in
all material respects on and as of such earlier date. For purposes of this
Section 3.04(c), the representations and warranties made by the Borrower in
Section 4.04 of this Agreement shall be deemed to refer to the most recent
financial statements of the Borrower delivered to the Administrative Agent and
the Lenders pursuant to Section 5.01(a) or 5.01(b) of this Agreement, as
applicable; and
(d) the fact that since September 30, 2003, there has been no
change or event that has caused a Material Adverse Effect.
The issuance of an Issuance Request by the Borrower shall be deemed to
be a representation and warranty by the Borrower on the date of the issuance of
the applicable Letter of Credit as to the facts specified in clauses (a), (b),
(c) and (d) of this Section 3.05.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
Section 4.01 Corporate Existence and Power. The Borrower, each
Borrowing Subsidiary and each Guarantor Subsidiary (i) is a corporation duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization, (ii) has all corporate powers
required to carry on its business as now conducted and (iii) has all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted, except where the failure to have such
governmental licenses, authorizations, consents or approvals could not
reasonably be expected to have a Material Adverse Effect.
Section 4.02 Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower, each
Borrowing Subsidiary and each Guarantor Subsidiary of the Loan Documents to
which it is a party are within such Person's corporate powers, have been duly
authorized by all necessary corporate action, require no action by or in respect
of, or filing with, any governmental body, agency or official, and do not
contravene, or constitute a default under, any provision of applicable law or
regulation or of the articles of incorporation or by-laws of such Person or of
any judgment, injunction, order or decree, or of any agreement or other
instrument binding upon such Person or result in the creation or imposition of
any Lien on any asset of such Person.
Section 4.03 Binding Effect. This Agreement constitutes a valid and
binding agreement of the Borrower, and the other Loan Documents, when executed
and delivered in accordance with this Agreement, will constitute valid and
binding obligations of the Borrower and such of its Subsidiaries as are party
thereto, enforceable against such Persons in accordance with their respective
terms.
Section 4.04 Financial Information.
47
(a) The audited consolidated balance sheets of the Borrower
and its Subsidiaries as of September 30, 2003, and the related consolidated
statements of income, shareholders' equity and cash flows for the Fiscal Year
then ended, copies of which have been delivered to the Administrative Agent and
each of the Lenders, fairly present in all material respects, in conformity with
GAAP and in a manner consistent with prior periods, the consolidated financial
position of the Borrower and its Subsidiaries as of such date and their
consolidated results of operations and cash flows for such Fiscal Year.
(b) The unaudited consolidated balance sheets of the Borrower
and its Subsidiaries as of June 30, 2004 and the related consolidated statements
of income, shareholders' equity and cash flows for the Fiscal Quarter then
ended, copies of which have been delivered to the Administrative Agent and each
of the Lenders, fairly present in all material respects, in conformity with GAAP
and in a manner consistent with prior periods, the consolidated financial
position of the Borrower and its Subsidiaries as of such date and their
consolidated results of operations and cash flows for such Fiscal Quarter.
(c) Since September 30, 2003, there has been no material
adverse change in the properties, assets, liabilities, business, prospects,
operations, income or condition (financial or otherwise) of the Borrower and its
Subsidiaries taken as a whole.
Section 4.05 Litigation. Except as described on Schedule 4.05 attached
hereto, there is no action, suit or proceeding pending against, or to the
knowledge of any officer of the Borrower threatened against or affecting, the
Borrower or any of its Subsidiaries before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable possibility
of an adverse decision which could have a Material Adverse Effect or which in
any manner draws into question the validity of this Agreement or any of the
other Loan Documents.
Section 4.06 Compliance with ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. Except as described on Schedule
4.06 attached hereto, no member of the ERISA Group has (a) sought a waiver of
the minimum funding standard under Section 412 of the Internal Revenue Code in
respect of any Plan, (b) failed to make any contribution or payment to any Plan
or Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security under
ERISA or the Internal Revenue Code or (c) incurred any liability under Title IV
of ERISA other than a liability to the PBGC for premiums under Section 4007 of
ERISA.
Section 4.07 Environmental Matters. In the ordinary course of its
business, the Borrower conducts a review at such times as it deems prudent of
the effect of Environmental Laws on the properties of the Borrower and its
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including, without limitation, any capital or operating
expenditures required for clean-up or closure of properties presently or
previously owned, any capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law or as
a condition of any license, permit or
48
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat and any actual or potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, the Borrower has reasonably concluded
that Environmental Laws are unlikely to have a Material Adverse Effect.
Section 4.08 Taxes. The Borrower and its Subsidiaries have filed all
United States Federal income tax returns and all other material income tax
returns which are required to be filed by them, taking into account any filing
extensions for any such returns, and have paid all taxes due pursuant to such
returns or pursuant to any assessment received by the Borrower or any of its
Subsidiaries except such taxes or assessments, if any, as are being contested in
good faith by appropriate proceedings being diligently conducted for which
adequate reserves have been established as required by GAAP. The charges,
accruals and reserves on the books of the Borrower and its Subsidiaries in
respect of taxes or other governmental charges are, in the opinion of the
Borrower, adequate. Neither the Borrower nor any Subsidiary is a party to any
tax sharing or tax allocation agreement.
Section 4.09 Subsidiaries. Schedule 4.09 attached hereto contains an
accurate list of all of the Borrower's Subsidiaries, setting forth their
respective jurisdictions of incorporation or organization and the percentage of
their capital stock or other ownership interests owned by the Borrower or other
Subsidiaries. Each of the Borrower's Subsidiaries is a corporation, partnership,
limited liability company or other entity duly incorporated or organized,
validly existing and in good standing under the laws of its jurisdiction of
incorporation or organization, and has all corporate, partnership, limited
liability company or other powers and all governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted,
except where the failure to have such governmental licenses, authorizations,
consents and approvals could not reasonably be expected to have a Material
Adverse Effect. The execution, delivery and performance by the Guarantor
Subsidiaries of the Guaranty are within each Guarantor Subsidiary's corporate,
partnership or limited liability company, as the case may be, powers, have been
duly authorized by all necessary corporate, partnership or limited liability
company, as the case may be, action, require no action by or in respect of, or
filing with, any governmental body, agency or official and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
any of the organizational documents of any Guarantor Subsidiary or of any
judgment, injunction, order or decree, or of any agreement or other instrument
binding upon any Guarantor Subsidiary or result in the creation or imposition of
any Lien on any asset of any Guarantor Subsidiary.
Section 4.10 Full Disclosure. All information heretofore furnished in
writing by the Borrower to the Administrative Agent or any Lender for purposes
of or in connection with this Agreement or any transaction contemplated hereby
is, and all such information hereafter furnished in writing by the Borrower to
the Administrative Agent or any Lender will be, true, correct and complete in
all material respects on the date as of which such information is stated or
certified. The Borrower has disclosed to the Administrative Agent and the
Lenders in writing any and all facts which have or could reasonably be expected
to have a Material Adverse Effect.
Section 4.11 Compliance With Laws. Neither the Borrower nor any
Subsidiary is in violation of any applicable law, rule, regulation or ordinance
of any Governmental Authority, a violation of which could reasonably be expected
to have a Material Adverse Effect. The
49
Borrower and its Subsidiaries have and are in full compliance with and in good
standing with respect to all governmental and/or regulatory permits, licenses,
certificates, consents and franchises necessary to continue to conduct their
respective businesses as previously conducted by them and to own or lease and
operate their respective properties and assets as now owned or leased by them,
the failure to have or noncompliance with which could reasonably be expected to
have a Material Adverse Effect. No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with, or
exemption by, any governmental, regulatory, administrative or public body or
authority, or any subdivision thereof, or any other Person is required to
authorize, or is required in connection with, the execution, delivery or
performance of, or the legality, validity, binding effect or enforceability of,
any of the Loan Documents.
Section 4.12 Title to Property. Except as disclosed on Schedule 5.11
attached hereto, the Borrower and its Subsidiaries are the sole owners of, or
have the legal right to use and occupy, all property and assets which they claim
to own or which is necessary for them to conduct their respective businesses,
and all of such property and assets are free and clear of all Liens other than
Liens permitted by Section 5.11. The Borrower and its Subsidiaries enjoy
peaceful and undisturbed possession in all material respects under all leases
under which they are operating as a lessee.
Section 4.13 Regulation U. The Borrower is not engaged principally, or
as one of its important activities, 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, as amended) and no
part of the proceeds of any Loan will be used, whether directly or indirectly,
and whether immediately, incidentally or ultimately (a) to purchase or carry
margin stock or to extend credit to others for the purpose of purchasing or
carrying margin stock, or to refund or repay indebtedness originally incurred
for such purpose or (b) for any purpose which entails a violation of, or which
is inconsistent with, the provisions of any of the Regulations of The Board of
Governors of the Federal Reserve System, including, without limitation,
Regulations U, T or X thereof, as amended. If requested by the Administrative
Agent, the Borrower shall furnish to the Administrative Agent a statement in
conformity with the requirements of Federal Reserve Form U-1 referred to in
Regulation U.
Section 4.14 Investment Company Act of 1940; Public Utility Holding
Company Act of 1935. The Borrower is not an "investment company" as that term is
defined in, and is not otherwise subject to regulation under, the Investment
Company Act of 1940, as amended. The Borrower is not a "holding company" as that
term is defined in, and is not otherwise subject to regulation under, the Public
Utility Holding Company Act of 1935, as amended.
Section 4.15 No Default. No Default or Event of Default under this
Agreement has occurred and is continuing. There is no existing default or event
of default under or with respect to any indenture, contract, agreement, lease or
other instrument to which the Borrower or any Subsidiary is a party or by which
any property or assets of the Borrower or any Subsidiary is bound or affected, a
default under which could reasonably be expected to have a Material Adverse
Effect.
Section 4.16 Licenses, Permits, etc. The Borrower and each Subsidiary
possesses all necessary patents, patent rights, trademarks, trademark rights,
trade names, trade name rights, copyrights, licenses and other intellectual
property rights to conduct its business without conflict
50
with any patent, patent right, trademark, trademark right, trade name,
copyright, license or other intellectual property rights of any other Person,
except where the failure to possess such intellectual property rights or any
such conflict with the intellectual property rights of any other Person could
not reasonably be expected to have a Material Adverse Effect. To the best
knowledge of the Borrower, (a) no product of the Borrower infringes in any
material respect any patent, patent right, trademark, trademark right, trade
name, trade name right, copyright, license and/or other intellectual property
right of any other Person and (b) there is no material violation by any Person
of any right of the Borrower or any Subsidiary with respect to any patent,
patent right, trademark, trademark right, trade name, trade name right,
copyright, license and/or other intellectual property right owned or used by the
Borrower or any Subsidiary.
Section 4.17 Existing Debt. Schedule 4.17 attached hereto contains a
true, correct and complete list of all of the Debt of the Borrower and its
Subsidiaries as of the Effective Date.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Revolving Credit Commitment,
Swing Line Commitment, Loan or Letter of Credit remains outstanding hereunder or
any Obligation or other amount payable under any of the Loan Documents remains
unpaid, unless the prior written consent of the Required Lenders is obtained:
Section 5.01 Information. The Borrower will deliver to the
Administrative Agent and each of the Lenders:
(a) as soon as available and in any event within ninety (90)
days after the end of each Fiscal Year, an audited consolidated balance sheet of
the Borrower and its Subsidiaries as of the end of such Fiscal Year and the
related consolidated statements of earnings, cash flows and shareholders' equity
for such Fiscal Year, setting forth in each case in comparative form the figures
for the previous Fiscal Year (or in lieu thereof the Form 10-K of the Borrower
filed with the Securities and Exchange Commission for such Fiscal Year), all
reported on by independent public accountants of nationally recognized standing
in a manner acceptable to the Securities and Exchange Commission;
(b) as soon as available and in any event within forty-five
(45) days after the end of each Fiscal Quarter (other than the last Fiscal
Quarter of each Fiscal Year), consolidated balance sheets of the Borrower and
its Subsidiaries as of the end of such Fiscal Quarter and the related
consolidated statements of earnings, cash flows and shareholders' equity for
such Fiscal Quarter and for the portion of the Fiscal Year ended at the end of
such Fiscal Quarter, setting forth in each case in comparative form the figures
for the corresponding Fiscal Quarter and the corresponding portion of the
previous Fiscal Year (or in lieu thereof the Form 10-Q of the Borrower filed
with the Securities and Exchange Commission for such Fiscal Quarter), all
certified (subject to normal year-end adjustments and without footnotes) as to
fairness of presentation, GAAP and consistency by a Financial Officer of the
Borrower;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate in the form
of Exhibit G attached hereto ("Compliance Certificate") executed by a Financial
Officer (i) setting forth in reasonable detail
51
the calculations required to establish whether the Borrower was in compliance
with the requirements of Sections 5.07, 5.08 and 5.09 on the date of such
financial statements, (ii) stating whether any Default or Event of Default
exists on the date of such certificate and, if any Default or Event of Default
then exists, setting forth the details thereof and the action which the Borrower
is taking or proposes to take with respect thereto and (iii) listing the
Subsidiaries of the Borrower and specifying whether such Subsidiaries are
Material Subsidiaries;
(d) as soon as available and in any event within ninety (90)
days after the beginning of each fiscal year of Borrower, consolidated balance
sheet, income statement and cash flow projections for Borrower and its
Subsidiaries for such fiscal year, all in form and detail reasonably acceptable
to the Administrative Agent;
(e) within three (3) Business Days after any officer of the
Borrower obtains knowledge of any Default or Event of Default, a certificate of
a Financial Officer setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto;
(f) within three (3) Business Days after the creation,
formation or acquisition thereof, written notice of the creation, formation or
acquisition of any Subsidiary and specifying whether such Subsidiary
is a Material Subsidiary;
(g) within three (3) Business Days after any officer of the
Borrower obtains knowledge thereof, written notice of any Subsidiary which was
not theretofore a Material Subsidiary becoming a Material
Subsidiary;
(h) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(i) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any registration
statements on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and
8-K (or their equivalents) which the Borrower shall have filed with the
Securities and Exchange Commission;
(j) if and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) with respect to any Plan which would constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of
such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code, a copy of such application; (v) gives
notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of
such notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or
52
makes any amendment to any Plan which has resulted or could result in the
imposition of a Lien or the posting of a bond or other security, a certificate
of the Financial Officer of the Borrower setting forth details as to such
occurrence and action, if any, which the Borrower or applicable member of the
ERISA Group is required or proposes to take;
(k) within three (3) Business Days after any officer of the
Borrower obtains knowledge thereof, written notice of the institution of any
litigation, arbitration proceeding or governmental or regulatory proceeding
against or affecting Borrower or any Subsidiary, whether or not considered to be
covered by insurance, in which the prayer or claim for relief seeks recovery of
an amount in excess of $5,000,000 (or, if no dollar amount is specified in the
prayer or claim for relief, in which there is a reasonable likelihood of
recovery of an amount in excess of $5,000,000) or any form of equitable relief
which, if granted, could reasonably be expected to have a Material Adverse
Effect; and
(l) from time to time such additional information regarding
the financial position or business of the Borrower and its Subsidiaries as the
Administrative Agent, at the request of any Lender, may reasonably request.
Section 5.02 Inspections. The Borrower will, and will cause each of its
Subsidiaries to, permit representatives of the Administrative Agent and each
Lender: (a) if no Default or Event of Default has occurred and is then
continuing, at the expense of the Administrative Agent or such Lender, as the
case may be, and upon reasonable prior notice to the Borrower, to visit the
principal executive office of the Borrower, to discuss the affairs, finances,
prospects and accounts of the Borrower and its Subsidiaries with the officers of
the Borrower and its Subsidiaries and (with the consent of the Borrower, which
consent shall not be unreasonably withheld and in the presence of one or more
officers of the Borrower) with the Borrower's independent certified public
accountants and (with the consent of the Borrower, which consent shall not be
unreasonably withheld) to visit the other offices and properties of the Borrower
and each Subsidiary, all at such reasonable times and as often as may be
reasonably requested in writing; and (b) if any Default or Event of Default has
occurred and is then continuing, at the expense of the Borrower, to visit and
inspect any of the offices or properties of the Borrower or any Subsidiary, to
examine all of their respective books of account, records, reports and other
papers, to make copies and extracts therefrom and to discuss their respective
affairs, finances, prospects and accounts with their respective officers and
independent certified public accountants (and by this provision the Borrower
authorizes said accountants to discuss the affairs, finances, prospects and
accounts of the Borrower and its Subsidiaries), all at such times and as often
as may be requested.
Section 5.03 Maintenance of Property; Insurance.
(a) The Borrower will cause all property used or useful in the
conduct of its business or the business of any Subsidiary to be maintained and
kept in good condition, repair and working order in all material respects and
supplied with all necessary equipment and will cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as in
the judgment of the Borrower may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section shall prevent the Borrower from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the reasonable
53
judgment of the Borrower, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any material respect to
the Lenders.
(b) The Borrower will, and will cause each of its Subsidiaries
to, maintain (either in the name of the Borrower or in such Subsidiary's own
name) insurance with financially sound and reputable insurers with respect to
its respective properties and businesses against such casualties and
contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of entities of
established reputations engaged in the same or similar business and similarly
situated.
Section 5.04 Conduct of Business and Maintenance of Existence. The
Borrower will, and will cause each Subsidiary to, substantially continue to
engage in the same lines of business as the Borrower and its Subsidiaries are
engaged in on the date of this Agreement or businesses ancillary thereto, and
will preserve, renew and keep in full force and effect, and will cause each
Subsidiary to preserve, renew and keep in full force and effect their respective
corporate, partnership, limited liability company or other entity existence and
their respective rights, privileges and franchises necessary or desirable in the
normal conduct of business, provided, however, that the Borrower shall not be
required to preserve any such right or franchise if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Borrower and that the loss thereof is not disadvantageous in
any material respect to the Lenders.
Section 5.05 Compliance with Laws. The Borrower will comply, and cause
each Subsidiary to comply, with all applicable laws, ordinances, rules,
regulations, and requirements of Governmental Authorities (including, without
limitation, Environmental Laws and ERISA and the rules and regulations
thereunder) except where the necessity of compliance therewith is contested in
good faith by appropriate proceedings being diligently conducted and except
where the failure to comply will not have a Material Adverse Effect.
Section 5.06 Payment of Taxes. The Borrower will, and it will cause
each Subsidiary to, duly file all federal, state, local, foreign and other
income tax returns and all other tax returns and reports of the Borrower or such
Subsidiary, as the case may be, which are required to be filed and duly pay and
discharge promptly all taxes, assessments and other governmental charges imposed
upon it or any of its assets or revenues; provided, however, that neither the
Borrower nor any Subsidiary shall be required to pay any such tax, assessment or
other governmental charge if (a) the amount, applicability or validity thereof
is being diligently contested by the Borrower or such Subsidiary on a timely
basis in good faith and in appropriate proceedings and the Borrower or such
Subsidiary has established adequate reserves therefor in accordance with GAAP on
the books of the Borrower or such Subsidiary or (b) the nonpayment of such taxes
and assessments was not wilful and the nonpayment of all such taxes and
assessments in the aggregate could not reasonably be expected to have a Material
Adverse Effect.
Section 5.07 Maximum Consolidated Leverage Ratio. The Borrower will
have a Consolidated Leverage Ratio of not more than 3.0 to 1.0 as of the last
day of each Fiscal Quarter commencing with the Fiscal Quarter ending September
30, 2004.
54
Section 5.08 Minimum EBITDA. The Borrower will, as of the last day of
each Fiscal Quarter commencing with the Fiscal Quarter ending September 30,
2004, have a Consolidated EBITDA for the four (4) consecutive fiscal quarter
period of Borrower then ended of at least the sum of (a) $30,000,000 plus (b)
the lesser of (i) Fifty Percent (50%) of Acquired Cash Flow or (ii) $10,000,000.
Section 5.09 Minimum Consolidated Net Worth. The Borrower will, as of
the last day of each Fiscal Quarter commencing with the Fiscal Quarter ending
September 30, 2004, have a Consolidated Net Worth of not less than the sum of
(a) $232,870,000 plus (B) Fifty Percent (50%) of Consolidated Net Income (with
no deductions for losses) during each Fiscal Quarter of the Company ending on or
after April 1, 2004 (such required increases to be cumulative for each such
fiscal quarter) plus (C) Eighty Percent (80%) of the net proceeds received by
the Borrower from the issuance of any capital stock or other equity interests of
the Borrower on or after April 1, 2004, other than the net proceeds realized by
the Borrower from the exercise of employee options to acquire capital stock of
Borrower.
Section 5.10 Limitation on Debt. The Borrower will not, nor will it
permit any of its Subsidiaries to, incur or at any time be liable upon or with
respect to any Debt (whether as principal or as guarantor or other surety or
otherwise) except:
(a) Debt outstanding on the Effective Date and listed on
Schedule 4.17 attached hereto;
(b) Debt of the Borrower owed to a Wholly-Owned Subsidiary
which is a Guarantor Subsidiary and Debt of a Wholly-Owned Subsidiary which is a
Guarantor Subsidiary owed to the Borrower or another Wholly-Owned Subsidiary
which is a Guarantor Subsidiary;
(c) Debt incurred by the Borrower after the Effective Date
(other than Debt permitted by clause (b) above), provided that (i) after giving
effect to the incurrence of such Debt (assuming such Debt was incurred on the
last day of the most recently completed Fiscal Quarter), the Borrower would have
been in compliance with Section 5.07 as of the last day of such Fiscal Quarter
and (ii) both immediately before and immediately after giving effect to the
incurrence of such Debt, no Default or Event of Default shall have occurred and
be continuing;
(d) obligations (contingent or otherwise) of Borrower or any
Subsidiary existing or arising under any Swap Contract, provided that (i) such
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with
liabilities, commitments, investments, assets or property held or reasonably
anticipated by such Person, or changes in the value of securities issued by such
Person, and not for purposes of speculation or taking a "market view" and (ii)
such Swap Contract does not contain any provision exonerating the non-defaulting
party from its obligation to make payments on outstanding transactions to the
defaulting party; and
(e) Debt incurred by a Subsidiary after the Effective Date
(other than debt permitted by clause (b) above), provided that (i) after giving
effect to the incurrence of such Debt, the aggregate amount of outstanding Debt
secured by Liens incurred pursuant to Section 5.11(f) plus the aggregate amount
of outstanding Debt of Subsidiaries, other than Fronted Offshore Currency Loans,
does not exceed 10% of Consolidated Total Capitalization as of the
55
Borrower's most recently completed Fiscal Quarter, (ii) after giving effect to
the incurrence of such Debt (assuming such Debt was incurred on the last day of
the most recently completed Fiscal Quarter), the Borrower would have been in
compliance with Section 5.07 as of the last day of such Fiscal Quarter and (iii)
both immediately before and immediately after giving effect to the incurrence of
such Debt, no Default or Event of Default shall have occurred and be continuing.
Section 5.11 Negative Pledge. The Borrower will not, and will not
permit any Subsidiary to, create or incur, or suffer to be incurred or to exist
(upon the happening of a contingency or otherwise), any Lien on or with respect
to any property or asset (including, without limitation, any document or
instrument in respect of goods or accounts receivable) of the Borrower or any
Subsidiary, whether now owned or held or hereafter acquired, or upon any income
or profits therefrom, or assign or otherwise convey any right to receive income
or profits, except:
(a) Liens securing the Obligations in favor of the
Administrative Agent for the ratable benefit of the Lenders:
(b) Liens for property taxes and assessments or governmental
charges or levies, either not yet due and payable or to the extent that
nonpayment thereof shall be permitted in accordance with Section 5.06
of this Agreement;
(c) without duplication, Liens, pledges or deposits for
worker's compensation, unemployment insurance, old age benefits or social
security obligations, statutory obligations or other similar charges, good faith
deposits made in connection with tenders, contracts or leases to which the
Borrower or any Subsidiary is a party or other deposits required to be made in
the ordinary course of business provided in each case the obligation secured is
not for borrowed money, customer advances, trade payables or obligations to
agricultural producers and is not overdue or, if overdue, is being diligently
contested in good faith by appropriate proceedings and adequate reserves have
been provided therefor on the books of the Borrower or the applicable Subsidiary
in accordance with GAAP;
(d) any attachment or judgment Lien, unless the judgment it
secures shall not, within ninety (90) days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall not have been
discharged within ninety (90) days after the expiration of such stay;
(e) Liens incidental to the ownership of its property which
are not incurred in connection with the incurrence of Debt or the borrowing of
money and which do not in the aggregate materially impair the use of such
property in the operation of the business of the Borrower and its Subsidiaries
taken as a whole or the value and utility of such property generally;
(f) Liens existing as of the Effective Date and listed on
Schedule 5.11 attached hereto; and
(g) Liens incurred after the Effective Date not permitted by
the preceding clauses (a) through (e) above to secure Debt, provided that (i)
after giving effect to the
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incurrence of such Lien and the Debt secured thereby (A) the aggregate amount of
outstanding Debt secured by Liens incurred pursuant to this Section 5.11(f) plus
the aggregate amount of outstanding Debt of Subsidiaries permitted by Section
5.10(e) does not exceed 15% of Consolidated Total Capitalization as of the
Borrower's most recently completed Fiscal Quarter and (B) the Debt secured by
such Lien is permitted to be incurred in accordance with Sections 5.07 and 5.10
and (ii) both immediately before and immediately after giving effect to the
incurrence of such Lien and the Debt secured thereby, no Default or Event of
Default shall have occurred and be continuing.
Section 5.12 Consolidations, Mergers and Sales of Assets.
(a) Neither the Borrower nor any Subsidiary will consolidate
or merge with or into any other Person unless (i) the Borrower is the
corporation surviving such merger or, in the case of any Subsidiary
consolidating or merging with a Person other than the Borrower, the surviving
entity is a Wholly-Owned Subsidiary which is a Guarantor Subsidiary and (ii)
both immediately before and immediately after giving effect to such merger, no
Default or Event of Default shall have occurred and be continuing.
(b) Other than (i) sales of inventory and worn or obsolete
equipment in the ordinary course of business and (ii) sales, leases and
transfers to the Borrower or a Wholly-Owned Subsidiary which is a Guarantor
Subsidiary, the Borrower will not, and will not permit any Subsidiary to, sell,
lease (as lessor) or otherwise transfer or dispose of, directly or indirectly,
any property, unless (A) the aggregate book value of such property as shown by
the accounting books and records of the Borrower, together with the aggregate
book value of all other property as shown by the accounting books and records of
the Borrower sold, leased or otherwise transferred pursuant to this subsection
(b) after the Effective Date, does not exceed 20% of Consolidated Net Worth
determined as of the most recently-ended Fiscal Quarter and (B) both immediately
before and immediately after giving effect to such sale, lease, transfer or
other disposition, no Default or Event of Default shall have occurred and be
continuing.
(c) The Borrower will not, and will not permit any Subsidiary
to, sell, transfer or otherwise dispose of the capital stock, partnership
interests, membership interests or other equity interests of any Subsidiary,
unless (A) the aggregate book value of such capital stock, partnership
interests, membership interests or other equity interests as shown by the
accounting books and records of the Borrower, together with the aggregate book
value of all other such interests as shown by the accounting books and records
of the Borrower sold, transferred or otherwise disposed of pursuant to this
subsection (c) after the Effective Date, does not exceed 20% of Consolidated Net
Worth determined as of the most recently-ended Fiscal quarter and (B) both
immediately before and immediately after giving effect to such sale, transfer or
other disposition, no Default or Event of Default shall have occurred and be
continuing. Upon the permitted sale of any Guarantor Subsidiary pursuant to
clauses (A) and (B) of this subsection (c), such Subsidiary, without further act
on the part of the Administrative Agent or the Lenders, shall be deemed to be
released from its obligations under the Guaranty.
Section 5.13 Transactions with Affiliates. The Borrower will not, and
will not permit any Subsidiary to, directly or indirectly, enter into any
material transaction with any Affiliate (other than a transaction between the
Borrower and any Wholly-Owned Subsidiary or a transaction between Wholly-Owned
Subsidiaries) which transaction is not on terms and
57
conditions at least as favorable to the Borrower or such Subsidiary as the terms
and conditions which would apply in a similar transaction with a Person not an
Affiliate (an "Arm's-Length Transaction"). Any material transaction with any
Affiliate shall be deemed to be an Arm's-Length Transaction if approved by (a) a
majority of the Borrower's directors who are unaffiliated with such Affiliate or
(b) a majority of the members of any committee of the Board of Directors of the
Borrower who are unaffiliated with such Affiliate.
Section 5.14 Acquisitions. The Borrower will not, and it will not cause
or permit any Subsidiary to, consummate any Acquisitions other than Permitted
Acquisitions.
Section 5.15 Limitation on Certain Covenants and Restrictions. The
Borrower will not, and it will not cause or permit any Subsidiary to, enter
into, or permit to exist, any agreement with any Person which prohibits or
limits the ability of the Borrower or such Subsidiary, as the case may be, to
(a) pay dividends or make other distributions or prepay any Debt or other
obligations owed to the Borrower and/or any Subsidiary, (b) make loans or
advances to the Borrower and/or any Subsidiary, (c) transfer any of its assets
to the Borrower and/or any Subsidiary or (d) create, incur, assume or suffer to
exist any Lien upon any of its assets or revenues, whether now owned or
hereafter acquired; provided that the foregoing shall not apply to restrictions
contained in agreements governing Debt incurred after the date of this Agreement
by the Guarantor or any Subsidiary in compliance with this Agreement so long as
such restrictions are no more restrictive than those contained in this
Agreement.
Section 5.16 Pari Passu Position; Covenant to Secure the Obligations
Equally. The Borrower will cause all of the Obligations to at all times rank on
a pari passu basis with all of the Borrower's other unsecured Debt. The Borrower
will, if it or any Subsidiary shall create or assume any Lien upon any of its
assets, whether now owned or hereinafter acquired, other than Liens permitted by
Section 5.11 (unless prior written consent to the creation or assumption thereof
shall have been obtained pursuant to Section 9.05 of this Agreement), make or
cause to be made effective provision whereby all of the Obligations will be
secured by such Lien equally and ratably with any and all other Debt and other
obligations thereby secured so long as any such other Debt or other obligations
shall be so secured as evidenced by documentation which is reasonably acceptable
to the Administrative Agent. The Borrower acknowledges and agrees that
compliance with this covenant will not cure a violation of Section 5.11 of this
Agreement or any other covenant contained in this Agreement.
Section 5.17 New Material Subsidiaries. The Borrower will, within ten
(10) Business Days after (a) the creation, formation or acquisition of any
Domestic Subsidiary which is a Material Subsidiary or (b) any Domestic
Subsidiary which was not theretofore a Material Subsidiary becoming a Material
Subsidiary, cause such Material Subsidiary to guaranty the payment and
performance of all of the Obligations pursuant to a Guarantee in substantially
the form of the Guaranty. The Borrower will, within ten (10) Business Days after
(a) the creation, formation or acquisition of any Foreign Subsidiary which is a
Material Subsidiary or (b) any Foreign Subsidiary which was not theretofore a
Material Subsidiary becoming a Material Subsidiary, execute, or cause to be
executed, and deliver to Administrative Agent such documents as the
Administrative Agent shall request in order to effect the granting and
perfection of a security interest or lien as collateral for the Obligations in
65% of Borrower's direct or indirect ownership interest in such Foreign
Subsidiary in favor of the Administrative Agent for the ratable benefit of the
Lenders. Contemporaneously with the execution of such Guarantee or such
documents, the
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Borrower shall execute and/or obtain and deliver to the Administrative Agent
such other documentation, including, without limitation, certified corporate,
partnership or limited liability company, as the case may be, documents,
resolutions and legal opinions, as the Administrative Agent may reasonably
require in connection therewith, all of which must be in form and substance
reasonably satisfactory to the Administrative Agent.
Section 5.18 Use of Proceeds. The proceeds of the Loans shall be used
solely to refinance certain existing indebtedness of the Borrower or a Borrowing
Subsidiary, to finance Permitted Acquisitions, to effect permitted repurchases
of outstanding stock of the Borrower, to pay permitted dividends on Borrower's
stock and for general corporate and working capital purposes. No part of the
proceeds of any Loan will be used in violation of any applicable law, rule or
regulation. With the exception of permitted repurchases by the Borrower of its
outstanding stock, the Borrower and any Borrowing Subsidiary will not directly
or indirectly use any of the proceeds of any Loan for the purpose of buying or
carrying margin stock within the meaning of Regulation U of The Board of
Governors of the Federal Reserve System, as amended. As used in this Section,
the terms "margin stock" and "purpose of buying or carrying" shall have the
respective meanings ascribed to them in Regulation U of The Board of Governors
of the Federal Reserve System, as amended.
ARTICLE VI
DEFAULTS
Section 6.01 Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of
any Loan or Letter of Credit Obligation, or shall fail to pay within three (3)
Business Days of the due date thereof any interest on any Loan, any fees or any
other Obligation or other amount payable under this Agreement or any other Loan
Document; or
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.02, 5.07, 5.08, 5.09, 5.10, 5.11, 5.12, 5.14, 5.15 or
5.16; or
(c) the Borrower shall fail to observe or perform any covenant
or agreement contained in this Agreement or any other Loan Document (other than
those covered by clause (a) or (b) above) for thirty (30) days after the earlier
of (i) a Financial Officer has actual knowledge thereof or (ii) written notice
thereof has been given to the Borrower by the Administrative Agent at the
request of any Lender; or
(d) any representation, warranty, certification or statement
made by the Borrower or any Subsidiary in this Agreement or in any other Loan
Document or in any certificate, financial statement or other written document
delivered pursuant to this Agreement or any other Loan Document shall prove to
have been untrue or incorrect in any material respect when made (or deemed
made); or
(e) (i) the Borrower or any Subsidiary shall default (as
principal or as guarantor or other surety) in the payment of any principal of or
premium or make-whole amount or interest on any Material Debt beyond any period
of grace provided with respect thereto, (ii)
59
the Borrower or any Subsidiary shall be in default in the performance of or
compliance with any term or provision of any evidence of any Material Debt or of
any indenture, mortgage or other agreement, document or instrument relating
thereto or any other condition exists, and as a consequence of such default or
condition such Material Debt has become, or has been declared (or one or more
Persons are entitled to declare such Material Debt to be), due and payable
before its stated maturity or before its regularly scheduled dates of payment or
(iii) as a consequence or continuation of any event or condition (other than the
passage of time or the right of the holder of Material Debt to convert such
Material Debt into equity interests), (x) the Borrower or any Subsidiary has
become obligated to purchase or repay any portion of any Material Debt before
its regular maturity or before its regularly scheduled dates of payment or (y)
one or more Persons have the right to require the Borrower or any Subsidiary to
so purchase or repay such Material Debt; or
(f) there occurs under any Swap Contract an "Early Termination
Date" (as defined in such Swap Contract) resulting from (a) any event of default
under such Swap Contract as to which the Borrower or any Subsidiary is the
"Defaulting Party" (as defined in such Swap Contract) or (B) any "Termination
Event" (as defined in such Swap Contract) under such Swap Contract as to which
Borrower or any Subsidiary is an "Affected Party" (as defined in such Swap
Contract) and, in either event, the Swap Termination Value owed by Borrower or
such Subsidiary as a result thereof is greater than $10,000,000.00; or
(g) the Borrower or any Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall take any corporate action to authorize any of
the foregoing; or
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Subsidiary seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of sixty (60) days; or an
order for relief shall be entered against the Borrower or any Material
Subsidiary under the federal bankruptcy laws as now or hereafter in effect; or
(i) any member of the ERISA Group shall fail to pay when due
an amount or amounts aggregating in excess of $10,000,000 which it shall have
become liable to pay under Title IV of ERISA; or notice of intent to terminate a
Material Plan shall be filed under Title IV of ERISA by any member of the ERISA
Group, any plan administrator or any combination of the foregoing; or the PBGC
shall institute proceedings under Title IV of ERISA to terminate, to impose
liability (other than for premiums under Section 4007 of ERISA) in respect of,
or to cause a trustee to be appointed to administer any Material Plan; 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 there shall
occur a complete or partial withdrawal from, or a default,
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within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more
Multiemployer Plans which could cause one or more members of the ERISA Group to
incur a current payment obligation in excess of $10,000,000; or
(j) a judgment or order (i) for the payment of money in excess
of $10,000,000 or (ii) that would otherwise result in a Material Adverse Effect
shall be rendered against the Borrower or any Subsidiary and such judgment or
order shall continue unsatisfied and unstayed for a period of sixty (60) days;
or
(k) any person or group of persons (within the meaning of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated by
the Securities and Exchange Commission under said Act) of 30% or more in voting
power of the outstanding Voting Stock of the Borrower; or, during any period of
24 consecutive calendar months, a majority of the board of directors of the
Borrower does not consist of individuals who were (i) directors of the Borrower
on the first day of such period, (ii) directors who were selected or whose
nomination for election was approved by a vote of at least a majority of the
directors then still in office referred to in clause (i) above, or (iii)
directors who were selected or whose nomination for election was approved by a
vote of at least a majority of the board consisting of directors still in office
described in clauses (i) and (ii) above or this clause (iii); or
(l) the Borrower shall repudiate, or shall challenge the
validity or enforceability of its obligations under the Loan Documents or for
any reason any of the Loan Documents shall cease to be in full force and effect;
or
(m) the Guaranty shall at any time for any reason cease to be
in full force and effect or shall be declared to be null and void by a court of
competent jurisdiction, or if the validity or enforceability of the Guaranty
shall be contested or denied by any Guarantor Subsidiary, or if any Guarantor
Subsidiary shall revoke, or deny that it has any further liability or obligation
under, the Guaranty or if any Guarantor Subsidiary shall fail to comply with or
observe any of the terms, provisions or conditions contained in the Guaranty;
then, and in every such event, the Administrative Agent shall (i) if requested
by the Required Lenders, by notice to the Borrower terminate the Revolving
Credit Commitments and the Swing Line Commitment and they shall thereupon
terminate and (ii) if requested by the Required Lenders, by notice to the
Borrower declare the Notes (together with accrued interest thereon) and the
other Obligations (other than amounts owed by the Borrower under or in respect
of any Swap Contract between the Borrower and a Lender or an affiliate of a
Lender) to be, and the Notes and other Obligations shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower; provided that in
the case of any of the Events of Default specified in clause (g) or (h) above
with respect to the Borrower, without any notice to the Borrower or any other
act by the Administrative Agent or the Lenders, the Revolving Credit Commitments
and the Swing Line Commitment shall thereupon terminate and the Notes (together
with accrued interest thereon) and the other Obligations (other than amounts
owed by the Borrower under or in respect of any Swap Contract between the
Borrower and a Lender or an affiliate of a Lender) shall become immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower. Upon the occurrence of any of
the foregoing,
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the Borrower shall immediately deposit with the Administrative Agent as cash
collateral to secure all Letter of Credit Obligations an amount in immediately
available funds equal to the undrawn portion of all Letters of Credit then
outstanding.
Section 6.02 Notice of Default. The Administrative Agent shall give
notice to the Borrower under Section 6.01(c) promptly upon being requested to do
so by any Lender and shall thereupon notify all the Lenders thereof.
ARTICLE VII
THE ADMINISTRATIVE AGENT AND LETTER OF CREDIT ISSUER
Section 7.01 Appointment. The Lenders hereby appoint the Administrative
Agent to act as specified herein and in the Loan Documents. Each Lender hereby
irrevocably authorizes and each holder of any Note by the acceptance of such
Note shall be deemed to irrevocably authorize the Administrative Agent to take
such action on its behalf under the provisions hereof, the Loan Documents
(including, without limitation, to give notices and take such actions on behalf
of the Required Lenders as are consented to in writing by the Required Lenders)
and any other instruments, documents and agreements referred to herein or
therein and to exercise such powers hereunder and thereunder as are specifically
delegated to the Administrative Agent by the terms hereof and thereof and such
other powers as are reasonably incidental thereto. The Administrative Agent may
perform any of its duties hereunder and under the Loan Documents, by or through
its officers, directors, agents, employees or affiliates.
Section 7.02 Nature of Duties. No Administrative Agent-Related Person
shall have duties or responsibilities except those expressly set forth in this
Agreement. The duties of the Administrative Agent shall be mechanical and
administrative in nature. EACH LENDER HEREBY ACKNOWLEDGES AND AGREES THAT THE
ADMINISTRATIVE AGENT SHALL NOT HAVE, BY REASON OF THIS AGREEMENT OR ANY LOAN
DOCUMENTS, A FIDUCIARY RELATIONSHIP TO OR IN RESPECT OF ANY LENDER. Nothing in
this Agreement or in any Loan Document, expressed or implied, is intended to or
shall be so construed as to impose upon any Administrative Agent-Related Person
any obligations in respect of the Agreement or any Loan Document except as
expressly set forth herein or therein. Each Lender shall make its own
independent investigation of the financial condition and affairs of the Borrower
in connection with the making and the continuance of the Loans hereunder and
shall make its own appraisal of the creditworthiness of the Borrower, and,
except as expressly set forth herein, no Administrative Agent-Related Person
shall have any duty or responsibility, either initially or on a continuing
basis, to provide any Lender with any credit or other information with respect
thereto, whether coming into its possession before making of the Loans or at any
time or times thereafter. The Administrative Agent will promptly notify each
Lender at any time that the Required Lenders have instructed it to act or
refrain from acting pursuant to Article VI. The Administrative Agent agrees,
upon the written request of the Required Lenders, to take any action of the type
specified in this Agreement or any of the other Loan Documents as being within
the Administrative Agent's rights, duties, powers or discretion. Notwithstanding
the foregoing, (a) the Administrative Agent shall be fully justified in failing
or refusing to take any action under this Agreement or any other Loan Document
unless it shall first be indemnified to its satisfaction by the Lenders pro rata
against any and all liabilities, losses, costs and expenses (including, without
limitation, attorneys' fees and expenses) which may be incurred by it by reason
of taking or continuing to take any such action, other than any liability
62
caused by the Administrative Agent's gross negligence or willful misconduct and
(b) in no event shall the Administrative Agent be required to take any action
which it in good faith believes would violate this Agreement or any other Loan
Document or any applicable law, rule or regulation.
Section 7.03 Exculpation Rights, Etc. Neither the Administrative Agent
nor any of its officers, directors, Administrative Agents, employees, affiliates
or any Administrative Agent-Related Person shall be liable for any action taken
or omitted by them hereunder or under any Loan Document or in connection
herewith or therewith, unless caused by its or their gross negligence or willful
misconduct. No Administrative Agent-Related Person shall be responsible to any
Lender for any recitals, statements, representations or warranties herein or for
the execution, effectiveness, genuineness, validity, enforceability,
collectibility, or sufficiency of this Agreement or any Loan Document or any
other document or the financial condition of the Borrower or any Subsidiary. No
Administrative Agent-Related Person shall be required to make any inquiry
concerning either the performance or observance of any of the terms, provisions
or conditions of this Agreement or any Loan Document or any other document or
the financial condition of the Borrower or any Subsidiary, or the existence or
possible existence of any Default or Event of Default, unless requested to do so
by the Required Lenders. The Administrative Agent may at any time request
instructions from the Lenders with respect to any actions or approvals
(including the failure to act or approve) which by the terms of this Agreement
or the Loan Documents, the Administrative Agent is permitted to take or to
grant, or as to any matters not expressly provided for by this Agreement and if
such instructions are requested, the Administrative Agent shall be absolutely
entitled to refrain from taking any action or to withhold any approval and shall
not be under any liability whatsoever to any person for refraining from any
action or withholding any approval under this Agreement or any Loan Document
until it shall have received such instructions from the Required Lenders.
Without limiting the foregoing, no Lender shall have any right of action
whatsoever against any Administrative Agent-Related Person as a result of such
Administrative Agent-Related Person acting, approving or refraining from acting
or approving under any of the Loan Documents in accordance with the instructions
of the Required Lenders or, to the extent required by Section 9.05, all of the
Lenders.
Section 7.04 Reliance. The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any notice, writing,
resolution notice, statement, certificate, order or other document or any
telephone, telex, teletype or telecopier message believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person, and,
with respect to all matters pertaining herein or to any Loan Document and its
duties hereunder to thereunder, upon advice of counsel selected by the
Administrative Agent.
Section 7.05 Indemnification. To the extent any Administrative
Agent-Related Person is not reimbursed and indemnified by the Borrower, the
Lenders will reimburse and indemnify each Administrative Agent-Related Person
for and against any and all liabilities, obligations, losses, damages, claims,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by or asserted
against any Administrative Agent-Related Person in any way relating to or
arising out of this Agreement or any Loan Document or any action taken or
omitted by any Administrative Agent-Related Person under this Agreement or any
Loan Document, in proportion to each Lender's Revolving Credit Commitment
Percentage; provided, however, that no Lender shall be liable to an
Agent-Related
63
Person for any portion of such liabilities, obligations, losses, damages,
claims, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from such Agent-Related Person's gross negligence or willful
misconduct. The obligations of the Lenders under this Section 7.05 shall survive
the payment in full of the Obligations and the termination of this Agreement.
Section 7.06 Administrative Agent In Its Individual Capacity. With
respect to its Loans, its Revolving Credit Commitment and its Swing Line
Commitment (and its Revolving Credit Commitment Percentage), the Administrative
Agent shall have and may exercise the same rights and powers hereunder and is
subject to the same obligations and liabilities as and, to the extent set forth
herein, for any other Lender or holder of obligations hereunder. The terms
"Lenders", "holder of obligations" or "Required Lenders" or any similar term
shall, unless the context clearly otherwise indicates, include the
Administrative Agent in its individual capacity as a Lender, one of the Required
Lenders or a holder of obligations hereunder. The Administrative Agent may
accept deposits from, lend money to and generally engage in any kind of banking,
trust or other business with the Borrower or any Subsidiary or Affiliate of the
Borrower as if it were not acting as the Administrative Agent hereunder or under
the Loan Documents, including, without limitation, the acceptance of fees or
other consideration for services without having to account for the same to any
of the Lenders.
Section 7.07 Notice of Default. The Administrative Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Administrative Agent has received written notice
from a Lender or the Borrower referring to this Agreement describing such
Default or Event of Default and stating that such notice is a "notice of
default." In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give prompt notice thereof to the Lenders.
Section 7.08 Holders of Obligations. The Administrative Agent may deem
and treat the payee of any obligation hereunder as reflected on the books and
records of the Administrative Agent as the owner thereof for all purposes hereof
unless and until a written notice of the assignment or transfer thereof shall
have been filed with the Administrative Agent pursuant to Section 9.06(c). Any
request, authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is the holder of any obligation
hereunder shall be conclusive and binding on any subsequent holder, transferee
or assignee of such obligation or of any obligation or obligations granted in
exchange therefor.
Section 7.09 Resignation by the Administrative Agent.
(a) The Administrative Agent may resign from the performance
of all its functions and duties hereunder at any time by giving twenty (20)
Business Days' prior written notice to the Borrower and the Lenders. Such
resignation shall take effect upon the acceptance by a successor Administrative
Agent of appointment pursuant to clauses (b) and (c) below or as otherwise
provided below.
(b) Upon any such notice of resignation, the Required Lenders,
with the consent of the Borrower if no Event of Default has occurred and is
continuing (which consent shall not be unreasonably withheld) shall appoint a
successor Administrative Agent who shall be reasonably satisfactory to the
Borrower and shall be an incorporated lender or trust company with combined
capital and surplus in excess of $250,000,000.
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(c) If a successor Administrative Agent shall not have been so
appointed within said twenty (20) Business Day period, the Administrative Agent,
with the consent of the Borrower (which consent shall not be unreasonably
withheld), shall then appoint a successor Administrative Agent who shall serve
as the Administrative Agent until such time, if any, as the Required Lenders,
with the consent of the Borrower if no Event of Default has occurred and is
continuing (which consent shall not be unreasonably withheld), appoint a
successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed
pursuant to clause (b) or (c) by the twenty-fifth (25th) Business Day after the
date such notice of resignation was given by Administrative Agent,
Administrative Agent's resignation shall become effective and the Required
Lenders shall thereafter perform all the duties of Administrative Agent
hereunder until such time, if any, as the Required Lenders, with the consent of
Borrower (which consent shall not be unreasonably withheld), appoint a successor
Administrative Agent as provided above.
(e) Notwithstanding the foregoing, no consent of the Borrower
to any successor Administrative Agent shall be required if any Event of Default
has occurred and is continuing.
Section 7.10 Application of Article VII to Swing Line Lender and Letter
of Credit Issuer. The provisions of this Article VII and the obligations of the
Lenders thereunder shall be deemed equally to apply to, and be for the benefit
of, the Swing Line Lender, the Swing Line Lender-Related Persons, the Letter of
Credit Issuer and the Letter of Credit Issuer-Related Persons in connection with
their administration of the Swing Line Loans, the Letters of Credit, the Letter
of Credit Obligations and the terms and provisions of Sections 2.02 and 2.16, to
the same extent that such provisions apply to the Administrative Agent, the
Administrative Agent-Related Persons, the Loans and the Obligations, mutatis
mutandis.
Section 7.11 Other Agents. Nothing in this Agreement shall impose on
the Sole Lead Arranger, in such capacity, any duties or obligations.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
Section 8.01 Basis for Determining Interest Rate Inadequate or Unfair.
If on or prior to the first day of any Interest Period for any LIBOR Borrowing:
(a) the Administrative Agent is advised by ▇▇▇▇▇ Fargo that
deposits in dollars (in the applicable amounts) are not being offered to ▇▇▇▇▇
Fargo in the relevant market for such Interest Period, or
(b) the Required Lenders advise the Administrative Agent that
the LIBOR Rate as determined by the Administrative Agent will not adequately and
fairly reflect the cost to such Lenders of funding their LIBOR Loans for such
Interest Period,
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the Administrative Agent shall forthwith give notice thereof to the Borrower and
the Lenders, whereupon until the Administrative Agent notifies the Borrower that
the circumstances giving rise to such suspension no longer exist, the
obligations of the Lenders to make LIBOR Loans shall be suspended. Unless the
Borrower notifies the Administrative Agent at least two (2) Business Days before
the date of any LIBOR Borrowing for which a Notice of Borrowing has previously
been given that it elects not to borrow on such date, any such LIBOR Borrowing
shall instead be made as a Base Rate Borrowing.
Section 8.02 Illegality. If on or after the Effective Date, the
adoption of any applicable law, rule or regulation, or any change therein, or
any change in the interpretation or administration thereof by any governmental
authority, central lender or comparable agency charged with the interpretation
or administration thereof, or compliance by any Lender (or its LIBOR Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central lender or comparable agency shall make it
unlawful or impossible for any Lender (or its LIBOR Lending Office) to make,
maintain or fund its LIBOR Loans and such Lender shall so notify the
Administrative Agent, the Administrative Agent shall forthwith give notice
thereof to the other Lenders and the Borrower, whereupon until such Lender
notifies the Borrower and the Administrative Agent that the circumstances giving
rise to such suspension no longer exist, the obligation of such Lender to make
LIBOR Loans shall be suspended. Before giving any notice to the Administrative
Agent pursuant to this Section, such Lender shall designate a different LIBOR
Lending Office if such designation will avoid the need for giving such notice
and will not, in the judgment of such Lender, be otherwise disadvantageous in
any material respect to such Lender. If such Lender shall determine that it may
not lawfully continue to maintain and fund any of its outstanding LIBOR Loans to
maturity and shall so specify in such notice, the Borrower shall immediately
prepay in full the then outstanding principal amount of each such LIBOR Loan,
together with accrued interest thereon. Concurrently with prepaying each such
LIBOR Loan, the Borrower shall borrow a Base Rate Loan in an equal principal
amount from such Lender (on which interest and principal shall be payable
contemporaneously with the related LIBOR Loans of the other Lenders), and such
Lender shall make such a Base Rate Loan. Within forty-five (45) days following
the giving of any such notice by a Lender, if requested by the Borrower, such
Lender will assign to one or more lenders or other financial institutions
selected by Borrower and acceptable to the Administrative Agent and which are
capable of funding and maintaining LIBOR Loans, all of its right and obligations
under this Agreement, the Notes and the Letter of Credit Obligations in
accordance with the procedures set forth in Section 9.06(c) of this Agreement.
Section 8.03 Increased Cost and Reduced Return.
(a) If on or after the Effective Date, the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
lender or comparable agency charged with the interpretation or administration
thereof, or compliance by any Lender (or its Applicable Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central lender or comparable agency:
(i) shall subject any Lender (or its Applicable
Lending office) to any tax, duty or other charge with respect to its LIBOR
Loans, its Note(s), its obligation to make LIBOR Loans or its Letter of Credit
Obligations (collectively, its "Covered Credits"), or shall
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change the basis of taxation of payments to any Lender (or its Applicable
Lending Office) of the principal of or interest on its LIBOR Loans or any other
amounts due under this Agreement in respect of its Covered Credits (except for
changes in the rate of franchise taxes or tax on the overall net income of such
Lender or its Applicable Lending Office imposed by the jurisdiction in which
such Lender's principal executive office or Applicable Lending Office is
located); or
(ii) shall impose, modify or deem applicable any
reserve (including, without limitation, any such requirement imposed by the
Board of Governors of the Federal Reserve System, but excluding with respect to
any LIBOR Loan any such requirement included in an applicable Reserve
Percentage), special deposit, insurance assessment or similar requirement
against assets of, deposits with or for the account of, or credit extended by,
any Lender (or its Applicable Lending Office) or shall impose on any Lender (or
its Applicable Lending Office) or on the United States market for the London
interbank market any other condition affecting its Covered Credits;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making or maintaining any Covered Credits,
or to reduce the amount of any sum received or receivable by such Lender (or its
Applicable Lending Office) under this Agreement or under its Note(s) with
respect thereto, by an amount deemed by such Lender to be material, then, within
fifteen (15) days after demand by such Lender (with a copy to the Administrative
Agent), the Borrower shall pay to such Lender such additional amount or amounts
as will compensate such Lender for such increased cost or reduction.
(b) If any Lender shall have determined that, after the
Effective Date, the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central lender or
comparable agency charged with the interpretation or administration thereof, or
any request or directive regarding capital adequacy (whether or not having the
force of law) of any such authority, central lender or comparable agency, has or
would have the effect of reducing the rate of return on capital of such Lender
(or its Parent) as a consequence of such Lender's obligations hereunder to a
level below that which such Lender (or its Parent) could have achieved but for
such adoption, change, request or directive (taking into consideration its
policies with respect to 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 (with a copy to the Administrative Agent), the Borrower shall pay to
such Lender such additional amount or amounts as will compensate such Lender (or
its Parent) for such reduction.
(c) Each Lender will promptly notify the Borrower and the
Administrative Agent of any event of which it has knowledge, occurring after the
Effective Date, which will entitle such Lender to compensation pursuant to this
Section and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Lender, be otherwise disadvantageous in
any material respect to such Lender. A certificate of any Lender claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Lender may use any reasonable
averaging and attribution methods.
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Section 8.04 Base Rate Loans Substituted for Affected LIBOR Loans. If
(i) the obligation of any Lender to make LIBOR Loans has been suspended pursuant
to Section 8.02 or (ii) any Lender has demanded compensation under Section
8.03(a), then, unless and until such Lender notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer apply:
(a) all Revolving Credit Loans which would otherwise be made
by such Lender as LIBOR Loans shall be made instead as Base Rate Loans (on which
interest and principal shall be payable contemporaneously with the related LIBOR
Loans of the other Lenders), and
(b) after each of its LIBOR Loans has been repaid, all
payments of principal which would otherwise be applied to repay such LIBOR Loans
shall be applied to repay its Base Rate Loans instead.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including lender wire, telex, facsimile
transmission or similar writing) and shall be given to such party: (a) in the
case of the Borrower or the Administrative Agent, at its address or telex number
set forth on Schedule 9.01 hereto, (b) in the case of any Lender, at its address
or telex number set forth in its Administrative Questionnaire or (c) in the case
of any party, such other address or telex number as such party may hereafter
specify for the purpose by notice to the Administrative Agent and the Borrower.
Each such notice, request or other communication shall be affective (a) if given
by telex or facsimile transmission, when such telex or facsimile transmission is
transmitted to the telex or facsimile number specified in this Section and the
appropriate answerback or receipt of transmission is received, (b) if given by
mail, three (3) Business Days after such communication is deposited in the mail
with first class postage prepaid, addressed as aforesaid or (c) if given by any
other means, when delivered at the address specified in this Section; provided
that notices to the Administrative Agent under Article II or Article VIII shall
not be effective until received.
Section 9.02 No Waivers. No failure or delay by the Administrative
Agent or any Lender in exercising any right, power or privilege hereunder, under
any Note or under any other Loan Document shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
Section 9.03 Expenses; Documentary Taxes; Indemnification.
(a) The Borrower shall pay (i) all reasonable out-of-pocket
expenses of the Administrative Agent, including fees and disbursements of
counsel for the Administrative Agent, in connection with the negotiation,
preparation, syndication and administration of this Agreement and the other Loan
Documents, (ii) all reasonable out-of-pocket expenses of the Administrative
Agent, including fees and disbursements of counsel to the Administrative Agent,
in connection with any waiver or consent under this Agreement or any of the
other Loan
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Documents or any amendment, modification, extension, renewal, supplement or
restatement of or to this Agreement or any other Loan Document or any Default or
Event of Default or alleged Default or Event of Default under this Agreement and
(iii) if an Event of Default occurs and is continuing, all out-of-pocket
expenses incurred by the Administrative Agent and each Lender, including fees
and disbursements of outside counsel, in connection with such Event of Default
and collection, bankruptcy, insolvency and other enforcement proceedings
resulting therefrom. The Borrower shall indemnify each Lender against any
transfer taxes, documentary taxes, assessments or charges made by any
governmental authority by reason of the execution and delivery of this
Agreement, the Notes or any of the other Loan Documents.
(b) The Borrower agrees to indemnify each Lender and hold each
Lender harmless from and against any and all liabilities, losses, damages, costs
and expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by any Lender (or by the
Administrative Agent in connection with its actions as Administrative Agent
hereunder, by the Swing Line Lender in connection with its actions as Swing Line
Lender hereunder or by the Letter of Credit Issuer in connection with its
actions as Letter of Credit Issuer hereunder) in connection with any
investigative, administrative or judicial proceeding (whether or not such Lender
shall be designated a party thereto) relating to or arising out of this
Agreement or any actual or proposed use of proceeds of Loans hereunder or any
actual or proposed use of any Letter of Credit; provided that none of the
Administrative Agent, the Swing Line Lender, the Letter of Credit Issuer or any
Lender shall have the right to be indemnified hereunder for its own gross
negligence or willful misconduct.
Section 9.04 Sharing Among Lenders. Each Lender agrees that if it
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it which is greater than the proportion
received by any other Lender in respect of the aggregate amount of principal and
interest due with respect to any Note held by such other Lender, the Lender
receiving such proportionate greater payment shall purchase such participations
in the Notes held by the other Lenders, and such other adjustments shall be
made, as may be required so that all such payments of principal and interest
with respect to the Notes held by the Lenders shall be shared by the Lenders pro
rata; provided that nothing in this Section shall impair the right of any Lender
to exercise any right of set-off or counterclaim it may have and to apply the
amount subject to such exercise to the payment of indebtedness of the Borrower
other than its indebtedness under the Notes. The Lenders further agree among
themselves that if any such excess payment to a Lender shall be rescinded or
must otherwise be restored, the other Lender(s) which shall have shared the
benefit of such payment shall, by repurchase of participation theretofore sold,
or otherwise, return its share of that benefit to the Lender(s) whose payment
shall have been rescinded or otherwise restored. The Borrower agrees, to the
fullest extent it may effectively do so under applicable law, that any holder of
a participation in a Note, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other rights
with respect to such participation as fully as if such holder of a participation
were a direct creditor of the Borrower in the amount of such participation.
Section 9.05 Amendments and Waivers. Any provision of this Agreement,
the Notes or the Guaranty may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Borrower and the Required
Lenders (and, if the rights or duties of the Administrative Agent, the Swing
Line Lender or the Letter of Credit Issuer are affected thereby,
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by the Administrative Agent, the Swing Line Lender or the Letter of Credit
Issuer, as the case may be); provided, however, that (a) any amendment to this
Agreement which solely increases the total Revolving Credit Commitments to up
to, but not in excess of, $150,000,000 either through the addition of one or
more new Lenders or an increase in the Revolving Credit Commitments of one or
more of the existing Lenders and makes no other changes to this Agreement or any
other Loan Document (other than the issuance of conforming Revolving Credit
Notes), need only be signed by the Administrative Agent, the Borrower and the
Lender(s) whose Revolving Credit Commitments are increased and (b) no such
amendment or waiver shall, unless signed by each Lender (i) extend the
Termination Date or increase the Revolving Credit Commitment of such Lender,
(ii) decrease the Revolving Credit Commitment of any Lender (except for a
ratable decrease in the Revolving Credit Commitments of all Lenders), (iii)
increase the total Revolving Credit Commitments above $150,000,000, (iv) reduce
the principal of or rate of interest on any Loan, Letter of Credit Obligation or
any fees hereunder, (v) postpone the date fixed for any payment of principal of
or interest on any Loan, Letter of Credit Obligation or any fees hereunder or
for any reduction or termination of any Revolving Credit Commitment or the Swing
Line Commitment, (vi) change the definition of "Required Lenders", (vii) release
any security interest or lien upon Borrower's ownership interest in any Foreign
Subsidiary, (viii) voluntarily release any Guarantor Subsidiary from its
obligations under the Guaranty unless such release is the result of a
transaction permitted by Section 5.12(c), (ix) amend Section 9.04, (x) amend
this Section 9.05 or (xi) change the percentage of the Revolving Credit
Commitments or of the aggregate unpaid principal amount of the Revolving Credit
Notes or the Letter of Credit Obligations, or the number of Lenders, which shall
be required for the Lenders or any of them to take any action under this Section
or any other provision of this Agreement.
Section 9.06 Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns, except that the Borrower may not assign or otherwise transfer any of
its rights under this Agreement without the prior written consent of all of the
Lenders in their sole discretion.
(b) Any Lender may, with the prior written consent of the
Borrower and the Administrative Agent, such consents not to be unreasonably
withheld, provided, that if a Participant is an Affiliate of the granting Lender
neither the Borrower's nor the Administrative Agent's consent shall be required
and provided further that if an Event of Default has occurred and is continuing,
the Borrower's consent shall not be required, at any time grant to one or more
lenders or other financial institutions (each, a "Participant") participating
interests in its Revolving Credit Commitment or any or all of its Loans and
Letter of Credit Obligations. In the event of any such grant by a Lender of a
participating interest to a Participant, such Lender shall remain responsible
for the performance of its obligations hereunder, and the Borrower and the
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations under this Agreement.
Any agreement pursuant to which any Lender may grant such a participating
interest shall provide that such Lender shall retain the sole right and
responsibility to enforce the obligations of the Borrower hereunder including,
without limitation, the right to approve any amendment, modification or waiver
of any provision of this Agreement; provided that such participation agreement
may provide that such Lender will not agree to any modification, amendment or
waiver of this Agreement described in sub-clauses (i), (ii), (iii), (iv) or (v)
of clause (b) of the proviso in Section 9.05 without the
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consent of the Participant. The Borrower agrees that each Participant shall, to
the extent provided in its participation agreement, be entitled to the benefits
of Article VIII with respect to its participating interest. An assignment or
other transfer which is not permitted by subsection (c) or (d) below shall be
given effect for purposes of this Agreement only to the extent of a
participating interest granted in accordance with this subsection (b).
(c) (i) Any Lender may at any time assign to one or more
lenders or other financial institutions (each, an "Assignee") all, or a
proportionate part (such portion to be in an amount equal to or greater than
$5,000,000) of all, of its rights and obligations under this Agreement, the
Notes and the Letter of Credit Obligations, and such Assignee shall assume such
rights and obligations, pursuant to an assignment and assumption agreement in
substantially the form of Exhibit F hereto (an "Assignment and Assumption
Agreement") executed by such Assignee and such transferor Lender, with (and
subject to) the subscribed consent of the Borrower and the Administrative Agent,
such consents not to be unreasonably withheld; provided, that an Assignee not an
Affiliate of such transferor Lender or another Lender must be a financial
institution with combined capital and surplus in excess of $250,000,000;
provided further that if an Assignee is an Affiliate of such transferor Lender
(including a trust established to administer loans sold by such Lender or its
Affiliates to such trust, which trust is and shall continue to be administered
by such Lender or an Affiliate thereof) neither the Borrower's nor the
Administrative Agent's consent shall be required, provided that such transferor
Lender shall remain fully obligated under this Agreement for all funding and
payment obligations; and provided further that if an Event of Default has
occurred and is continuing, the Borrower's consent shall not be required.
(ii) Upon (A) execution of an Assignment and Assumption
Agreement and the payment of a nonrefundable assignment fee of $3,500 in
immediately available funds to the Administrative Agent at its Payment Office in
connection with each such assignment, (B) written notice of such assignment by
such transferor Lender to the Administrative Agent and (C) the recording by the
Administrative Agent of such assignment in the Register and the resulting effect
upon the Loans and Letter of Credit Obligations of the assigning Lender and the
Assignee, the Assignee shall have, to the extent of such assignment, the same
rights and benefits as it would have if it were a Lender hereunder and the
holder of a Note and Letter of Credit Obligations (provided that the Borrower
and the Administrative Agent shall be entitled to continue to deal solely and
directly with the assignor Lender in connection with the interests so assigned
to the Assignee until written notice of such assignment, together with payment
instructions, addresses and related information with respect to the Assignee,
shall have been given to the Borrower and the Administrative Agent by the
assignor Lender and the Assignee) and, if the Assignee has expressly assumed,
for the benefit of the Borrower, some or all of the transferor Lender's
obligations hereunder, such transferor Lender shall be relieved of its
obligations hereunder to the extent of such assignment and assumption, and
except as described above, no further consent or action by the Borrower, the
Lenders or the Administrative Agent shall be required.
(iii) If the Assignee is not incorporated under the laws
of the United States of America or a state thereof, it shall, prior to the first
date on which interest or fees are payable hereunder for its account, deliver to
the Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in accordance
with Section 2.15.
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(iv) Each Assignee shall take such Loans, Letter of
Credit Obligations and Revolving Credit Commitment subject to the provisions of
this Agreement and to any request made, waiver or consent given or other action
taken hereunder, prior to the receipt by the Administrative Agent and the
Borrower of written notice of such transfer, by each previous holder of such
Loans, Letter of Credit Obligations and Revolving Credit Commitment. Such
Assignment and Assumption Agreement shall be deemed to amend this Agreement and
Schedule 1.01 hereto, to the extent, and only to the extent, necessary to
reflect the addition of such Assignee as a Lender and the resulting adjustment
of all or a portion of the rights and obligations of such transferor Lender
under this Agreement, the determination of its Revolving Credit Commitment
Percentage (in each case, rounded to twelve decimal places), the Loans, the
Letter of Credit Obligations and any new Notes to be issued, at the Borrower's
expense, to such Assignee, and no further consent or action by the Borrower or
the Lenders shall be required to effect such amendments.
(d) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time pledge or assign all or any portion of its
rights under this Agreement and the other documents executed and delivered in
connection herewith (including, without limitation, the Note held by it) to any
Federal Reserve Lender in accordance with Regulation A of the Federal Reserve
Board without notice to, or the consent of, the Borrower or the Administrative
Agent and with the consent of the Borrower and the Administrative Agent, any
Lender which is a fund may pledge all or any portion of its Notes or Loans to
its trustee in support of its obligations to its trustee. No such pledge or
assignment shall release the transferor Lender from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any
Lender's rights shall be entitled to receive any greater payment under Section
8.03 than such Lender would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrower's prior
written consent or by reason of the provisions of Section 8.02 or 8.03 requiring
such Lender to designate a different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.
(f) The Borrower hereby designates the Administrative Agent to
serve as the Borrower's Administrative Agent, solely for purposes of this
Section 9.06 to maintain a register (the "Register") on which it will record the
Loans made and Letter of Credit Obligations held by each of the Lenders and each
repayment in respect of the principal amount of the Loans and Letter of Credit
Obligations of each Lender. Failure to make any such recordation, or any error
in such recordation shall not affect the Borrower's obligations in respect of
such Loans or Letters of Credit. With respect to any Lender, the transfer of the
rights to the principal of, and interest on, any Loan or Letter of Credit
Obligation shall not be effective until the transfer is recorded on the Register
maintained by the Administrative Agent with respect to ownership of such Loan or
Letter of Credit Obligation and prior to such recordation all amounts owing to
the transferor with respect to such Loan or Letter of Credit Obligation shall
remain owing to the transferor. The registration of assignment or transfer of
all or part of any Loans or Letter of Credit Obligations shall be recorded by
the Administrative Agent on the Register only upon the acceptance by the
Administrative Agent of a properly executed and delivered Assignment and
Assumption Agreement pursuant to Section 9.06(c). Coincident with the delivery
of such an Assignment and Assumption Agreement to the Administrative Agent for
acceptance and registration of
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assignment or transfer of all or part of a Loan or Letter of Credit Obligation,
or as soon thereafter as practicable, the assigning or transferor Lender shall
surrender the Note evidencing such Loan or Letter of Credit Obligation, and
thereupon one or more new Notes in the same aggregate principal amount then
owing to such assignor or transferor Lender shall be issued to the assigning or
transferor Lender and/or the new Lender. The Borrower agrees to indemnify the
Administrative Agent from and against any and all losses, claims, damages and
liabilities of whatsoever nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its duties under this Section
9.06(f); provided that the Administrative Agent shall not have the right to be
indemnified under this Section 9.06(f) for its own gross negligence or willful
misconduct.
Section 9.07 Collateral. Each of the Lenders represents to the
Administrative Agent and each of the other Lenders that in good faith is not
relying upon any "margin stock" (as defined in Regulation U) as collateral in
the extension or maintenance of the credit provided for in this Agreement.
Section 9.08 Governing Law. This Agreement and each Note shall be
governed by and construed in accordance with the substantive laws of the state
of Missouri, without giving effect to the application of choice of law
principles.
Section 9.09 Counterparts. This Agreement may be signed in any number
of counterparts (including facsimile counterparts), each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument.
Section 9.10 NO ORAL AGREEMENTS; ENTIRE AGREEMENT. ORAL AGREEMENTS OR
COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT
OF A DEBT, INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT, ARE NOT ENFORCEABLE,
REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED THAT IS IN ANY WAY RELATED
TO THE CREDIT AGREEMENT. TO PROTECT THE BORROWER, THE LENDERS, THE SWING LINE
LENDER, THE LETTER OF CREDIT ISSUER AND THE ADMINISTRATIVE AGENT FROM
MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS REACHED BY THE BORROWER, THE
LENDERS, THE SWING LINE LENDER, THE LETTER OF CREDIT ISSUER AND THE
ADMINISTRATIVE AGENT COVERING SUCH MATTERS ARE CONTAINED IN THIS AGREEMENT AND
THE OTHER LOAN DOCUMENTS, WHICH AGREEMENT AND OTHER LOAN DOCUMENTS ARE A
COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENTS AMONG THE BORROWER, THE
LENDERS, THE SWING LINE LENDER, THE LETTER OF CREDIT ISSUER AND THE
ADMINISTRATIVE AGENT, EXCEPT AS THE BORROWER, THE LENDERS, THE SWING LINE
LENDER, THE LETTER OF CREDIT ISSUER AND THE ADMINISTRATIVE AGENT MAY LATER AGREE
IN WRITING TO MODIFY THEM. This Agreement embodies the entire agreement and
understanding between the parties hereto and supersedes all prior agreements and
understandings (oral or written) relating to the subject matter hereof.
Section 9.11 Confidentiality. The Administrative Agent and each Lender
represent that they will maintain the confidentiality of any written or oral
information provided under this
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Agreement by or on behalf of the Borrower (hereinafter collectively called
"Confidential Information"), subject to the Administrative Agent's and each
Lender's (a) obligation to disclose any such Confidential Information pursuant
to a request or order under applicable laws and regulations or pursuant to a
subpoena or other legal process, (b) right to disclose any such Confidential
Information to its lender examiners, auditors, counsel and other professional
advisors and to other Lenders, (c) right to disclose any such Confidential
Information in connection with any litigation or dispute involving the Lenders
and the Borrower or any of its Subsidiaries and Affiliates and (d) right to
provide such information to Participants, prospective Participants to which
sales of participating interests are permitted pursuant to Section 9.06(b) and
prospective Assignees to which assignments of interests are permitted pursuant
to Section 9.06(c) if such Participant, prospective Participant or prospective
Assignee agrees in writing to maintain the confidentiality of such information
on terms substantially similar to those of this Section as if it were a "Lender"
party hereto. Notwithstanding the foregoing, any such information supplied to a
Lender, Participant, prospective Participant or prospective Assignee under this
Agreement shall cease to be Confidential Information if it is or becomes known
to such Person by other than unauthorized disclosure, or if it becomes a matter
of public knowledge.
Section 9.12 Consent to Jurisdiction; Waiver of Jury Trial. THE
BORROWER IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY MISSOURI
STATE COURT SITTING IN ST. LOUIS COUNTY, MISSOURI AND/OR ANY UNITED STATES OF
AMERICA COURT SITTING IN THE EASTERN DISTRICT OF MISSOURI, EASTERN DIVISION, AS
THE ADMINISTRATIVE AGENT MAY ELECT, IN ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT. THE BORROWER
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT TO SUCH SUIT, ACTION OR
PROCEEDING MAY BE HELD AND DETERMINED IN ANY OF SUCH COURTS. THE BORROWER
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
THE BORROWER MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT, AND THE BORROWER FURTHER
IRREVOCABLY WAIVES ANY CLAIM THAT SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE BORROWER AUTHORIZES
THE SERVICE OF PROCESS UPON BORROWER BY REGISTERED MAIL SENT TO BORROWER AT ITS
ADDRESS DETERMINED PURSUANT TO SECTION 9.01. EACH OF THE BORROWER, THE
ADMINISTRATIVE AGENT, THE SWING LINE LENDER, THE LETTER OF CREDIT ISSUER AND
EACH LENDER HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section 9.13 Independence of Covenants. All of the covenants contained
in this Agreement and the other Loan Documents shall be given independent effect
so that if a particular action, event or condition is prohibited by any one of
such covenants, the fact that it would be permitted by an exception to, or
otherwise be in compliance within the provisions of, another covenant shall not
avoid the occurrence of a Default or Event of Default if such action is taken,
such event occurs or such condition exists.
74
Section 9.14 Distribution of Material. The Borrower agrees that the
Agent may make any material delivered by the Borrower to the Agent, as well as
any amendments, waivers, consents, and other written information, documents,
instruments and other materials relating to the Borrower, any of its
Subsidiaries, or any other materials or matters relating to this Agreement, the
Notes or any of the transactions contemplated hereby (collectively, the
"Communications") available to the Lenders by posting such notices on an
electronic delivery system (which may be provided by the Agent, an Affiliate of
the Agent, or any Person that is not an Affiliate of the Agent), such an
IntraLinks, or a substantially similar electronic system (the "Platform"). The
Borrower acknowledges that (i) the distribution of material through an
electronic medium is not necessarily secure and that there are confidentiality
and other risks associated with such distribution, (ii) the Platform is provided
"as is" and "as available" and (iii) neither the Agent nor any of its Affiliates
warrants the accuracy, completeness, timeliness, sufficiency, or sequencing of
the Communications posted on the Platform. The Agent and its Affiliates
expressly disclaim with respect to the Platform any liability for errors in
transmission, incorrect or incomplete downloading, delays in posting or
delivery, or problems accessing the Communications posted on the Platform and
any liability for any losses, costs, expenses or liabilities that may be
suffered or incurred in connection with the Platform. No warranty of any kind,
express, implied or statutory, including, without limitation, any warranty of
merchantability, fitness for a particular purpose, non-infringement of third
party rights or freedom from viruses or other code defects, is made by the Agent
or any of its Affiliates in connection with the Platform.
Each Lender agrees that notice to it (as provided in the next sentence)
(a "Notice") specifying that any Communication has been posted to the Platform
shall for purposes of this Agreement constitute effective delivery to such
Lender of such information, documents or other materials comprising such
Communication. Each Lender agrees (i) to notify, on or before the date such
Lender becomes a party to this Agreement, the Agent in writing of such Lender's
e-mail address to which a Notice may be sent (and from time to time thereafter
to ensure that the Agent has on record an effective e-mail address for such
Lender) and (ii) that any Notice may be sent to such e-mail address.
[signature page follows]
75
IN WITNESS WHEREOF, the parties hereto have caused this Credit
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
ESCO TECHNOLOGIES INC.
By_________________________________________
Name:______________________________________
Title:_____________________________________
▇▇▇▇▇ FARGO BANK, NATIONAL
ASSOCIATION, in its individual capacity
and as Swing Line Lender, Letter of Credit
Issuer, Administrative Agent and
Sole Lead Arranger
By_________________________________________
Name:______________________________________
Title:_____________________________________
BANK OF AMERICA, N.A.
By_________________________________________
Name:______________________________________
Title:_____________________________________
LASALLE BANK NATIONAL ASSOCIATION
By_________________________________________
Name:______________________________________
Title:_____________________________________
BANK ONE, N.A.
By_________________________________________
Name:______________________________________
Title:_____________________________________
76
COMMERCE BANK, N.A.
By_________________________________________
Name:______________________________________
Title:_____________________________________
THE NORTHERN TRUST COMPANY
By_________________________________________
Name:______________________________________
Title:_____________________________________
77
SCHEDULE 1.01
REVOLVING CREDIT COMMITMENTS
Lender Revolving Credit Commitment
------ ---------------------------
▇▇▇▇▇ Fargo Bank, National Association $ 25,000,000
Bank of America, N.A. $ 21,000,000
LaSalle Bank National Association $ 16,500,000
Bank One, N.A. $ 12,500,000
Commerce Bank, N.A. $ 12,500,000
The Northern Trust Company $ 12,500,000
------------
TOTAL $100,000,000
78
SCHEDULE 4.05
LITIGATION
None.
79
SCHEDULE 4.06
ERISA
None.
80
SCHEDULE 4.09
SUBSIDIARIES
Jurisdiction of
Domestic Subsidiaries of Borrower: Incorporation Owned by % of Ownership
---------------------------------- ------------- -------- --------------
ESCO Technologies Holding Inc. ▇▇ ▇▇▇▇ Technologies Inc. 100%
PTI Technologies Inc. ▇▇ ▇▇▇▇ Technologies Holding Inc. 100%
Filtertck Inc. ▇▇ ▇▇▇▇ Technologies Holding Inc. 100%
VACCO Industries CA ESCO Technologies Holding Inc. 100%
ETS-▇▇▇▇▇▇▇▇, ▇.▇. TX Rantec Holdings, Inc. 99%
Rantec Commercial, Inc. 1%
Distribution Control Systems, Inc. MO ESCO Technologies Holding Inc. 100%
Rantec Holdings, Inc. MO ESCO Technologies Holding Inc. 100%
Rantec Commercial, Inc. CA Rantec Holdings, Inc. 100%
Comtrak Technologies, L.L.C. MO ESCO Technologies Holding Inc. 99%
Comtrak International Services, Inc. MO Comtrak Technologies, L.L.C. 100%
▇▇▇▇▇▇▇▇▇ Europe, Inc. ▇▇ ▇▇▇▇ Technologies Holding Inc. 100%
▇▇▇▇▇▇▇▇ ▇▇ Enclosures, Inc. IL ESCO Technologies Holding Inc. 100%
▇▇▇▇▇▇▇▇, Inc. ▇▇ ▇▇▇▇ Technologies Holding Inc. 100%
Filtertek de Puerto Rico Inc. DE Filtertek Inc. 100%
ESCO de Mexico Holding Inc. ESCO Technologies Holding Inc. 100%
▇▇▇▇▇▇▇▇ PRC Holding Inc. DE ▇▇▇▇▇▇▇▇ ▇▇ Enclosures, Inc. 100%
Foreign Subsidiaries of Borrower
Filtertek SA France Filtertek Inc. 72%
Filtertek BV 28%
Filtertek do Brazil Industria E Commercio Ltda. Brazil Filtertek Inc. 99.999%
Filtertek de Puerto Rico Inc. 0.001%
Filtertek BV Netherlands Filtertek Inc. 100%
Filtertek GmbH Germany Filtertek Inc. 100%
Filtrotec, Inc. Puerto Rico Filtertek Inc. 100%
Distribution Control Systems Caribe, Inc. Puerto Rico Distribution Control Systems, Inc. 100%
Distribution Control Systems do Brazil Ltda. Brazil Distribution Control Systems, Inc. 100%
Nansen-DCSI Technologies S.A. Brazil Distribution Control Systems do Brazil
Ltda. 51%
▇▇▇▇▇▇ ▇.▇. Instruments de Precisao 49%
ESCO Electronics De Mexico S-A. de C.V. Mexico ESCO de Mexico Holding Inc. 99%
ESCO Technologies Holding Inc. 1%
ETS-▇▇▇▇▇▇▇▇ Japan, Inc. Japan ESCO Technologies Holding Inc. 100%
Euroshield Oy Finland ESCO Technologies Holding Inc. 100%
Ray Proof Limited England ▇▇▇▇▇▇▇▇, Inc. 100%
▇▇▇▇▇▇▇▇▇ Limited England ▇▇▇▇▇▇▇▇▇ Europe, Inc. 100%
ETS-▇▇▇▇▇▇▇▇ do Brasil Ltda. Brazil ▇▇▇▇▇▇▇▇ ▇▇ Enclosures Inc. 100%
Beijing ▇▇▇▇▇▇▇▇ Technology Service Co., Ltd. China ▇▇▇▇▇▇▇▇ PRC Holding Inc. 100%
Beijing ▇▇▇▇▇▇▇▇ ElectronMagnetic Technology Service Co.,
Ltd. China ▇▇▇▇▇▇▇▇ PRC Holding Inc. 100%
81
SCHEDULE 4.17
EXISTING DEBT
1) Letters of Credit
Issuing
Bank LC # Amount
---- ---- ------
Bank of America 3026661 200,000.00
Bank of America 3026660 2,050,000.00
------------
SUBTOTAL 2,250,000.00
Commerce SLC00001786 28,458.00
Commerce SLC00001787 28,330.00
Commerce SLC00001788 119,030.00
Commerce SLC00001789 121,318.00
Commerce SB96005711 270,000.00
Commerce SLC00002197 229,000.00
Commerce SLC00002305 121,260.00
Commerce SLC00002092 32,000.00
Commerce SLC00002091 12,838.00
------------
SUBTOTAL 962,234.00
TOTAL 3,212,234.00
============
2) Other Debt
Issuing Bank Type of Debt Amount
------------ ------------ ------
Nordea Bank Finland PLC Loan 541,170.00
Note: Euroshield Oy (Finland) has a Guarantee facility of Euro's 1,345,000 (one
million three hundred forty-five thousand) and a loan facility of Euro's
2,000,000 (two-million) with Nordea Bank Finland PLC. The Facilities are secured
by a mortgage on the assets of Euroshield Oy. ESCO Technologies Inc. has
provided and continues to provide a guaranty of the Facilities to Nordea Bank
Finland PLC.
82
SCHEDULE 5.11
EXISTING LIENS
Euroshield Oy (Finland) has a Guarantee facility of Euro's 1,345,000 (one
million three hundred forty-five thousand) and a loan facility of Euro's
2,000,000 (two-million) with Nordea Bank Finland PLC. The Facilities are secured
by a mortgage on the assets of Euroshield Oy. ESCO Technologies Inc. has
provided and continues to provide a guaranty of the Facilities to Nordea Bank
Finland PLC.
83
SCHEDULE 9.01
NOTICE INFORMATION
ESCO Technologies Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
MAC ▇▇▇▇▇-▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
84
EXHIBIT A
[Date]
▇▇▇▇▇ Fargo Bank, National Association,
as Administrative Agent
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇-▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Agency Syndication Group - ▇▇▇▇▇ ▇▇▇▇
Re: Notice of Revolving Credit Borrowing
Ladies and Gentlemen:
Reference is hereby made to that certain Credit Agreement dated as of
October ___, 2004, by and among ESCO Technologies Inc. (the "Borrower"), the
Lenders from time to time party thereto, ▇▇▇▇▇ Fargo Bank, National Association,
as Administrative Agent for the Lenders and ▇▇▇▇▇ Fargo Bank, National
Association, as Sole Lead Arranger, as the same may be amended, modified,
extended, renewed, supplemented or restated from time to time (the "Credit
Agreement"). All capitalized terms used and not otherwise defined herein shall
have the respective meanings ascribed to them in the Credit Agreement.
The Borrower hereby requests that the Lenders make a Revolving Credit Loan
in the aggregate principal amount of $___________ to Borrower under the terms of
the Credit Agreement on (which is a Business Day). Of the requested Revolving
Credit Loan, $_______ is to be a Base Rate Loan and $ is to be a LIBOR Loan. The
Interest Period for the portion of the requested Revolving Credit Loan that is a
LIBOR Loan is ______________.
The undersigned hereby certifies that all of the conditions precedent
under Section 3.02 of the Credit Agreement have been satisfied.
Executed this _________ day of ______________, 20____.
ESCO TECHNOLOGIES INC.
By ___________________________________
Name: ________________________________
Title: _______________________________
85
EXHIBIT B
[Date]
▇▇▇▇▇ Fargo Bank, National Association,
as Administrative Agent
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇-▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Agency Syndication Group - ▇▇▇▇▇ ▇▇▇▇
Re: Notice of Swing Line Borrowing
Ladies and Gentlemen:
Reference is hereby made to that certain Credit Agreement dated as of
October ___, 2004, by and among ESCO Technologies Inc. (the "Borrower"), the
Lenders from time to time party thereto, ▇▇▇▇▇ Fargo Bank, National Association,
as Administrative Agent for the Lenders and ▇▇▇▇▇ Fargo Bank, National
Association, as Sole Lead Arranger, as the same may be amended, modified,
extended, renewed, supplemented or restated from time to time (the "Credit
Agreement"). All capitalized terms used and not otherwise defined herein shall
have the respective meanings ascribed to them in the Credit Agreement.
The Borrower hereby requests that the Swing Line Lender make a Swing Line
Loan in the aggregate principal amount of $ to Borrower under the terms of the
Credit Agreement on (which is a Business Day).
The undersigned hereby certifies that all of the conditions precedent
under Section 3.03 of the Credit Agreement have been satisfied.
Executed this __________ day of ________________, 20 ____.
ESCO TECHNOLOGIES INC.
By ___________________________________
Name: ________________________________
Title: _______________________________
86
EXHIBIT C
REVOLVING CREDIT NOTE
$_____________ __________, 20 ___
FOR VALUE RECEIVED, the undersigned, ESCO TECHNOLOGIES INC., a Missouri
corporation (the "Borrower"), hereby promises to pay to the order of (the
"Lender"), the principal sum of . Dollars ($ ), or, if less, the aggregate
unpaid principal amount of the Revolving Credit Loans (as defined in the Credit
Agreement which is hereinafter defined; capitalized terms used herein and not
otherwise defined herein shall have the meaning ascribed thereto in the Credit
Agreement) made by the Lender to the Borrower pursuant to the Credit Agreement,
on the Termination Date, together with interest on any and all principal amounts
remaining unpaid hereunder from time to time outstanding. The unpaid principal
amount hereof shall bear interest at the rate or rates provided for in the
Credit Agreement. Prior to maturity, whether by acceleration or otherwise,
accrued interest shall be payable at such times as set forth in the Credit
Agreement. After maturity, whether by acceleration or otherwise, accrued
interest shall be payable upon demand. Interest shall be computed as provided in
the Credit Agreement. Both principal and interest are payable in lawful money of
the United States of America to the Administrative Agent at the Payment Office,
in immediately available funds. Amounts advanced hereunder may be repaid and
reborrowed from time to time as provided for in the Credit Agreement.
This Note is a Revolving Credit Note referred to in, and is entitled to
the benefits of, the Credit Agreement, dated as of October ___, 2004 (as the
same may be amended, modified, extended, renewed, supplemented or restated from
time to time, the "Credit Agreement") by and among the Borrower, the financial
institutions signatory thereto (the "Lenders"), ▇▇▇▇▇ Fargo Bank, National
Association as Administrative Agent (the "Administrative Agent") for the Lenders
and ▇▇▇▇▇ Fargo Bank, National Association, as Sole Lead Arranger, the terms,
covenants, conditions, provisions, stipulations and agreements of which are made
a part hereof to the same extent and with the same effect as if fully set forth
herein. The Credit Agreement, among other things, contains provisions for
acceleration of the maturity hereof upon the happening of certain stated events
and also for prepayments on account of principal hereof prior to the maturity
hereof upon the terms and conditions therein specified.
THE BORROWER HEREBY WAIVES PRESENTMENT, DEMAND, PROTEST OR NOTICE OF ANY
KIND IN CONNECTION WITH THIS NOTE.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
SUBSTANTIVE LAWS OF THE STATE OF MISSOURI WITHOUT REGARD TO PRINCIPLES OF
CONFLICT OF LAW.
87
IN WITNESS WHEREOF, the Borrower has duly executed and delivered this
Revolving Credit Note as of the date first written above.
ESCO TECHNOLOGIES INC.
By ___________________________________
Name: ________________________________
Title: _______________________________
88
EXHIBIT D
SWING LINE NOTE
$7,500,000.00 October ___, 2004
FOR VALUE RECEIVED, the undersigned, ESCO TECHNOLOGIES INC., a Missouri
corporation (the "Borrower"), hereby promises to pay to the order of ▇▇▇▇▇ FARGO
BANK, NATIONAL ASSOCIATION (the "Lender"), the principal sum of Seven Million
Five Hundred Thousand Dollars ($7,500,000.00), or, if less, the aggregate unpaid
principal amount of the Swing Line Loans (as defined in the Credit Agreement
which is hereinafter defined; capitalized terms used herein and not otherwise
defined herein shall have the meaning ascribed thereto in the Credit Agreement)
made by the Lender to the Borrower pursuant to the Credit Agreement, on the due
dates set forth in the Credit Agreement, together with interest on any and all
principal amounts remaining unpaid hereunder from time to time outstanding. The
unpaid principal amount hereof shall bear interest at the rate or rates provided
for in the Credit Agreement. Prior to maturity, whether by acceleration or
otherwise, accrued interest shall be payable at such times as set forth in the
Credit Agreement. After maturity, whether by acceleration or otherwise, accrued
interest shall be payable upon demand. Interest shall be computed as provided in
the Credit Agreement. Both principal and interest are payable in lawful money of
the United States of America to the Administrative Agent at the Payment Office,
in immediately available funds. Amounts advanced hereunder may be repaid and
reborrowed from time to time as provided for in the Credit Agreement.
This Note is the Swing Line Note referred to in, and is entitled to the
benefits of, the Credit Agreement, dated as of October ___, 2004 (as the same
may be amended, modified, extended, renewed, supplemented or restated from time
to time, the "Credit Agreement") by and among the Borrower, the financial
institutions signatory thereto (the "Lenders"), ▇▇▇▇▇ Fargo Bank, National
Association as Administrative Agent (the "Administrative Agent") for the Lenders
and ▇▇▇▇▇ Fargo Bank, National Association, as Sole Lead Arranger, the terms,
covenants, conditions, provisions, stipulations and agreements of which are made
a part hereof to the same extent and with the same effect as if fully set forth
herein. The Credit Agreement, among other things, contains provisions for
acceleration of the maturity hereof upon the happening of certain stated events
and also for prepayments on account of principal hereof prior to the maturity
hereof upon the terms and conditions therein specified.
THE BORROWER HEREBY WAIVES PRESENTMENT, DEMAND, PROTEST OR NOTICE OF ANY
KIND IN CONNECTION WITH THIS NOTE.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
SUBSTANTIVE LAWS OF THE STATE OF MISSOURI WITHOUT REGARD TO PRINCIPLES OF
CONFLICT OF LAW.
89
IN WITNESS WHEREOF, the Borrower has duly executed and delivered this
Swing Line Note as of the date first written above.
ESCO TECHNOLOGIES INC.
By ___________________________________
Name: ________________________________
Title: _______________________________
90
EXHIBIT E
October ___, 2004
To the Lenders, the Administrative Agent,
and the Sole Lead Arranger
referred to below
c/o Wells Fargo Bank, National Association,
as Administrative Agent
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
MAC ▇▇▇▇▇-▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Credit Agreement dated as of October __, 2004
Ladies and Gentlemen:
We have acted as counsel for ESCO Technologies Inc., a Missouri
corporation (the "Borrower") and _____________________________(individually, a
"Guarantor Subsidiary" and collectively, the "Guarantor Subsidiaries") (the
Borrower and the Guarantor Subsidiaries are sometimes hereinafter individually
referred to as an "Obligor" and collectively referred to as the "Obligors") in
connection with that certain Credit Agreement (the "Credit Agreement") dated as
of October ________, 2004, by and among the Borrower, the financial institutions
listed on the signature pages thereof (collectively, the "Lenders"), ▇▇▇▇▇ Fargo
Bank, National Association, as Administrative Agent for the Lenders and ▇▇▇▇▇
Fargo Bank, National Association, as Sole Lead Arranger. All capitalized terms
used herein and not otherwise defined shall have the meanings assigned thereto
in the Credit Agreement. This opinion is being rendered to you at the request of
our clients pursuant to Section 3.01(e) of the Credit Agreement.
As such counsel, we have examined:
1. The Certificate or Articles of Incorporation and all amendments thereto
of each Obligor;
2. The By-Laws and all amendments thereto of each Obligor;
3. All relevant corporate minutes, resolutions and other proceedings of
each Obligor;
4. The stock records of each Guarantor Subsidiary;
5. The Credit Agreement;
6. The Revolving Credit Note of the Borrower dated the date hereof and
payable to the order of the ▇▇▇▇▇ Fargo Bank, National Association in the
principal amount of up to $______________;
91
7. The Revolving Credit Note of the Borrower dated the date hereof and
payable to the order of __________________ in the principal amount of up to
$__________;
8. The Revolving Credit Note of the Borrower dated the date hereof and
payable to the order of _____________ in the principal amount of up to
$___________;
9. The Swing Line Note of the Borrower dated the date hereof and payable
to the order of ▇▇▇▇▇ Fargo Bank, National Association in the principal amount
of up to $7,500,000.00; and
10. The Guaranty dated as of the date hereof and executed by the Guarantor
Subsidiaries in favor of the Administrative Agent, the Swing Line Lender, the
Offshore Currency Fronting Lender, the Letter of Credit Issuer and each Lender.
The documents listed in clauses (5) through (10) above are sometimes hereinafter
collectively referred to as the "Loan Documents".
We have also examined (a) originals, or copies certified or otherwise
identified to our satisfaction, of such agreements, documents, certificates,
corporate and official records, affidavits and other instruments and (b) such
laws and regulations as we deemed necessary or appropriate for purposes of this
opinion. As to factual matters, we have, in certain instances, examined and
relied upon certificates of corporate officials and certificates of public
officials, copies of which certificates, if any, are attached hereto. In such
examinations we have assumed the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
Based upon such review and upon such inquiries and investigations of the
Obligors as we deemed necessary or relevant, we are of the opinion that:
1. Each Obligor (a) is a corporation duly incorporated, validly existing
and in good standing under the laws of the state of its incorporation with
perpetual corporate existence, (b) has the corporate power and authority to own
its properties and to transact the business in which it is engaged or presently
proposes to engage and (c) is duly qualified as a foreign corporation and is in
good standing in all other states where the nature of its business or the
ownership or use of property requires such qualification and where the failure
to be so qualified or in good standing could reasonably be expected to have a
Material Adverse Effect.
2. Each Guarantor Subsidiary is a Wholly-Owned Subsidiary of the Borrower.
3. Each Obligor has full corporate right, power and authority to execute,
deliver and perform the terms and provisions of the Loan Documents to which it
is a party and has duly taken or caused to be taken all necessary corporate
actions (including, without limitation, the obtaining of any consent of
shareholders required by law or by the Certificate or Articles of Incorporation
or By-Laws of such Obligor) to authorize the execution, delivery and performance
of the Loan Documents to which it is a party.
4. The execution, delivery and performance by the Obligors of the Loan
Documents do not:
92
(a) violate any provision of any law, rule or regulation (including,
without limitation, any usury law, rule or regulation);
(b) to the best of our knowledge after due inquiry, violate any
order, writ, judgment, injunction, decree, determination or award
presently in effect which affects or binds any Obligor or any property or
assets of any Obligor;
(c) violate any provision of the Certificate or Articles of
Incorporation or By-Laws of any Obligor; or
(e) to the best of our knowledge after due inquiry, conflict with,
or result in the breach of, or constitute a default under, any other
indenture, mortgage, deed of trust, lease, contract, agreement, document
or instrument to which any Obligor is a party or by which any Obligor is
bound, or result in the creation or imposition of any lien, charge or
encumbrance upon any of the property of any Obligor thereunder.
5. Each of the Loan Documents has been duly authorized, executed and
delivered by such of the Obligors as are parties thereto, constitutes the legal,
valid and binding obligation of such of the Obligors as are parties thereto and
is enforceable against such of the Obligors as are parties thereto in accordance
with its terms (including, without limitation, the choice of law provisions
contained therein), except as such enforceability may be limited by (a)
applicable bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and (b) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
6. To the best of our knowledge after due inquiry, except as otherwise set
forth in the Loan Documents, including, without limitation, any schedules or
exhibits thereto, (a) no judgments are outstanding against the Borrower or any
of its Subsidiaries, (b) there is not now pending nor threatened against the
Borrower or any of its Subsidiaries any litigation, arbitration, contested claim
or governmental or regulatory proceeding (i) which questions the validity of any
of the Loan Documents or any of the transactions contemplated thereby or (b) in
which there is a reasonable possibility of an adverse decision which could have
a Material Adverse Effect and (c) no Obligor is in default with respect to any
order, writ, injunction or decree of any court or under any law, order,
regulation or demand of any governmental or regulatory body, instrumentality,
authority, agency or official, a default under which could reasonably be
expected to have a Material Adverse Effect.
7. No action, consent or approval of, or filing, recording or registration
with, any governmental, regulatory or public body, instrumentality, authority,
agency or official is required to authorize, or is otherwise required in
connection with, the execution, delivery and/or performance of the Loan
Documents.
8. No Obligor is an "investment company" registered or required to be
registered under the Investment Company Act of 1940, as amended, or, to our
knowledge, "controlled" by an "investment company", as such terms are defined
under the Investment Company Act of 1940, as amended.
93
9. No Obligor is a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of a "holding company" within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
Very truly yours,
94
EXHIBIT F
ASSIGNMENT AND ASSUMPTION AGREEMENT
Reference is made to that certain Credit Agreement dated as of October
___, 2004, by and among ESCO Technologies Inc., a Missouri corporation (the
"Borrower"), the financial institutions parties thereto in their capacities as
Lenders thereunder, ▇▇▇▇▇ Fargo Bank, National Association, as Administrative
Agent for the Lenders (the "Administrative Agent") and ▇▇▇▇▇ Fargo Bank,
National Association, as Sole Lead Arranger, as the same has heretofore been
amended, modified, extended, renewed, supplemented or restated (the "Credit
Agreement"). Capitalized terms used but not otherwise defined herein shall have
the respective meanings assigned to them in the Credit Agreement.
NOW, THEREFORE, ____________________________ (the "Transferor") and
____________________________ (the "Transferee") hereby agree as follows:
1. The Transferor hereby transfers and assigns to the Transferee, except
with respect to indemnities of the Borrower, if any, which have not been
satisfied and which shall have arisen prior to the Effective Date (as defined in
Section 11 hereof), that interest in and to all the Transferor's rights and
obligations under the Credit Agreement as of the date hereof which represents
the percentage interest specified in Item 2 of Schedule A to this Assignment and
Assumption Agreement ("Assigned Portion") and the Transferee hereby accepts said
assignment and, to the extent of its respective interests therein, assumes the
commitments and obligations established under the Credit Agreement with respect
to the Assigned Portion. The assignment affected hereby is without recourse
against or warranty (except as provided in Section 4 below) by the Transferor.
2. In connection with the assignment affected hereby by the Transferor to
the Transferee of the Assigned Portion with respect to the Credit Agreement:
(a) as of the Effective Date, the Transferee shall pay to the
Transferor, in immediately available funds, an amount equal to the outstanding
indebtedness owed to it by the Borrower under the Credit Agreement with respect
to the Assigned Portion;
(b) from and after the Effective Date: (i) the Transferee shall (A)
be a Lender party to the Credit Agreement for all purposes of the Credit
Agreement and the other Loan Documents, (B) be subject to the terms and
conditions thereof and (C) have all of the rights, interests, liabilities,
duties and obligations of the Transferor under the Credit Agreement, the
Revolving Credit Notes, the Letter of Credit Obligations and the Guaranty to the
extent of the Assigned Portion; and (ii) the Transferor shall to the extent
provided in this Assignment and Assumption Agreement relinquish such rights and
interest and be released from such liabilities, duties and obligations under the
Credit Agreement, the Revolving Credit Notes, the Letter of Credit Obligations
and the Guaranty as shall have been assigned to the Transferee hereunder; and
(c) from and after the Effective Date, the Administrative Agent
shall make all payments under the Credit Agreement in respect of the Assigned
Portion (including, without limitation, all payments of principal, interest and
fees, if applicable, with respect thereto) to the
95
Transferee. The Transferor and Transferee shall make all appropriate adjustments
in payments under the Credit Agreement for periods prior to the Effective Date
between themselves.
3. Each of the parties to this Assignment and Assumption Agreement agrees
that at any time and from time to time upon the written request of any other
party, it will execute and deliver such further documents and perform such
further acts as such other party may reasonably request in order to effect the
purposes of this Assignment and Assumption Agreement, provided neither this
Assignment and Assumption Agreement nor any term hereof may be changed, waived,
discharged or terminated except by an instrument in writing signed by the party
(including, if applicable, any party required to evidence its consent to or
acceptance of this Assignment and Assumption Agreement) against whom enforcement
of such change, waiver, discharge or termination is sought.
4. By executing and delivering this Assignment and Assumption Agreement,
the Transferor (a) represents and warrants that it is the legal and beneficial
owner of the interest being assigned hereby free and clear of any adverse claim;
(b) makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with the Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement, any
Revolving Credit Note, any Letter of Credit Obligation or the Guaranty, or any
other instrument or document furnished pursuant thereto; (c) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any of its Subsidiaries, or the
performance or observance by the Borrower or any of its Subsidiaries of any of
its obligations under the Credit Agreement, any Revolving Credit Note, any
Letter of Credit Obligation or the Guaranty or any other instrument or document
furnished pursuant hereto.
5. By executing and delivering this Assignment and Assumption Agreement,
the Transferee: (a) confirms that it has received a copy of the Credit
Agreement, together with copies of the financial statements referred to therein
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption Agreement; (b) will independently and without reliance upon the
Administrative Agent, the Letter of Credit Issuer, the Swing Line Lender, the
Transferor or any other Lender, and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Credit Agreement; (c) appoints and
authorizes the Administrative Agent to take such action as the Administrative
Agent, the Letter of Credit Issuer to take such action as Letter of Credit
Issuer and the Swing Line Lender to take such action as the Swing Line Lender,
on its behalf and to exercise such powers under the Credit Agreement, the
Revolving Credit Notes, the Letters of Credit and the Guaranty as are delegated
to the Administrative Agent, the Letter of Credit Issuer and the Swing Line
Lender by the terms thereof, together with such powers as are reasonably
incidental thereto; and (d) agrees that it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Agreement, the
Revolving Credit Notes, the Letter of Credit Obligations and the Guaranty are
required to be performed by it as a Lender.
6. Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by facsimile or United States mail or
courier service. For purposes hereof, the notice
96
address of each party hereto shall be as set forth on Schedule A hereto or, as
to either party, such other address as shall be designated by such party in
writing.
7. Each of the Transferor and the Transferee represents and warrants to
the Borrower and the Administrative Agent that after giving effect to the
assignment of the Assigned Portion affected hereby, each of the Transferor and
the Transferee is in compliance with the provisions of Section 9.06 of the
Credit Agreement.
8. This Assignment and Assumption Agreement may be executed in any number
of counterparts (including facsimile counterparts) and by different parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed to be an original and all of which taken together shall
constitute but one and the same instrument.
9. THIS ASSIGNMENT AND ASSUMPTION AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF MISSOURI
WITHOUT REFERENCE TO THE PROVISIONS THEREOF REGARDING CONFLICTS OF LAW.
10. No assignment effected pursuant to this Assignment and Assumption
Agreement shall constitute a novation of the obligations of the Borrower being
assigned.
11. This Assignment and Assumption Agreement shall become effective on the
date (the "Effective Date") upon which all of the following conditions are
satisfied: (i) the execution of a counterpart hereof by each of the Transferor
and the Transferee; (ii) the execution of a counterpart hereof by the Borrower
and the Administrative Agent as evidence of its consent hereto to the extent
required under Section 9.06(c) of the Credit Agreement; (iii) the receipt by the
Administrative Agent of the processing and recordation fee referred to in
Section 9.06(c) of the Credit Agreement; (iv) in the event the Transferee is not
a United States person, the delivery by the Transferee to the Administrative
Agent of such forms, certificates or other evidence with respect to United
States federal income tax withholding matters as Transferee may be required to
deliver to the Administrative Agent pursuant to Sections 2.15 and/or 9.06(c) of
the Credit Agreement; and (v) the receipt by the Administrative Agent of
originals or facsimiles of the counterparts described above and authorization of
delivery thereof; provided, however, that for all purposes under this Assignment
and Assumption Agreement, the term "Settlement Date" shall mean the later of (a)
the date specified in Item 3 of Schedule A hereto and (b) the Effective Date.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption Agreement to be executed and delivered by their respective officers
thereunto duly authorized, such execution being made as of the Effective Date in
the applicable spaces provided on Schedule A hereto.
97
SCHEDULE A
TO THE ASSIGNMENT AGREEMENT
1. NAME AND DATE OF CREDIT AGREEMENT: Credit Agreement, dated as of October ___,
2004, by and among the Borrower, the financial institutions parties thereto as
Lenders, ▇▇▇▇▇ Fargo Bank, National Association as Administrative Agent for the
Lenders and ▇▇▇▇▇ Fargo Bank, National Association, as Sole Lead Arranger, as
the same may be amended, modified, extended, renewed, supplemented or restated
from time to time.
2. Assigned Portions:
(a) Aggregate Revolving Credit
Commitments of all of the Lenders $ _________________
(b) Assigned Share ___________________%
(c) Amount of Assigned Share $ _________________
3. Settlement Date: ________________ , 20 ____
4. Payment Instructions:
TRANSFEROR: TRANSFEREE:
Attn: Attn:
Ref: Ref:
5. Notice of Address:
TRANSFEROR: TRANSFEREE:
Attn: Attn:
Ref: Ref:
- 1 -
6. SIGNATURES:
[NAME OF TRANSFEROR]
By __________________________
Name: _______________________
Title: ______________________
[NAME OF TRANSFEREE]
By __________________________
Name: _______________________
Title: ______________________
Consented to in accordance
with Section 9.06(c) of the
Credit Agreement
ESCO TECHNOLOGIES INC.
By __________________________
Name: _______________________
Title: ______________________
Accepted in accordance with
Section 9.06(c) of the Credit
Agreement
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent
By __________________________
Name: _______________________
Title: ______________________
2
EXHIBIT G
Compliance Certificate
To: ▇▇▇▇▇ Fargo Bank, National Association, as Administrative Agent
Date: _____________________, 20____
Subject: ESCO Technologies Inc.
Financial Statements
In accordance with our Credit Agreement dated as of October ___, 2004, as
amended, modified, extended, renewed, supplemented or restated (the "Credit
Agreement"), attached are the financial statements of ESCO Technologies Inc.
(the "Borrower") and its Subsidiaries of and for the [Fiscal Year] [Fiscal
Quarter] ended _______________, 20 ___ (the "Reporting Date") and the
year-to-date period then ended (the "Current Financials"). All terms used in
this certificate have the meanings given in the Credit Agreement.
The Borrower certifies that the Current Financials have been prepared in
accordance with GAAP, [subject to year-end audit adjustments and absence of
footnotes,] and fairly present in all material respects the consolidated
financial condition of the Borrower and its Subsidiaries as of the date thereof
and in a manner consistent with prior periods.
Events of Default. (Check one):
[ ] Except as previously reported in writing to the Administrative
Agent, the Borrower does not have knowledge of the occurrence of any
Default or Event of Default under the Credit Agreement.
[ ] The Borrower has knowledge of the occurrence of a Default or
Event of Default under the Credit Agreement not previously reported
in writing to the Administrative Agent and attached hereto is a
statement of the facts with respect to thereto and the action which
the Borrower is taking or purposes to take with respect thereto.
3
Subsidiaries. The Borrower further hereby certifies that as of the date hereof
it has the following Subsidiaries:
Such Subsidiary is a Material
Name of Subsidiary Jurisdiction of Organization Subsidiary (Y/N)
------------------ ---------------------------- -----------------------------
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Financial Covenants. The Borrower further hereby certifies as follows:
1. Maximum Consolidated Leverage Ratio. Pursuant to Section 5.07 of the Credit
Agreement, as of the Reporting Date, the Borrower's Consolidated Leverage Ratio
was _____ to 1.00 which [ ] satisfies [ ] does not satisfy the requirement that
such ratio be no more than 2.75 to 1.00 on the Reporting Date.
2. Minimum EBITDA. Pursuant to Section 5.08 of the Credit Agreement, as of the
Reporting Date, Borrower's EBITDA was $________ which [ ] satisfies [ ] does not
satisfy the requirement that such EBITDA be at least $_________.
3. Minimum Consolidated Net Worth. Pursuant to Section 5.09 of the Credit
Agreement, as of the Reporting Date, the Borrower's Consolidated Net Worth was
$____________ which [ ] satisfies [ ] does not satisfy the requirement that such
amount be not less than $_______________.
Attached hereto are all relevant facts in reasonable detail to evidence, and the
computations of the financial covenants referred to above. These computations
were made in accordance with GAAP.
ESCO TECHNOLOGIES INC.
By ______________________________
Name: ___________________________
Title: __________________________
4
EXHIBIT H
FORM OF BORROWING SUBSIDIARY SUPPLEMENT
__________, _________
To the Administrative Agent and Lenders party to the
Credit Agreement referred
to below
Ladies and Gentlemen:
Reference is made to the Credit Agreement date as of October __, 2004
initially among ESCO Technologies Inc., the Lenders from time to time parties
thereto, and ▇▇▇▇▇ Fargo Bank, National Association, as Offshore Currency
Fronting Lender, Letter of Credit Issuer, Swing Line Lender and as
Administrative Agent for the Lenders (the "Credit Agreement"). Terms not
otherwise defined herein are used as defined in the Credit Agreement.
The undersigned, ___________________________, a __________________
[corporation] (the "Subsidiary"), wishes to become a "Borrowing Subsidiary"
under the Credit Agreement, and accordingly hereby agrees that from the date
hereof it shall become a "Borrowing Subsidiary" under the Credit Agreement and
agrees that from the date hereof and until the payment in full of the principal
of and interest on all Loans made to it under the Credit Agreement and
performance of all of its other obligations thereunder, and termination
hereunder of its status as a "Borrowing Subsidiary" as provided below, it shall
perform, comply with and be bound by each of the provisions of the Credit
Agreement which are stated to apply to a "Borrower" or a "Borrowing Subsidiary."
Without limiting the generality of the foregoing, the Subsidiary hereby affirms
the jurisdictional and other provisions of Section 9.12 of the Credit Agreement
and acknowledges that it has heretofore received a true and correct copy of the
Credit Agreement (including any modifications thereof or supplements or waivers
thereto) as in effect on the date hereof. In addition, the Subsidiary hereby
authorizes the Borrower to act on its behalf in connection with the selection of
types and Interest Periods for Loans and the conversion and continuation of
Loans.
So long as the principal of and interest on all Loans made to the
Subsidiary under the Credit Agreement shall have been paid in full and all other
obligations of the Subsidiary under the Credit Agreement shall have been fully
performed, the Borrower may by not less than five Business Days' prior notice to
the Lenders terminate the Subsidiary's status as a "Borrowing Subsidiary."
The Subsidiary represents and warrants to the Administrative Agent and the
Lenders that:
(a) Organization and Corporate Powers. Such Subsidiary (i) is a
company duly formed and validly existing and in good standing under the
laws of the state or country of its organization (such jurisdiction being
hereinafter referred to as the "Home Country"); (ii) has the requisite
power and authority to own its property and assets and to carry on its
business substantially as now conducted except where the failure to have
such
requisite authority would not have a material adverse effect on such
Subsidiary; and (iii) has the requisite power and authority and legal
right to execute and deliver any Offshore Currency Addendum to which it is
a party and each other Loan Document to which it is a party and the
performance by it of its obligations thereunder have been duly authorized
by proper corporate proceedings.
(b) Binding Effect. Each Loan Document, including, without
limitation, any Offshore Currency Addendum, executed by such Subsidiary is
the legal, valid and binding obligations of such Subsidiary enforceable in
accordance with their respective terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and general equitable
principles.
(c) No Conflict; Government Consent. Neither the execution and
delivery by such Subsidiary of the Loan Documents to which it is a party,
nor the consummation by it of the transactions therein contemplated to be
consummated by it, nor compliance by such Subsidiary with the provisions
thereof will violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on such Subsidiary or any of its
Subsidiaries or such Subsidiary's or any of its Subsidiaries' memoranda or
articles of association of the provisions of any indenture, instrument or
agreement to which such Subsidiary or any of its Subsidiaries is a party
or is subject, or by which it, or its property, is bound, or conflict with
or constitute a default thereunder, or result in the creation or
imposition of any lien in, of or on the property of such Subsidiary or any
of its Subsidiaries pursuant to the terms of any such indenture,
instrument or agreement in any such case which violation, conflict,
default, creation or imposition could reasonably be expected to have a
material adverse effect on such Subsidiary. No order, consent, approval,
license, authorization, or validation of, or filing, recording or
registration with, or exemption by, any governmental agency is required to
authorize, or is required in connection with the execution, delivery and
performance of, or the legality, validity, binding effect or
enforceability of, any of the Loan Documents.
(d) Filing. To ensure the enforceability or admissibility in
evidence of this Agreement and each Loan Document to which such Subsidiary
is a party (including without limitation, any Offshore Currency Addendum)
in its Home Country, it is not necessary that this Agreement or any other
Loan Document to which such Subsidiary is a party or any other document be
filed or recorded with any court or other authority in its Home Country or
that any stamp or similar tax be paid to or in respect of this Agreement
or any other Loan Document of such Subsidiary. The qualification by any
Lender or the Administrative Agent for admission to do business under the
laws of such Subsidiary's Home Country does not constitute a condition to,
and the failure to so qualify does not affect, the exercise by any Lender
or the Administrative Agent of any right, privilege, or remedy afforded to
any Lender or the Administrative Agent in connection with the Loan
Documents to which such Subsidiary is a party or the enforcement of any
such right, privilege, or remedy against such Subsidiary. The performance
by any Lender or the Administrative Agent of any action required or
permitted under the Loan Documents will not (i) violate any law or
regulation of such Subsidiary's Home Country or any political subdivision
thereof, (ii) result in any tax or other monetary liability to such party
pursuant to the laws of such Subsidiary's Home Country or political
subdivision or taxing authority thereof (provided that, should any such
action result in any such tax or other
- 2 -
monetary liability to the Lender or the Administrative Agent, the Borrower
and the Subsidiary hereby agree to indemnify such Lender or the
Administrative Agent, as the case may be, against (x) any such tax or
other monetary liability and (y) any increase in any tax or other monetary
liability which results from such action by such Lender or the
Administrative Agent and, to the extent the Borrower and the Subsidiary
make such indemnification, the incurrence of such liability by the
Administrative Agent or any Lender will not constitute a Default) or (iii)
violate any rule or regulation of any federation or organization or
similar entity of which the such Subsidiary's Home Country is a member.
(e) No Immunity. Neither such Subsidiary nor any of its assets is
entitled to immunity from suit, execution, attachment or other legal
process. Such Subsidiary's execution and delivery of the Loan Documents to
which it is a party constitute, and the exercise of its rights and
performance of and compliance with its obligations under such Loan
Documents will constitute, private and commercial acts done and performed
for private and commercial purposes.
By its execution of this Borrowing Subsidiary Supplement, the Borrower
hereby absolutely and unconditionally guarantees to each Lender, the Offshore
Currency Fronting Lender and the Administrative Agent the prompt and complete
payment when due in accordance with their respective terms (whether by reason of
demand, maturity, acceleration or otherwise) of any and all of the Obligations
incurred by the Subsidiary (whether heretofore, now or hereafter made, incurred
or created, whether voluntary or involuntary and however arising, absolute or
contingent, liquidated or unliquidated, determined or undetermined, whether the
Subsidiary may be liable individually or jointly with others and whether
recovery upon such Obligations may be or hereafter becomes unenforceable). In
addition, the Borrower shall and agrees to be liable to each Lender, the
Offshore Currency Fronting Lender and the Administrative Agent for all costs and
expenses incurred by such Person in attempting or effecting collection under
this Guaranty (whether or not litigation shall be commenced in aid thereof) and
in connection with representation of such Person in connection with bankruptcy
or insolvency proceedings relating to or affecting this Guaranty, including,
without limitation, reasonable attorneys' fees and expenses. This Guaranty is a
continuing guaranty and all rights, powers and remedies hereunder shall apply to
all past, present and future Obligations, including those arising under
successive transactions which shall either continue the Obligations, increase or
decrease them, or from time to time create new Obligations after all or any
prior Obligations have been satisfied, and notwithstanding the dissolution,
liquidation or bankruptcy of the Borrower or the Subsidiary or any other event
or proceeding affecting the Borrower or the Subsidiary. The obligations of
Borrower under this Guaranty shall be in addition to any obligations of Borrower
under any other guaranties of any indebtedness, liabilities or obligations of
the Subsidiary or any other Persons heretofore, now or hereafter given to any
Lender, the Swing Line Lender, the Letter of Credit Issuer, the Offshore
Currency Fronting Lender and/or the Administrative Agent unless said other
guaranties are expressly modified or revoked in writing; and this Guaranty shall
not affect or invalidate any such other guaranties. The liability of Borrower
under this Guaranty shall be reinstated and revived and the rights of each
Lender, the Offshore Currency Fronting Lender and the Administrative Agent shall
continue if and to the extent for any reason any amount at any time paid on
account of any of the Obligations is rescinded or must otherwise be restored by
any Lender, the Offshore Currency Fronting Lender and/or the Administrative
Agent, whether as a result of any proceedings in bankruptcy or reorganization or
otherwise, all as
- 3 -
though such amount had not been paid. The determination as to whether any amount
so paid must be rescinded or restored shall be made by the applicable Lender,
the Offshore Currency Fronting Lender and/or the Administrative Agent, as the
case may be, in its sole discretion; provided however, that if the applicable
Lender, the Offshore Currency Fronting Lender and/or the Administrative Agent,
as the case may be, chooses to contest any such matter at the request of
Borrower, the Borrower agrees to indemnify and hold such Lender, Offshore
Currency Fronting Lender and/or the Administrative Agent, as the case may be,
harmless from and against all costs and expenses, including reasonable
attorneys' fees, expended or incurred by such Person in connection therewith,
including without limitation, in any litigation with respect thereto. The
Borrower authorizes each Lender, the Offshore Currency Fronting Lender and the
Administrative Agent, without notice to or demand on Borrower, and without
affecting Borrower's liability under this Guaranty, from time to time to: (a)
alter, compromise, renew, extend, accelerate or otherwise change the time for
payment of, or otherwise change the terms of the Obligations or any portion
thereof, including increasing or decreasing of the rate of interest thereon; (b)
take and hold security for the payment of this Guaranty or of the Obligations or
any portion thereof, and exchange, enforce, waive, subordinate or release any
such security; (c) apply such security and direct the order or manner of sale
thereof, including without limitation, a non-judicial sale permitted by the
terms of the controlling security agreement, mortgage or deed of trust, as such
Person in its discretion may determine; (d) release or substitute any one or
more of the endorsers or any other guarantors of the Obligations, or any portion
thereof, or any other party thereto; and (e) apply payments received by such
Person from the Borrower or the Subsidiary to the Obligations in such manner and
order as it shall determine in its sole discretion, and the Borrower hereby
waives any provision of law regarding application of payments which specifies
otherwise. Each Lender, the Offshore Currency Fronting Lender and/or the
Administrative Agent may without notice assign its rights, obligations and/or
duties under this Guaranty in whole or in part. The Borrower waives to the
fullest extent permitted by applicable law any right to require any Lender, the
Offshore Currency Fronting Lender and/or the Administrative Agent to: (i)
proceed against the Subsidiary or any other Person; (ii) marshal assets or
proceed against or exhaust any security held from the Subsidiary or any other
person; (iii) give notice of the terms, time and place of any public or private
sale or other disposition of personal property security held from the Subsidiary
or any other Person; (iv) take any action or pursue any other remedy in such
Person's power; or (v) make any presentment or demand for performance, or give
any notice of nonperformance, protest, notice of protest or notice of dishonor
under this Guaranty or in connection with any obligations or evidences of
indebtedness held by such Person as security for or which constitute in whole or
in part the Obligations guaranteed hereunder, or in connection with the creation
of new or additional Obligations. The Borrower waives to the fullest extent
permitted by applicable law any defense to its obligations under this Guaranty
based upon or arising by reason of: (i) any disability or other defense of the
Subsidiary or any other Person; (ii) the cessation or limitation from any cause
whatsoever, other than payment in full, of the Obligations; (iii) any lack of
authority of any officer, director, partner, agent or any other Person acting or
purporting to act on behalf of the Subsidiary, or any defect in the formation of
the Subsidiary; (iv) the application by the Subsidiary of the proceeds of any of
the Obligations for purposes other than the purposes represented by the
Subsidiary to, or intended or understood by, any Lender, the Offshore Currency
Fronting Lender, the Administrative Agent and/or the Borrower; (v) any act or
omission by any Lender, the Offshore Currency Fronting Lender and/or the
Administrative Agent which directly or indirectly results in or aids the
discharge of the Subsidiary or all or any portion of the Obligations by
operation of law or otherwise, or which in any way impairs or suspends any
rights or remedies of any Lender,
- 4 -
the Offshore Currency Fronting Lender and/or the Administrative Agent against
the Subsidiary; (vi) any impairment of the value of any interest in any security
for the Obligations or any portion thereof, including without limitation, the
failure to obtain or maintain perfection or recordation of any interest in any
such security, the release of any such security without substitution and/or the
failure to preserve the value of, or to comply with applicable law in disposing
of, any such security; (vii) any modification of any or all of the Obligations,
in any form whatsoever, including any modification made after revocation hereof
to any Obligations incurred prior to such revocation, and including, without
limitation, the renewal, extension, acceleration or other change in time for
payment of, or other change in the terms of, the Obligations or any portion
thereof, including increasing or decreasing the rate of interest thereon; or
(viii) any requirement that any Lender, the Offshore Currency Fronting Lender
and/or the Administrative Agent give any notice of acceptance of this Guaranty.
The Borrower further waives all rights and defenses which the Borrower may have
arising out of (i) any election of remedies by any Lender, the Offshore Currency
Fronting Lender and/or the Administrative Agent, even though that election of
remedies, such as a non-judicial foreclosure with respect to any security for
any portion of the Obligations, destroys Borrower's rights of subrogation or
Borrower's rights to proceed against Subsidiary for reimbursement or (ii) any
loss of rights Borrower may suffer by reason of any rights, powers or remedies
of the Subsidiary in connection with any anti-deficiency laws or any other laws
limiting, qualifying or discharging the Obligations, whether by operation of law
or otherwise, including any rights which the Borrower may have to a fair market
value hearing to determine the size of a deficiency following any foreclosure
sale or other disposition of any real property security for any portion of the
Obligations. The Borrower hereby further waives any and all other suretyship
defenses.
CHOICE OF LAW. THIS BORROWING SUBSIDIARY SUPPLEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAW OF THE STATE OF MISSOURI
(WITHOUT REGARD TO THE CONFLICTS OF LAW PROVISIONS THEREOF); PROVIDED THAT THE
BORROWER, THE SUBSIDIARY, THE ADMINISTRATIVE AGENT AND THE LENDERS SHALL RETAIN
ALL RIGHTS ARISING UNDER FEDERAL LAWS.
[signature page follows]
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IN WITNESS WHEREOF, the Subsidiary has duly executed and delivered this
Borrowing Subsidiary Supplement as of the date and year first above written.
[Name of Subsidiary]
By _____________________________
Title: _________________________
Address for Notices under the
Credit Agreement:
Consented to:
ESCO TECHNOLOGIES INC.
By _____________________________
Title: _________________________
Accepted:
▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent
By _____________________________
Title: _________________________
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EXHIBIT I
FORM OF OFFSHORE CURRENCY ADDENDUM
[CURRENCY]
[CURRENCY] ADDENDUM (including the Schedules hereto, the "Addendum") dated as of
__________________, 20__ to the Credit Agreement (as defined below).
ARTICLE I
Definitions
SECTION 1.01 Defined Terms. As used in this Addendum, the following terms
shall have the meanings specified below:
"Fronted Offshore Currency Loan" shall mean any extension of credit,
denominated in the Currency made to [applicable Borrower], a
________________________ organized and existing under the laws of
___________________, pursuant to Section 2.03 of the Credit Agreement and this
Addendum. A Fronted Offshore Currency Loan shall bear interest at the rates
specified in Schedule II.
["Associated Costs Rate" means for any Fronted Offshore Currency Loan
denominated in [Currency] for any Interest Period, a percentage rate per annum,
as determined in accordance with Annex I attached hereto on the first day of
such Interest Period, determined by the Offshore Currency Fronting Lender as
reflecting the cost, loss or difference in return which would be suffered or
incurred by the Offshore Currency Fronting Lender as a results of: (a) funding
(at the Offshore Rate and on a match funded basis) any special deposit or cash
ratio deposit required to be placed with the [applicable central bank] (or any
other authority which replaces all or any of its functions) and/or (b) any
charge imposed by the [applicable Governmental Authority] (or any other
authority which replaces it or any of its functions).]
"Credit Agreement" shall mean the Amended and Restated Credit Agreement
dated as of October __, 2004 among ESCO Technologies Inc., a Missouri
corporation (the "Borrower"), the Borrowing Subsidiaries from time to time party
thereto, the financial institutions from time to time party thereto as Lenders,
and ▇▇▇▇▇ Fargo Bank, National Association, as agent for the Lenders (the
"Agent"), as the same may be amended, waived, modified or restated from time to
time.
"Currency" means [specify Alternate Currency].
SECTION 1.02 Terms Generally. Unless otherwise defined herein, terms
defined in the Credit Agreement shall have the same meanings in this Addendum.
Wherever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
All references herein to Sections and Schedules shall be deemed references to
Sections of and Schedules to this Addendum unless the context shall otherwise
require.
ARTICLE II
The Credits
SECTION 2.01 Fronted Offshore Currency Loans. (a) This Addendum (as the
same may be amended, waived, modified or restated from time to time) is an
"Offshore Currency Addendum" as defined in the Credit Agreement and is, together
with the borrowings made hereunder, subject in all respects to the terms and
provisions of the Credit Agreement except to the extent that the terms and
provisions of the Credit Agreement are modified by this Addendum. The Offshore
Currency Fronting Lender party to this Addendum is set forth on Schedule I.
(b) Any modifications to the interest payment dates, Interest Periods,
interest rates and any other special provisions applicable to Fronted Offshore
Currency Loans under this Addendum are set forth on Schedule II. If Schedule II
states "Same as Credit Agreement" with respect to any item listed thereon, then
the corresponding provisions for the Credit Agreement, without modification (but
treating Fronted Offshore Currency Loans as if they were Revolving Credit
Loans), shall govern this Addendum and the Fronted Offshore Currency Loans made
pursuant to this Addendum.
(c) Any special borrowing procedures or funding arrangements for Fronted
Offshore Currency Loans under this Addendum, any provisions for the issuance of
promissory notes to evidence the Fronted Offshore Currency Loans made hereunder
and any additional information requirements applicable to Fronted Offshore
Currency Loans under this Addendum are set forth on Schedule III. If no such
special procedures, funding arrangements, provisions or additional requirements
are set forth on Schedule III, then the corresponding procedures, funding
arrangements, provisions and information requirements set forth in the Credit
Agreement shall govern this Addendum as if expressly stated to be applicable
hereto and to the borrowings hereunder.
SECTION 2.02 Maximum Borrowing Amounts. (a) The Fronted Offshore Currency
Commitment is set forth on Schedule I.
(b) The Borrower or the applicable Borrowing Subsidiary may permanently
reduce the Fronted Offshore Currency commitment under this Addendum in whole, or
in part, in an aggregate minimum Dollar Equivalent equal to $[1,000,000] (or any
larger multiple of $[1,000,000]) upon at least one (1) Business Day's prior
written notice to the Offshore Currency Fronting Lender, which notice shall be
given not later than 11:00 a.m. (local time) and shall specify the amount of
such reductions; provided, however, that the amount of the Fronted Offshore
Currency Commitment may not be reduced below the lesser of $[10,000,000] and the
aggregate principal amount of the outstanding Fronted Offshore Currency Loans
with respect thereto.
ARTICLE III
Representations and Warranties
The Borrowing Subsidiary party hereto makes and confirms each
representation and warranty applicable to the Borrowing Subsidiary contained in
Article VI of the Credit Agreement. The Borrowing Subsidiary represents and
warrants to the Offshore Currency Fronting Lender that no Default or Event of
Default has occurred and is continuing, and no
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Default or Event of Default shall arise as a result of the making of Fronted
Offshore Currency Loans hereunder or any other transaction contemplated hereby.
ARTICLE IV
Miscellaneous Provision
SECTION 4.01 Effectiveness: Amendment; Termination. (a) This Addendum
shall not become effective until executed by the parties hereto and acknowledged
by the Agent.
(b) This Addendum may not be amended without the prior written consent of
the Offshore Currency Fronting Lender.
(c) This Addendum may not be terminated without the prior written consent
of the Offshore Currency Fronting Lender unless there are no Fronted Offshore
Currency Loans outstanding hereunder, in which case no such consent shall be
required; provided, however, that all obligations of the Offshore Currency
Fronting Lender to lend hereunder shall automatically terminate on the
Termination Date.
SECTION 4.02 Assignments. Section 9.06 of the Credit Agreement shall apply
to assignments by the Offshore Currency Fronting Lender of obligations,
commitments and Loans hereunder; provided, however, that the Offshore Currency
Fronting Lender may not assign any obligations, commitments or rights hereunder
to any Person who is not (and does not simultaneously become) a Lender under the
Credit Agreement.
SECTION 4.03 Notices. Notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:
(a) if to the Borrowing Subsidiary under this Addendum, at:
(b) if to the Offshore Currency Fronting Lender, to it at:
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
MAC ▇▇▇▇▇-▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
All notices and other communications given to any party hereto in accordance
with the provisions of this Addendum shall be deemed to have been given on the
date of receipt if delivered by hand or overnight courier service or sent by
telecopy to such party as provided in this Section or in accordance with the
latest unrevoked direction from such party given in accordance with this
Section.
SECTION 4.04 Applicable Law. THIS ADDENDUM SHALL BE GOVERNED BY AND
INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
MISSOURI. WITHOUT LIMITING THE FOREGOING, ANY DISPUTE
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BETWEEN ANY BORROWING SUBSIDIARY AND ANY AGENT, ANY LENDER, ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THEM IN CONNECTION WITH, THIS ADDENDUM OR ANY OF THE OTHER LOAN
DOCUMENTS, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE
RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICTS
OF LAWS PROVISIONS) OF THE STATE OF MISSOURI.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
duly executed by their duly authorized officers, all as of the date and year
first above written.
[applicable Borrowing Subsidiary],
as the Borrowing Subsidiary under
this Addendum
By: ______________________________
Name: ____________________________
Title: ___________________________
▇▇▇▇▇ FARGO BANK, NATIONAL
ASSOCIATION, as the Offshore
Currency Fronting Lender under
this Addendum
By: ______________________________
Name: ____________________________
Title: ___________________________
Acknowledged this ____ day
of _____________, 20__
▇▇▇▇▇ FARGO BANK, NATIONAL
ASSOCIATION, as Administrative Agent
By: ______________________________
Name: ____________________________
Title: ___________________________
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SCHEDULE II
To Offshore Currency Addendum
For [Currency]
MODIFICATIONS
1. Business Day Definition:
"Business Day" shall mean a day (other than a Saturday or Sunday on which
banks are open for business in ______.
2. Interest Payment Dates: [Same as Credit Agreement] [specify others]
3. Interest Periods: [Same as Credit Agreement] [specify others]
4. Interest Rates:
Fronted Offshore Currency Loans: Each Fronted Offshore Currency Loan
denominated in the Currency and for which an Interest Period has been selected
in accordance with the terms of Article II of the Credit Agreement and this
Addendum shall bear interest from and including the first day of the Interest
Period applicable thereto to (but not including) the last day of such Interest
Period at a rate per annum equal to the sum of (i) rate quoted by the Offshore
Currency Loan Fronting Lender for such Fronted Offshore Currency Loan for such
Interest Period plus (ii) the Associated Costs Rate for such Fronted Offshore
Currency Loan for such Interest Period; provided, however, after the occurrence
and during the continuance of a Default, each Fronted Offshore Currency Loan
shall bear interest at the rate otherwise applicable plus two percent (2%).
5. Modifications to Interest Period Selection/Conversions:
Notice of selection of Interest Period or conversion/continuation shall be
given by the Borrowing Subsidiary to the Offshore Currency Fronting Lender as
follows:
Fronted Offshore Currency Loans: _____a.m. (______ time) ___ Business Day
prior.
6. Other:
Additional Conditions Precedent: [None] [specify others]
Termination Date for Addendum: [Same as Credit Agreement] [specify earlier
date]
Maximum Number of Interest Periods: [Unlimited (provided the Borrowing
Subsidiary is in compliance with minimum borrowing amounts and increments).]
[specify other]
Prepayment Notices: The applicable Borrowing Subsidiary shall be permitted
to prepay the Fronted Offshore Currency Loans provided notice thereof is given
to the Offshore Currency Fronting Lender not later than _____a.m. (_____ time)
at least _____ (___) Business Day(s).
[Authorized Officer: In addition to the authorized officers set forth in
the Credit Agreement, those individuals designated in writing by an authorized
officer to borrow on behalf of Borrower shall also be authorized to borrow
Fronted Offshore Currency Loans hereunder.]
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SCHEDULE III
OTHER PROVISIONS
1. Borrowing Procedures:
Notice of Borrowing shall be given by the Borrowing Subsidiary to the
Offshore Currency Fronting Lender as follows:
Fronted Offshore Currency Loans: ____:00 __.m. (_______ time) [on the date
of] [____ Business Days prior to] the proposed borrowing or such other
time as the Offshore Currency Fronting Lender shall agree to.
2. Funding Arrangements:
Minimum amounts/increments for Fronted Offshore Currency Loans, repayments
and prepayments: Currency equivalent (rounded as may be prescribed by the
Offshore Currency Fronting Lender) of $___________________ or any
increment of $_________ in excess thereof.
3. Promissory Notes: [None required] [Note form to be as specified by the
Offshore Currency Fronting Lender]
4. Payments: Payments to the Offshore Currency Fronting Lender shall be made
by wire transfer of immediately available funds to its office at
_______________________.
Proceeds of Fronted Offshore Currency Loans shall be made to the Borrowing
Subsidiary by transfer to is account no. ___________________ at [Bank] or
as otherwise directed by Borrowing Subsidiary in writing.