EXHIBIT 4.1
SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF DECEMBER 27, 2001
BY AND AMONG
PACKAGED ICE, INC.,
AS BORROWER,
THE LENDERS FROM TIME TO TIME PARTY HERETO,
ABLECO FINANCE LLC,
AS COLLATERAL AGENT,
AND
ADMINISTRATIVE AGENT
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS; CERTAIN TERMS..................................................................2
Section 1.01 Definitions..........................................................................2
Section 1.02 Terms Generally.....................................................................29
Section 1.03 Accounting and Other Terms..........................................................30
Section 1.04 Time References.....................................................................30
ARTICLE II THE LOANS..................................................................................30
Section 2.01 Commitments.........................................................................30
Section 2.02 Making the Loans....................................................................31
Section 2.03 Repayment of Loans; Evidence of Debt................................................34
Section 2.04 Interest............................................................................35
Section 2.05 Reduction of Commitment; Prepayment of Loans........................................36
Section 2.06 Fees................................................................................39
Section 2.07 Securitization......................................................................41
Section 2.08 Taxes...............................................................................41
Section 2.09 LIBOR Not Determinable; Illegality or Impropriety...................................43
Section 2.10 Indemnity...........................................................................44
Section 2.11 Continuation and Conversion of Loans................................................45
ARTICLE III LETTERS OF CREDIT..........................................................................45
Section 3.01 Letter of Credit Guaranty...........................................................45
Section 3.02 Participations......................................................................47
Section 3.03 Letters of Credit...................................................................48
ARTICLE IV FEES, PAYMENTS AND OTHER COMPENSATION......................................................49
Section 4.01 Audit and Collateral Monitoring Fees................................................49
Section 4.02 Payments; Computations and Statements...............................................49
Section 4.03 Sharing of Payments, Etc............................................................50
Section 4.04 Apportionment of Payments...........................................................51
Section 4.05 Increased Costs and Reduced Return..................................................52
ARTICLE V CONDITIONS TO LOANS........................................................................54
Section 5.01 Conditions Precedent to Effectiveness...............................................54
Section 5.02 Conditions Precedent to All Loans and Letters of Credit.............................58
ARTICLE VI REPRESENTATIONS AND WARRANTIES.............................................................59
Section 6.01 Representations and Warranties......................................................59
ARTICLE VII COVENANTS..................................................................................67
Section 7.01 Affirmative Covenants...............................................................67
Section 7.02 Negative Covenants..................................................................77
Section 7.03 Financial Covenants.................................................................83
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ARTICLE VIII MANAGEMENT, COLLECTION AND STATUS OF ACCOUNTS RECEIVABLE AND OTHER
COLLATERAL.................................................................................84
Section 8.01 Collection of Accounts Receivable; Management of Collateral.........................84
Section 8.02 Accounts Receivable Documentation...................................................88
Section 8.03 Status of Accounts Receivable and Other Collateral..................................88
Section 8.04 Collateral Custodian................................................................89
ARTICLE IX EVENTS OF DEFAULT..........................................................................90
Section 9.01 Events of Default...................................................................90
ARTICLE X AGENTS.....................................................................................93
Section 10.01 Appointment.........................................................................93
Section 10.02 Nature of Duties....................................................................94
Section 10.03 Rights, Exculpation, Etc............................................................95
Section 10.04 Reliance............................................................................96
Section 10.05 Indemnification.....................................................................96
Section 10.06 Agents Individually.................................................................96
Section 10.07 Successor Agent.....................................................................96
Section 10.08 Collateral Matters..................................................................97
Section 10.09 Agency for Perfection...............................................................98
ARTICLE XI MISCELLANEOUS..............................................................................99
Section 11.01 Notices, Etc........................................................................99
Section 11.02 Amendments, Etc....................................................................100
Section 11.03 No Waiver; Remedies, Etc...........................................................100
Section 11.04 Expenses; Taxes; Attorneys' Fees...................................................101
Section 11.05 Right of Set-off...................................................................102
Section 11.06 Severability.......................................................................102
Section 11.07 Assignments and Participations.....................................................102
Section 11.08 Counterparts.......................................................................105
Section 11.09 GOVERNING LAW......................................................................105
Section 11.10 CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE..............................105
Section 11.11 WAIVER OF JURY TRIAL, ETC..........................................................106
Section 11.12 Consent by the Agents and Lenders..................................................106
Section 11.13 No Party Deemed Drafter............................................................106
Section 11.14 Reinstatement; Certain Payments....................................................106
Section 11.15 Indemnification....................................................................107
Section 11.16 Records............................................................................107
Section 11.17 Binding Effect.....................................................................108
Section 11.18 Interest...........................................................................108
Section 11.19 Confidentiality....................................................................109
Section 11.20 Integration........................................................................110
Section 11.21 No Novation........................................................................110
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SCHEDULE AND EXHIBITS
Schedule 1.01(A) Lenders and Lenders' Commitments
Schedule 1.01(B) Eligible Equipment
Schedule 1.01(C) National Accounts
Schedule 5.01(d)(iv) Mortgages
Schedule 5.01(d)(vii) Surveys
Schedule 6.01(e) Subsidiaries
Schedule 6.01(f) Litigation; Commercial Tort Claims
Schedule 6.01(i) ERISA
Schedule 6.01(o) Real Property
Schedule 6.01(q) Operating Leases
Schedule 6.01(r) Environmental Matters
Schedule 6.01(s) Insurance
Schedule 6.01(v) Bank Accounts
Schedule 6.01(w) Intellectual Property
Schedule 6.01(x) Material Contracts
Schedule 6.01(bb) Name; Jurisdiction of Organization; Organizational ID Number; Chief Place of
Business; Chief Executive Office; FEIN
Schedule 6.01(cc) Tradenames
Schedule 6.01(dd) Collateral Locations
Schedule 7.02(a) Existing Liens
Schedule 7.02(b) Existing Indebtedness
Schedule 7.02(e) Existing Investments
Schedule 7.02(k) Limitations on Dividends and Other Payment Restrictions
Schedule 8.01(a) Lockbox Banks and Lockbox Accounts
[TO BE DELIVERED PURSUANT TO SECTION 8.01(a)]
Schedule 8.01(b) Depository Banks and Depository Accounts
Exhibit A Form of Guaranty
Exhibit B Form of Security Agreement
Exhibit C Form of Pledge Agreement
Exhibit D Form of Notice of Borrowing
Exhibit E Form of Borrowing Base Certificate
Exhibit F [Intentionally Omitted]
Exhibit G [Intentionally Omitted]
Exhibit H Form of Assignment and Acceptance
Exhibit I Form of Cash Collateral Agreement
Exhibit J Form of Subsidiary Note
Exhibit K Form of Direction Letter
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SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
Second Amended and Restated
Credit Agreement, dated as of
December 27, 2001, by and among Packaged Ice, Inc., a Texas corporation (the
"Borrower"), the lenders from time to time party hereto (each a "Lender" and
collectively, the "Lenders"), Ableco Finance LLC, a Delaware limited liability
company ("Ableco"), as collateral agent for the Lenders (in such capacity, the
"Collateral Agent") and as administrative agent for the Lenders (in such
capacity, the "Administrative Agent" and together with the Collateral Agent,
each an "Agent" and collectively, the "Agents").
RECITALS
WHEREAS, the Borrower, certain lenders (the "Existing
Lenders"), Antares Capital Corporation, as a co-agent for the Existing Lenders,
and Bank of America, N.A., as a co-agent and administrative agent for the
Existing Lenders (collectively, the "Existing Agents"), are parties to an
Amended and Restated
Credit Agreement, dated as of November 28, 2000, as amended
by the First Amendment and Limited Waiver thereto, dated as of February 28,
2001, the Second Amendment thereto, dated as of May 14, 2001, and the Limited
Waiver and Third Amendment thereto, dated as of November 8, 2001 (as so amended,
the "Existing
Credit Agreement"), pursuant to which the Existing Lenders agreed
to make loans and other extensions of credit to the Borrower in an amount, as of
the Effective Date, equal to the Existing Indebtedness;
WHEREAS, the Borrower has asked the Lenders to extend credit
to the Borrower on the terms and conditions set forth in this Agreement through:
(i) the purchase by the Lenders of all rights, including all Existing
Indebtedness, and the assumption by the Lenders of all obligations of the
Existing Lenders under the Existing
Credit Agreement and the assignment to the
Agents, for the benefit of the Lenders, of all rights of the Existing Agents
under the Existing
Credit Agreement and the related Loan Documents (as defined
in the Existing
Credit Agreement) in the collateral securing the Existing
Indebtedness, such Existing Indebtedness to remain outstanding from and after
the date of the purchase of the Existing Indebtedness subject to the terms and
conditions of this Agreement and (ii) the making of additional loans on and
after the date of such purchase consisting of revolving credit loans in an
aggregate principal amount not to exceed $38,000,000 at any time outstanding,
which will include a $10,000,000 subfacility for the issuance of letters of
credit;
WHEREAS, the proceeds of the loans shall be used to refinance
the Existing Indebtedness, to repurchase the Senior Notes (as hereinafter
defined), for general working capital purposes of the Borrower and its
subsidiaries and to pay fees and expenses related to this Agreement, and the
letters of credit will be used for general working capital purposes; and
WHEREAS, the Lenders are severally, and not jointly, willing
to extend such credit to the Borrower subject to the terms and conditions
hereinafter set forth.
In consideration of the premises and the covenants and
agreements contained herein, the parties hereto agree that the Existing
Credit
Agreement shall be amended and restated as follows:
ARTICLE I
DEFINITIONS; CERTAIN TERMS
Section 1.01 Definitions. As used in this Agreement, the
following terms shall have the respective meanings indicated below, such
meanings to be applicable equally to both the singular and plural forms of such
terms:
"Ableco" has the meaning specified therefor in the preamble
hereto.
"Account Debtor" means each debtor, customer or obligor in any
way obligated on or in connection with any Account Receivable.
"Account Receivable" means, with respect to any Person, any
and all rights of such Person to payment for goods sold and/or services
rendered, including accounts, general intangibles and any and all such rights
evidenced by chattel paper, instruments or documents, whether due or to become
due and whether or not earned by performance, and whether now or hereafter
acquired or arising in the future, and any proceeds arising therefrom or
relating thereto.
"Acquisition" means the acquisition of all of the Capital
Stock of any Person or all or substantially all of the assets of any Person.
"Action" has the meaning specified therefor in Section 11.12.
"Administrative Agent" has the meaning specified therefor in
the preamble hereto.
"Administrative Agent's Account" means (i) initially Citibank,
N.A. (
New York,
New York), ABA# ▇▇▇▇▇▇▇▇▇, Account Name: Cerberus Partners L.P.,
Account #: ▇▇▇▇▇▇▇▇, Ref.: Packaged Ice (Ableco Finance LLC) and (ii) upon the
election of the Administrative Agent another account at a bank designated by the
Administrative Agent from time to time as the account into which the Borrower
shall make all payments to the Administrative Agent for the benefit of the
Agents and the Lenders under this Agreement and the other Loan Documents.
"Affiliate" means, with respect to any Person, any other
Person that directly or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with, such Person. For purposes of
this definition, "control" of a Person means the power, directly or indirectly,
either to (i) vote 10% or more of the Capital Stock having ordinary voting power
for the election of directors of such Person or (ii) direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise. Notwithstanding anything herein to the contrary, in no event shall
any Agent or any Lender be considered an "Affiliate" of any Loan Party.
"Agent" has the meaning specified therefor in the preamble
hereto.
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"Agreement" means this Second Amended and Restated
Credit
Agreement, including all amendments, modifications and supplements and any
exhibits or schedules to any of the foregoing, and shall refer to this Second
Amended and Restated Credit Agreement as the same may be in effect at the time
such reference becomes operative.
"Amortization Waiver" has the meaning specified therefor in
Section 2.05(c)(iv).
"Amortization Waiver Fee" has the meaning specified therefore
in Section 2.06(g).
"Anniversary Fee" has the meaning specified therefor in
Section 2.06(e).
"Assignment and Acceptance" means an assignment and acceptance
entered into by an assigning Lender and an assignee, and accepted by the
Collateral Agent, in accordance with Section 11.07 hereof and substantially in
the form of Exhibit H hereto or such other form acceptable to the Collateral
Agent.
"Authorized Officer" means, with respect to any Person, the
chief executive officer, chief financial officer, president, executive vice
president or treasurer of such Person.
"Availability" means, at any time, the difference between (i)
the lesser of (A) the Borrowing Base and (B) the Total Revolving Credit
Commitment and (ii) the sum of (A) the aggregate outstanding principal amount of
all Revolving Loans and (B) all Letter of Credit Obligations.
"B of A Intercreditor Agreement" means the Subordination and
Intercreditor Agreement dated as of the date hereof by and between the
Collateral Agent and Bank of America, N.A., and acknowledged by Cassco Ice &
Cold Storage, Inc.
"B of A Swap Documents" means, collectively, the ISDA Master
Agreement, dated November 17, 2000, by and between Bank of America, N.A. and the
Borrower and the schedule thereto, the letter of confirmation, dated December 5,
2000, by and between Bank of America, N.A. and the Borrower in connection with
the interest rate swap with respect to a notional amount of $50,000,000, and the
Deed of Trust, Security Agreement, Assignment of Leases and Rents, Financing
Statement and Fixture Filing made by Cassco Ice & Cold Storage, Inc. to Lawyers
Title Realty Services, Inc., as trustee for the benefit of Bank of America,
N.A.
"Bank" means JPMorgan Chase Bank, its successors or any other
bank designated by the Administrative Agent to the Borrower from time to time.
"Bankruptcy Code" means the United States Bankruptcy Code (11
U.S.C. Section 101, et seq.), as amended, and any successor statute.
"Board" means the Board of Governors of the Federal Reserve
System of the United States.
"Borrower" has the meaning specified therefor in the preamble
hereto.
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"Borrowing Base" means, at any time, the difference between
(i) the sum of (A) 85% of the value of the Net Amount of Eligible Accounts
Receivable at such time less the amount, if any, of the Dilution Reserve plus
(B) the M&E Component and (ii) such reserves as the Administrative Agent may
deem appropriate in the exercise of its reasonable business judgment based upon
the lending practices of the Administrative Agent, consistent with the criteria
customary in the commercial finance industry generally.
"Borrowing Base Certificate" means a certificate signed by an
Authorized Officer of the Borrower and setting forth the calculation of the
Borrowing Base in compliance with Section 7.01(a)(vi), substantially in the form
of Exhibit E.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial banks in
New York City are authorized or required
to close, provided, that with respect to the borrowing, payment or continuation
of, or determination of interest rate on LIBOR Loans, Business Day shall mean
any Business Day on which dealings in Dollars may be carried on in the interbank
eurodollar markets in
New York City and London.
"Capital Expenditures" means, with respect to any Person for
any period, the sum of the aggregate of all expenditures, other than
expenditures made as the purchase price for any Permitted Acquisition, by such
Person and its Subsidiaries during such period that in accordance with GAAP are
or should be included in "property, plant and equipment" or in a similar fixed
asset account on its balance sheet, whether such expenditures are paid in cash
or financed and including all Capitalized Lease Obligations paid or payable
during such period.
"Capital Guideline" means any law, rule, regulation, policy,
guideline or directive (whether or not having the force of law and whether or
not the failure to comply therewith would be unlawful) (i) regarding capital
adequacy, capital ratios, capital requirements, the calculation of a bank's
capital or similar matters, or (ii) affecting the amount of capital required to
be obtained or maintained by any Lender, any Person controlling any Lender, or
the L/C Issuer or the manner in which any Lender, any Person controlling any
Lender, or the L/C Issuer allocates capital to any of its contingent liabilities
(including letters of credit), advances, acceptances, commitments, assets or
liabilities.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate stock, and (ii) with
respect to any Person that is not a corporation, any and all partnership,
membership or other equity interests of such Person.
"Capitalized Lease" means, with respect to any Person, any
lease of real or personal property by such Person as lessee which is required
under GAAP to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligations" means, with respect to any
Person, obligations of such Person and its Subsidiaries under Capitalized
Leases, and, for purposes hereof, the amount of any such obligation shall be the
capitalized amount thereof determined in accordance with GAAP.
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"Cash and Cash Equivalents" means all cash and any presently
existing or hereafter arising deposit account balances, certificates of deposit
or other financial instruments properly classified as cash equivalents under
GAAP.
"Cash Collateral Account" means an interest bearing account
maintained by the Borrower with the Cash Collateral Bank pursuant to the terms
of the Cash Collateral Agreement.
"Cash Collateral Agreement" means the account control
agreement among the Borrower, the Collateral Agent and the Cash Collateral Bank,
substantially in the form of Exhibit I, as the same may be amended or otherwise
modified from time to time.
"Cash Collateral Bank" means Bank of America, N.A.
"Cash Concentration Account" has the meaning specified
therefor in Section 8.01(b).
"Cash Concentration Account Agreement" has the meaning
specified therefor in Section 8.01(b).
"Cash Concentration Account Bank" has the meaning specified
therefor in Section 8.01(b).
"Change of Control" means each occurrence of any of the
following:
(a) the acquisition, directly or indirectly, by any person or
group (within the meaning of Section 13(d)(3) of the Exchange Act) of beneficial
ownership of more than 33% of the aggregate outstanding voting power of the
Capital Stock of the Borrower;
(b) during any period of two consecutive years, individuals
who at the beginning of such period constituted the board of directors of the
Borrower (together with any new directors whose election by such board of
directors or whose nomination for election by the shareholders of the Borrower
was approved by a vote of at least a majority of the directors of the Borrower
then still in office who were either directors at the beginning of such period,
or whose election or nomination for election was previously approved) cease for
any reason to constitute a majority of the board of directors of the Borrower;
(c) the Borrower shall cease to have beneficial ownership (as
defined in Rule 13d-3 under the Exchange Act) of 100% of the aggregate voting
power of the Capital Stock (other than directors' qualifying shares) of each
other Loan Party, free and clear of all Liens (other than any Liens granted
hereunder and Permitted Liens);
(d) (i) any Loan Party consolidates with or merges into
another entity or conveys, transfers or leases all or substantially all of its
property and assets to another Person, or (ii) any entity consolidates with or
merges into any Loan Party in a transaction pursuant to which the outstanding
voting Capital Stock of such Loan Party is reclassified or changed into or
exchanged for cash, securities or other property, other than any such
transaction described (A) in this clause (ii) in which either (x) in the case of
any such transaction involving the Borrower, no Person or group (within the
meaning of Section 13(d)(3) of the Exchange Act) has, directly or
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indirectly, acquired beneficial ownership of more than 33% of the aggregate
outstanding voting Capital Stock of the Borrower or (B) in the case of any such
transaction involving a Loan Party other than the Borrower, the Borrower has
beneficial ownership of 100% of the aggregate voting power of all Capital Stock
of the resulting, surviving or transferee entity;
(e) ▇▇▇▇▇▇▇ ▇. Brick, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ III and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ shall all cease to be involved in the day to day operations
and management of the business of the Borrower, and a successor reasonably
acceptable to the Collateral Agent is not appointed on terms reasonably
acceptable to the Collateral Agent within 90 days of such cessation of
involvement; or
(f) a "Change of Control" as defined in the Indenture;
provided, however, that, notwithstanding anything to the contrary contained in
this definition, any transactions permitted by Section 7.02(c) shall not
constitute a "Change of Control."
"Closing Fee" has the meaning specified therefor in Section
2.06(a).
"Collateral" means all of the property and assets and all
interests therein and proceeds thereof now owned or hereafter acquired by any
Person upon which a Lien is granted or purported to be granted by such Person as
security for all or any part of the Obligations.
"Collateral Agent" has the meaning specified therefor in the
preamble hereto.
"Collateral Agent Advances" has the meaning specified therefor
in Section 10.08(a).
"Collection Account" and "Collection Accounts" have the
meanings specified therefor in Section 8.01(a).
"Collections" means all cash, checks, notes, instruments, and
other items of payment (including insurance proceeds, proceeds of cash sales,
rental proceeds, and tax refunds) of the Borrower.
"Commitment Fee" has the meaning specified therefor in Section
2.06(b).
"Commitments" means, with respect to each Lender, such
Lender's Revolving Credit Commitment and Term Loan Commitment.
"Consolidated EBITDA" means, with respect to any Person for
any period, the Consolidated Net Income of such Person and its Subsidiaries for
such period including, to the extent not included in Consolidated Net Income,
the proceeds of any business interruption insurance to the extent such proceeds
constitute compensation for lost earnings, plus (i) without duplication, the sum
of the following amounts of such Person and its Subsidiaries for such period and
to the extent deducted in determining Consolidated Net Income of such Person for
such period: (A) Consolidated Net Interest Expense, (B) income tax expense, (C)
depreciation expense, (D) amortization expense, and (E) extraordinary or
non-recurring losses and other
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losses from sales of assets other than Inventory sold in the ordinary course of
business, less (ii) extraordinary or non-recurring gains and other gains from
Dispositions.
"Consolidated Net Income" means, with respect to any Person
for any period, the net income (loss) of such Person and its Subsidiaries for
such period, determined on a consolidated basis and in accordance with GAAP, but
excluding from the determination of Consolidated Net Income (without
duplication) (a) any extraordinary or non recurring gains or losses or gains or
losses from Dispositions, (b) restructuring charges, (c) effects of discontinued
operations, (d) interest income, and (e) any non-cash income resulting from any
grant of stock, stock options or other equity-based compensation.
"Consolidated Net Interest Expense" means, with respect to any
Person for any period, gross interest expense of such Person and its
Subsidiaries for such period determined on a consolidated basis and in
accordance with GAAP (including, without limitation, interest expense paid to
Affiliates of such Person), less (i) the sum of (A) interest income for such
period, (B) cash gains for such period on Hedging Agreements (to the extent not
included in interest income above and to the extent not deducted in the
calculation of gross interest expense) and (C) non-cash interest expense
associated with Hedging Agreements, plus (ii) the sum of (A) cash losses for
such period on Hedging Agreements (to the extent not included in gross interest
expense) and (B) the upfront costs or fees for such period associated with
Hedging Agreements (to the extent not included in gross interest expense), in
each case, determined on a consolidated basis and in accordance with GAAP.
"Contingent Obligation" means, with respect to any Person, any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary obligations") of
any other Person (the "primary obligor") in any manner, whether directly or
indirectly, including, without limitation, (i) the direct or indirect guaranty,
endorsement (other than for collection or deposit in the ordinary course of
business), co-making, discounting with recourse or sale with recourse by such
Person of the obligation of a primary obligor, (ii) the obligation to make
take-or-pay or similar payments, if required, regardless of nonperformance by
any other party or parties to an agreement, (iii) any obligation of such Person,
whether or not contingent, (A) to purchase any such primary obligation or any
property constituting direct or indirect security therefor, (B) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (C) to
purchase property, assets, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (D) otherwise to assure or
hold harmless the holder of such primary obligation against loss in respect
thereof; provided, however, that the term "Contingent Obligation" shall not
include any product warranties extended in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation with respect to which
such Contingent Obligation is made (or, if less, the maximum amount of such
primary obligation for which such Person may be liable pursuant to the terms of
the instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability with respect thereto
(assuming such Person is required to perform thereunder), as determined by such
Person in good faith.
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"Default" means an event which, with the giving of notice or
the lapse of time or both, would constitute an Event of Default.
"Default Rate" means a rate of interest per annum equal to the
rate of interest otherwise in effect from time to time pursuant to the terms of
this Agreement plus 3.0%, or, if a rate of interest is not otherwise in effect,
the greater of (i) Reference Rate plus 5.0% and (ii) 12.5%.
"Depository Accounts" has the meaning specified therefor in
Section 8.01(b).
"Depository Bank" has the meaning specified therefor in
Section 8.01(b).
"Dilution" means, as of any date of determination, a
percentage, based upon the experience of the immediately prior 90 days, that is
the result of dividing the Dollar amount of (a) bad debt write-downs, discounts,
advertising allowances, credits, or other dilutive items with respect to the
Accounts Receivable during such period, by (b) Borrower's Collections with
respect to Accounts Receivable during such period (excluding Extraordinary
Receipts) plus the Dollar amount of clause (a).
"Dilution Reserve" means, as of any date of determination, an
amount sufficient to reduce the advance rate against Eligible Accounts
Receivable by one percentage point for each percentage point by which Dilution
is in excess of 5%.
"Disposition" means any transaction, or series of related
transactions, pursuant to which any Person or any of its Subsidiaries sells,
assigns, transfers or otherwise disposes of any property or assets (whether now
owned or hereafter acquired) to any other Person, in each case, whether or not
the consideration therefor consists of cash, securities or other assets owned by
the acquiring Person, excluding any sales of Inventory in the ordinary course of
business on ordinary business terms and dispositions to Loan Parties permitted
pursuant to Section 7.02(c)(ii).
"Dollar," "Dollars" and the symbol "$" each means lawful money
of the United States of America.
"Early Termination Fee" means a fee equal to (i) the sum of
(A) the average Total Revolving Credit Commitment during the term of this
Agreement, and (B) the average aggregate unpaid principal amount of the Term
Loans outstanding during the term of this Agreement, multiplied by (ii) (A)
2.0%, if the Total Commitment is terminated at any time from the Effective Date
until and including the first anniversary of the Effective Date, (B) 1.0%, if
the Total Commitment is terminated at any time after the first anniversary of
the Effective Date until and including the second anniversary of the Effective
Date, and (C) 0.5%, if the Total Commitment is terminated at any time after the
second anniversary of the Effective Date until and including May 3, 2004.
"Effective Date" means the date, on or before January 15,
2002, on which all of the conditions precedent set forth in Section 5.01 are
satisfied or waived and the initial Loans are made.
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"Eligible Accounts Receivable" means the Accounts Receivable
of a Loan Party which are, and at all times continue to be, acceptable to the
Administrative Agent in the exercise of its reasonable business judgment. In
general, an Account Receivable may, in the reasonable business judgment of the
Administrative Agent, be deemed to be eligible if: (i) delivery of the
merchandise or the rendition of the services has been completed with respect to
such Account Receivable; (ii) no return, rejection, repossession or dispute has
occurred with respect to such Account Receivable, the Account Debtor has not
asserted any setoff, defense or counterclaim with respect to such Account
Receivable, and there has not occurred any extension of the time for payment
with respect to such Account Receivable that will result in such Account
Receivable failing to satisfy clause (v) below without the consent of the
Administrative Agent, provided that, in the case of any dispute, setoff, defense
or counterclaim with respect to an Account Receivable, the portion of such
Account Receivable not subject to such dispute, setoff, defense or counterclaim
will not be ineligible solely by reason of this clause (ii); (iii) such Account
Receivable is lawfully owned by a Loan Party free and clear of any Lien other
than in favor of the Collateral Agent for the benefit of the Lenders and
otherwise continues to be in full conformity with all representations and
warranties made by the Loan Parties to the Agents and the Lenders with respect
thereto in the Loan Documents; (iv) such Account Receivable is unconditionally
payable in Dollars within 90 days from the invoice date and is not evidenced by
a promissory note, chattel paper or any other instrument or other document
unless the original of such document is in the possession of the Collateral
Agent and contains all necessary endorsements in favor of the Collateral Agent;
(v) no more than 60 days have elapsed from the invoice due date and no more than
90 days have elapsed from the invoice date with respect to such Account
Receivable; (vi) such Account Receivable is not due from an Affiliate of a Loan
Party; (vii) such Account Receivable does not constitute an obligation of the
United States or any other Governmental Authority (unless all steps required by
the Administrative Agent in connection therewith, including notice to the United
States Government under the Federal Assignment of Claims Act or any action under
any state statute comparable to the Federal Assignment of Claims Act, have been
duly taken in a manner satisfactory to the Administrative Agent); (viii) the
Account Debtor (or the applicable office of the Account Debtor) with respect to
such Account Receivable is located in a state of the United States, unless such
Account Receivable is supported by a letter of credit or other similar
obligation satisfactory to the Administrative Agent; (ix) the Account Debtor
with respect to such Account Receivable is not also a supplier to or creditor of
the Borrower, unless such Account Debtor has executed a no-offset letter
reasonably satisfactory to the Administrative Agent; (x) not more than 50% of
the aggregate amount of all Accounts Receivable of the Account Debtor with
respect to such Account Receivable have remained unpaid 60 days past the invoice
due date or 90 days past the invoice date; (xi) the Account Debtor with respect
to such Account Receivable (A) has not filed a petition for bankruptcy or any
other relief under the Bankruptcy Code or any other law relating to bankruptcy,
insolvency, reorganization or relief of debtors, made an assignment for the
benefit of creditors, had filed against it any petition or other application for
relief under the Bankruptcy Code or any such other law, (B) has not failed,
suspended business operations, become insolvent or called a meeting of its
creditors for the purpose of obtaining any financial concession or
accommodation, (C) has not had or suffered to be appointed a receiver or a
trustee for all or a significant portion of its assets or affairs or (D) in the
case of an Account Debtor who is an individual, is not an employee of a Loan
Party or any of their Affiliates and has not died or been declared incompetent;
and (xii) the Administrative Agent is, and continues to be, satisfied with
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the credit standing of the Account Debtor in relation to the amount of credit
extended and the Administrative Agent believes, in its reasonable business
judgment, that the prospect of collection of such Account Receivable is not
impaired in material respect for any reason.
"Eligible Equipment" means the Ice Factories and other
Equipment owned by the Loan Parties that are used in connection with the Loan
Parties' ice manufacturing and distribution facilities and that are listed on
Schedule 1.01(B) hereto and located at one of the locations listed on Schedule
1.01(B) hereto which meets all of the following specifications: (i) the
Administrative Agent shall have received (A) the most recent appraisal of such
Ice Factories or other Equipment requested by the Administrative Agent pursuant
to the terms of this Agreement, which appraisal shall be based upon the Net
Orderly Liquidation Value of such Ice Factories or other Equipment and shall be
in form and substance and from an independent third party appraiser in each case
acceptable to the Administrative Agent in its reasonable business judgment, (B)
evidence reasonably satisfactory to the Administrative Agent that there are no
Liens on such Ice Factories or other Equipment other than Liens in favor of the
Collateral Agent for the benefit of the Lenders, and (C) evidence of property
insurance and such other information, agreements and documents with respect to
such Ice Factories or other Equipment as the Administrative Agent may reasonably
request; (ii) the Collateral Agent has a perfected first priority Lien on such
Ice Factories and other Equipment and the Collateral Agent shall be satisfied,
in its reasonable business judgment, that the Collateral Agent has the right to
dispose of such Ice Factories or other Equipment during the continuance of an
Event of Default or the Collateral Agent shall otherwise be satisfied, in its
reasonable business judgment, that it has sufficient rights to realize upon such
Ice Factories or other Equipment during the continuance of an Event of Default;
(iii) such Ice Factories and other Equipment complies with all of the
representations and warranties with respect to Equipment in the Loan Documents,
(iv) such Ice Factories are not subject to a Lease with any Person, and (v) such
Ice Factories and other Equipment are not furnishings, fixtures, parts and are
not intended to be affixed to real property other than real property
constituting Collateral and are not to become installed in or affixed to goods
other than Collateral, and are not otherwise regarded by the Administrative
Agent, in its reasonable business judgment, as unsuitable Collateral for the
Obligations and are, and at all times shall continue to be, reasonably
acceptable to the Administrative Agent in all respects, in each case as Schedule
1.01(B) may from time to time be amended by the Borrower with the prior written
consent of the Agents. Eligible Equipment shall not include obsolete items,
damaged, defective, or destroyed items.
"Employee Plan" means an employee benefit plan (other than a
Multiemployer Plan) covered by Title IV of ERISA and maintained (or that was
maintained at any time during the six (6) calendar years preceding the date of
any borrowing hereunder) for employees of any Loan Party or any of its ERISA
Affiliates.
"Environmental Actions" means any complaint, summons,
citation, notice, directive, order, claim, litigation, investigation, judicial
or administrative proceeding, judgment, or written communication from any
Governmental Authority involving violations of Environmental Laws or Releases of
Hazardous Materials (i) from any assets, properties or businesses of any Loan
Party or any of its Subsidiaries or any predecessor in interest; (ii) from
adjoining properties or businesses; or (iii) onto any facilities which received
Hazardous Materials generated by any Loan Party or any of its Subsidiaries or
any predecessor in interest.
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"Environmental Laws" means the Comprehensive Environmental
Response, Compensation and Liability Act (42 U.S.C. Section 9601, et seq.), the
Hazardous Materials Transportation Act (49 U.S.C. Section 1801, et seq.), the
Resource Conservation and Recovery Act (42 U.S.C. Section 6901, et seq.), the
Federal Clean Water Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act (42
U.S.C. Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C.
Section 2601 et seq.) and the Occupational Safety and Health Act (29 U.S.C.
Section 651 et seq.), as such laws may be amended or otherwise modified from
time to time, and any other present or future federal, state, local or foreign
statute, ordinance, rule, regulation, order, judgment, decree, permit, license
or other binding determination of any Governmental Authority imposing liability
or establishing standards of conduct for protection of the environment or other
government restrictions relating to the protection of the environment or the
Release of any Hazardous Materials into the environment.
"Environmental Liabilities and Costs" means all liabilities,
monetary obligations, Remedial Actions, losses, damages, punitive damages,
consequential damages, treble damages, costs and expenses (including all
reasonable fees, disbursements and expenses of counsel, experts and consultants
and costs of investigations and feasibility studies), fines, penalties,
sanctions and interest incurred as a result of any claim or demand by any
Governmental Authority or any third party, and which relate to any environmental
condition or a Release of Hazardous Materials from or onto (i) any property
presently or formerly owned or operated by any Loan Party or any of its
Subsidiaries or (ii) any facility which received Hazardous Materials generated
by any Loan Party or any of its Subsidiaries.
"Environmental Lien" means any Lien in favor of any
Governmental Authority for Environmental Liabilities and Costs.
"Equipment" shall mean, as to any Person, all of such Person's
present and hereafter acquired equipment (as defined in the Uniform Commercial
Code) including, without limitation, all machinery, equipment, furnishings and
fixtures, the Ice Factories, and all additions, substitutions and replacements
thereof, wherever located, together with all attachments, components, parts,
equipment and accessories installed thereon or affixed thereto and all proceeds
thereof of whatever sort.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, and regulations
thereunder, in each case, as in effect from time to time. References to sections
of ERISA shall be construed also to refer to any successor sections.
"ERISA Affiliate" means, with respect to any Person, any trade
or business (whether or not incorporated) which is a member of a group of which
such Person is a member and which would be deemed to be a "controlled group"
within the meaning of Sections 414(b), (c), (m) and (o) of the Internal Revenue
Code.
"Event of Default" means any of the events set forth in
Section 9.01.
"Excess Cash Flow" means, with respect to any Person for any
period, Consolidated EBITDA of such Person and its Subsidiaries for such period,
less the sum of
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(A) Consolidated Net Interest Expense paid by such Person and its Subsidiaries
for such period, (B) income taxes paid by such Person and its Subsidiaries for
such period, and (C) the cash portion of Capital Expenditures made by such
Person and its Subsidiaries during such period (excluding expenditures used to
acquire Ice Factories then subject to operating leases) to the extent permitted
to be made under this Agreement net of the proceeds of Dispositions and
insurance or condemnation proceeds reinvested by any Loan Party pursuant to
Section 2.05(d) hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Excluded Taxes" has the meaning specified therefore in
Section 2.08.
"Existing Agents" has the meaning specified therefor in the
recitals hereto.
"Existing Credit Agreement" has the meaning specified therefor
in the recitals hereto.
"Existing Indebtedness" means the amount due and payable by
the Borrower to the Existing Lenders under the Existing Credit Agreement on the
Effective Date in respect of principal, interest, fees and expenses which shall
not exceed $62,000,000.
"Existing Lenders" has the meaning specified therefor in the
recitals hereto.
"Extraordinary Receipts" means any cash received by the
Borrower or any of its Subsidiaries not in the ordinary course of business and
not consisting of proceeds described in Section 2.05(c)(v) or (vi), including,
without limitation, (i) foreign, United States, state or local tax refunds, (ii)
pension plan reversions, (iii) proceeds of insurance (excluding the proceeds of
any business interruption insurance to the extent such proceeds constitute
compensation for lost earnings), (iv) judgments, proceeds of settlements or
other consideration of any kind in connection with any cause of action, (v)
condemnation awards (and payments in lieu thereof), and (vi) indemnity payments.
"Facilities" means the real properties set forth in Schedule
6.01(o) including, without limitation, the land on which such facility is
located, all buildings and other improvements thereon, all fixtures located at
or used in connection with such facility, all whether now or hereafter existing.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal to, for each day during such period, the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of
New York, or, if
such rate is not so published for any day which is a Business Day, the average
of the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing
selected by it.
"Field Survey and Audit" means a field survey and audit of the
Loan Parties and an appraisal of the Collateral performed by auditors, examiners
and/or appraisers selected by the
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Collateral Agent in its reasonable business judgment, at the sole cost and
expense of the Borrower.
"Final Maturity Date" means October 31, 2004, or such earlier
date on which any Loan shall become due and payable in accordance with the terms
of this Agreement and the other Loan Documents.
"Financial Statements" means (i) the audited consolidated
balance sheet of the Borrower and its Subsidiaries for the Fiscal Year ended
December 31, 2000, and the related consolidated statement of operations,
shareholders' equity and cash flows for the Fiscal Year then ended, (ii) the
unaudited consolidated balance sheet of the Borrower and its Subsidiaries for
the twelve months ended September 30, 2001, and the related consolidated
statement of operations, shareholder's equity and cash flows for the twelve
months then ended, and (iii) the unaudited consolidated balance sheet of the
Borrower and its Subsidiaries for the month of October 2001, and the related
consolidated statement of operations, shareholder's equity and cash flows for
the month then ended.
"Fiscal Year" means the fiscal year of the Borrower and its
Subsidiaries ending on December 31 of each year.
"Fixed Charge Coverage Ratio" means, with respect to any
Person for any period, the ratio of (i) Consolidated EBITDA of such Person and
its Subsidiaries for such period minus Capital Expenditures made by such Person
and its Subsidiaries during such period (excluding expenditures used to acquire
Ice Factories then subject to operating leases) to the extent permitted to be
made under this Agreement net of the proceeds of Dispositions and insurance or
condemnation proceeds reinvested by any Loan Party pursuant to Section 2.05(d)
hereof, to (ii) the sum of (A) all principal of Indebtedness of such Person and
its Subsidiaries scheduled to be paid or prepaid during such period to the
extent there is not an equivalent permanent reduction in the commitments
thereunder, plus (B) Consolidated Net Interest Expense of such Person and its
Subsidiaries for such period, plus (C) income taxes paid or payable by such
Person and its Subsidiaries during such period (provided that for the avoidance
of doubt, income taxes payable in one period but paid in a subsequent period
shall be included in this subclause (ii)(C) in the period when payable but not
in the period when paid), plus (D) cash dividends or distributions paid by such
Person and its Subsidiaries (other than, in the case of the Borrower, dividends
or distributions paid to the Borrower) during such period.
"GAAP" means generally accepted accounting principles in
effect from time to time in the United States, applied on a consistent basis,
provided that for the purpose of Section 7.03 hereof and the definitions used
therein, "GAAP" shall mean generally accepted accounting principles in effect on
the date hereof and consistent with those used in the preparation of the
Financial Statements, provided, further, that if there occurs after the date of
this Agreement any change in GAAP that affects in any respect the calculation of
any covenant contained in Section 7.03 hereof, the Collateral Agent and the
Borrower shall negotiate in good faith amendments to the provisions of this
Agreement that relate to the calculation of such covenant with the intent of
having the respective positions of the Lenders and the Borrower after such
change in GAAP conform as nearly as possible to their respective positions as of
the date of
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this Agreement and, until any such amendments have been agreed upon, the
covenants in Section 7.03 hereof shall be calculated as if no such change in
GAAP has occurred.
"Governmental Authority" means any nation or government, any
Federal, state, city, town, municipality, county, local or other political
subdivision thereof or thereto and any department, commission, board, bureau,
instrumentality, agency or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.
"Guarantor" means (i) each of Reddy Ice, Southern Bottled
Water Company, Inc., a Nevada corporation, Cassco Ice & Cold Storage, Inc., a
Virginia corporation, and Packaged Ice IP, Inc., a Nevada corporation, and (ii)
each other Person which guarantees, pursuant to Section 7.01(b) or otherwise,
all or any part of the Obligations.
"Guaranty" means each Amended and Restated Guaranty or a
Guaranty substantially in the form of Exhibit A, made by any Guarantor in favor
of the Collateral Agent for the benefit of the Lenders pursuant to Section
7.01(b) or otherwise.
"Hazardous Materials" means (a) any element, compound or
chemical that is defined, listed or otherwise classified as a contaminant,
pollutant, toxic pollutant, toxic or hazardous substance, extremely hazardous
substance or extremely hazardous chemical, hazardous waste, special waste, or
solid waste under Environmental Laws including, without limitation, any
pollutant, contaminant, waste, hazardous waste or toxic substance which is
defined or identified in any Environmental Law and which is present in the
environment in such quantity or state that it violates any Environmental Law;
(b) petroleum and its refined products; (c) polychlorinated biphenyls; (d) any
substance exhibiting a hazardous waste characteristic, including, without
limitation, corrosivity, ignitability, toxicity or reactivity as well as any
radioactive or explosive materials; and (e) asbestos-containing materials.
"Hedging Agreement" means any interest rate, foreign currency,
commodity or equity swap, collar, cap, floor or forward rate agreement, or other
agreement or arrangement designed to protect against fluctuations in interest
rates or currency, commodity or equity values (including, without limitation,
any option with respect to any of the foregoing and any combination of the
foregoing agreements or arrangements), and any confirmation executed in
connection with any such agreement or arrangement.
"Highest Lawful Rate" means, with respect to any Agent or any
Lender, the maximum non-usurious interest rate, if any, that at any time or from
time to time may be contracted for, taken, reserved, charged or received on the
Obligations under laws applicable to such Agent or such Lender which are
currently in effect or, to the extent allowed by law, under such applicable laws
which may hereafter be in effect and which allow a higher maximum non-usurious
interest rate than applicable laws now allow.
"Ice Factories" means the automated ice producing, packaging
and storing Equipment owned by the Loan Parties.
"Indebtedness" means, with respect to any Person, without
duplication, (i) all indebtedness of such Person for borrowed money; (ii) all
obligations of such Person for the
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deferred purchase price of property or services (other than trade payables or
other accounts payable incurred in the ordinary course of such Person's business
and not outstanding for more than 90 days after the date such payable was
created); (iii) all obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments or upon which interest payments are
customarily made; (iv) all reimbursement, payment or other obligations and
liabilities of such Person created or arising under any conditional sales or
other title retention agreement with respect to property used and/or acquired by
such Person, even though the rights and remedies of the lessor, seller and/or
lender thereunder may be limited to repossession or sale of such property; (v)
all Capitalized Lease Obligations of such Person; (vi) all obligations and
liabilities, contingent or otherwise, of such Person, in respect of letters of
credit, acceptances and similar facilities; (vii) all obligations and
liabilities, calculated on a basis reasonably satisfactory to the Collateral
Agent and in accordance with accepted practice, of such Person under Hedging
Agreements; (viii) all Contingent Obligations not covered by any other clause in
this definition; (ix) liabilities incurred under Title IV of ERISA with respect
to any plan (other than a Multiemployer Plan) covered by Title IV of ERISA and
maintained for employees of such Person or any of its ERISA Affiliates; (x)
withdrawal liability incurred under ERISA by such Person or any of its ERISA
Affiliates with respect to any Multiemployer Plan; and (xi) all obligations
referred to in clauses (i) through (x) of this definition of another Person
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) a Lien upon property owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness, provided that, for purposes of this definition, the amount
of such Indebtedness shall be the fair market value of such property. The
Indebtedness of any Person shall include the Indebtedness of any partnership of
or joint venture in which such Person is a general partner or a joint venturer.
"Indemnified Matters" has the meaning specified therefor in
Section 11.15.
"Indemnitees" has the meaning specified therefor in Section
11.15.
"Indenture" means that certain Amended and Restated Indenture,
dated as of April 30, 1998, among the Borrower, as issuer, the subsidiaries of
the Borrower party thereto and the U.S. Trust Company of Texas, N.A., as
trustee, relating to the Senior Notes, as such Indenture may be amended,
restated or supplemented from time to time to the extent not prohibited
hereunder.
"Insolvency Proceeding" means any proceeding commenced by or
against any Person under any provision of the Bankruptcy Code or under any other
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, or extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.
"Interest Period" means, with respect to any LIBOR Loan, the
period commencing on the borrowing date or the date of any continuation of such
LIBOR Loan, as the case may be, and (i) in the case of the Term Loan, ending
one, two or three months thereafter and (ii) in the case of a Revolving Loan,
ending one, two, three or six months thereafter, in each case as selected by the
Borrower in the applicable notice given to the Administrative Agent pursuant to
Sections 2.02 or 2.11 hereof, provided that (i) any Interest Period that would
otherwise end on
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a day that 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, (ii) no
Interest Period for any LIBOR Loan shall end after the Final Maturity Date, and
(iii) in the case of the Term Loan, no more than three (3) Interest Periods in
the aggregate for the Borrower may exist at any one time, and in the case of the
Revolving Loans, no more than five (5) Interest Periods in the aggregate for the
Borrower may exist at any one time.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended (or any successor statute thereto) and the regulations
thereunder.
"Inventory" means, with respect to any Person, all goods and
merchandise of such Person, including, without limitation, all raw materials,
work-in-process, packaging, supplies, materials and finished goods of every
nature used or usable in connection with the shipping, storing, advertising or
sale of such goods and merchandise, whether now owned or hereafter acquired, and
all such other property the sale or other disposition of which would give rise
to an Account Receivable or cash.
"L/C Issuer" means the Bank or such other bank as the
Administrative Agent may select in its sole and absolute discretion.
"L/C Subfacility" means that portion of the Total Revolving
Credit Commitment equal to $10,000,000.
"L/C Subfacility Effective Date" means the first date on which
Letters of Credit may be issued pursuant to Article III of this Agreement, which
date shall be 45 days from the Effective Date or such earlier date as the
Administrative Agent may agree.
"Lease" means any lease of real property to which any Loan
Party or any of its Subsidiaries is a party whether as lessor or lessee.
"Lender" has the meaning specified therefor in the preamble
hereto.
"Letter of Credit" has the meaning specified therefor in
Section 3.01(a).
"Letter of Credit Application" has the meaning specified
therefor in Section 3.01(a).
"Letter of Credit Collateral Account" has the meaning
specified therefor in Section 3.01(b).
"Letter of Credit Fee" has the meaning specified therefor in
Section 3.03(b).
"Letter of Credit Guaranty" means one or more guaranties by
the Administrative Agent in favor of the L/C Issuer guaranteeing the Borrower's
obligations to the L/C Issuer under a reimbursement agreement, Letter of Credit
Application or other like document in respect of any Letter of Credit.
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"Letter of Credit Obligations" means, at any time and without
duplication, the sum of (i) the Reimbursement Obligations at such time, plus
(ii) the aggregate maximum amount available for drawing under the Letters of
Credit outstanding at such time, plus (iii) all additional amounts for which the
Administrative Agent may be liable to the L/C Issuer pursuant to any Letter of
Credit Guaranty.
"Liabilities" has the meaning specified therefor in Section
2.07.
"LIBOR" means, with respect to each day during each Interest
Period pertaining to a LIBOR Loan, the rate of interest published in The Wall
Street Journal, Eastern Edition, two Business Days prior to such Interest Period
as the "London Interbank Offered Rate" applicable to one, two or three months,
and, only in the case of a Revolving Loan, six months, as such Interest Period
shall be selected by the Borrower. In the event that The Wall Street Journal,
Eastern Edition is not published or such rate does not appear in The Wall Street
Journal, Eastern Edition, LIBOR shall be the rate determined by the
Administrative Agent to be the rate at which deposits in Dollars are offered by
the Reference Bank to first class banks in the interbank eurodollar market where
the eurodollar and foreign currency and exchange operations in respect of its
eurodollar loans are then being conducted at approximately 11:00 a.m. (
New York
City time), two Business Days prior to the beginning of such Interest Period, in
an amount approximately equal to the principal amount of the LIBOR Loan to which
such Interest Period is to apply and for a period of time comparable to such
Interest Period.
"LIBOR Loan" means a Loan bearing interest calculated based
upon LIBOR.
"Lien" means any mortgage, deed of trust, pledge, lien
(statutory or otherwise), security interest, charge or other encumbrance or
security or preferential arrangement of any nature, including, without
limitation, any conditional sale or title retention arrangement, any Capitalized
Lease and any assignment, deposit arrangement or financing lease intended as, or
having the effect of, security.
"Loan" means the Term Loan or any Revolving Loan made by an
Agent or a Lender to the Borrower pursuant to Article II hereof.
"Loan Account" means an account maintained hereunder by the
Administrative Agent on its books of account at the Payment Office, and with
respect to the Borrower, in which the Borrower will be charged with all Loans
made to, and all other Obligations incurred by, the Borrower.
"Loan Document" means this Agreement, any Guaranty, any
Security Agreement, any Pledge Agreement, any Mortgage, any Mortgage Assignment,
the Cash Collateral Agreement, any Letter of Credit Application, the B of A
Intercreditor Agreement, any UCC Filing Authorization Letter and any other
agreement, instrument, and other document executed and delivered pursuant hereto
or thereto or otherwise evidencing or securing any Loan, any Letter of Credit
Obligation or any other Obligation.
"Loan Party" means the Borrower and any Guarantor.
"Loan Servicing Fee" has the meaning specified therefor in
Section 2.06(d).
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"Local Accounts" means all Accounts Receivable of the Loan
Parties other than the National Accounts.
"Lockbox Bank" has the meaning specified therefor in Section
8.01(a).
"Lockbox Effective Date" has the meaning specified therefor in
Section 8.01(a).
"Lockboxes" has the meaning specified therefor in Section
8.01(a).
"M&E Component" means an amount equal to the sum of (i) the
least of (A) $20,000,000, (B) 80% of the Net Orderly Liquidation Value of the
Eligible Equipment of the Loan Parties, and (C) 60% of the Net Book Value of the
Eligible Equipment of the Loan Parties and (ii) from January 28th through July
31st of each year, $10,000,000.
"Material Adverse Effect" means a material adverse effect on
any of (i) the operations, business, assets, properties, condition (financial or
otherwise) or prospects of the Loan Parties taken as a whole, (ii) the ability
of the Loan Parties, taken as a whole, to perform any of their obligations under
the Loan Documents, (iii) the legality, validity or enforceability of this
Agreement or any other Loan Document (other than certificates and notices and
other non-substantive Loan Documents), (iv) the rights and remedies of any Agent
or any Lender under any Loan Document (other than certificates and notices and
other non-substantive Loan Documents), or (v) the validity, perfection or
priority of a Lien in favor of the Collateral Agent for the benefit of the
Lenders on Collateral with an aggregate fair market value equal to or greater
than $1,500,000.
"Material Contract" means, with respect to any Person, (i)
each contract or agreement to which such Person or any of its Subsidiaries is a
party involving aggregate annual consideration payable to or by such Person or
such Subsidiary of $4,000,000 or more (other than purchase orders in the
ordinary course of the business of such Person or such Subsidiary and other than
contracts that by their terms may be terminated by such Person or Subsidiary in
the ordinary course of its business upon less than 60 days' notice without
penalty or premium) and (ii) all other contracts or agreements material to the
business, operations, condition (financial or otherwise), performance, prospects
or properties of such Person or such Subsidiary, provided that the Energy
Alliance Agreement, dated May 11, 1999, by and among Enron Energy Services
Operations, Inc., the Borrower, Reddy Ice and Cassco Ice & Cold Storage, Inc., a
Virginia corporation, shall not be a Material Contract.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and any
successor thereto.
"Mortgage" means a mortgage, deed of trust, leasehold mortgage
or deed to secure debt (as any of the same may be amended, modified, and/or
restated), in form and substance reasonably satisfactory to the Collateral
Agent, made by a Loan Party in favor of the Collateral Agent for the benefit of
the Lenders, securing the Obligations and delivered to the Collateral Agent
pursuant to Section 5.01(d), Section 7.01(b), Section 7.01(o) or otherwise.
"Mortgage Assignment" means an assignment of a Mortgage, in
form and substance reasonably satisfactory to the Collateral Agent, made by Bank
of America, N.A., in
-18-
favor of the Collateral Agent for the benefit of the Lenders, securing the
Obligations and delivered to the Collateral Agent pursuant to Section 5.01(d).
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which any Loan Party or any of its ERISA
Affiliates has contributed to, or has been obligated to contribute, at any time
during the preceding six (6) years.
"National Accounts" means all Accounts Receivable of the Loan
Parties that are listed on Schedule 1.01(C) hereto and all other Accounts
Receivable due from Account Debtors that are national chains or Accounts
Receivable that are administered and collected at the corporate headquarters of
the Borrower.
"Net Amount of Eligible Accounts Receivable" means the
aggregate unpaid invoice amount of Eligible Accounts Receivable less, without
duplication, sales, excise or similar taxes, unapplied cash under 90 days,
returns, discounts, chargebacks, claims, advance payments, credits and
allowances of any nature at any time issued, owing, granted, outstanding,
available or claimed with respect to such Eligible Accounts Receivable.
"Net Book Value" means, with respect to any Eligible
Equipment, the cost of such Eligible Equipment (as reflected in the general
ledger of such Person after customary depreciation and reserves established by
such Person in good faith and in accordance with GAAP), determined in accordance
with GAAP.
"Net Cash Proceeds" means, (i) with respect to any Disposition
by any Person or any of its Subsidiaries, the amount of cash received (directly
or indirectly) from time to time (whether as initial consideration or through
the payment or disposition of deferred consideration) by or on behalf of such
Person or such Subsidiary, in connection therewith after deducting therefrom
only (A) the amount of any Indebtedness secured by any Lien permitted by Section
7.02(a) on any asset (other than Indebtedness assumed by the purchaser of such
asset) which is required to be, and is, repaid in connection with such
Disposition (other than Indebtedness under this Agreement), (B) reasonable fees,
costs and expenses related thereto incurred by such Person or such Subsidiary in
connection therewith, (C) transfer taxes paid or payable to any taxing
authorities by such Person or such Subsidiary in connection therewith, and (D)
net income taxes to be paid in connection with such Disposition (after taking
into account any tax credits or deductions and any tax sharing arrangements) and
(ii) with respect to the issuance or incurrence of any Indebtedness by any
Person or any of its Subsidiaries, or the sale or issuance by any Person or any
of its Subsidiaries of any shares of its Capital Stock, the aggregate amount of
cash received (directly or indirectly) from time to time (whether as initial
consideration or through the payment or disposition of deferred consideration)
by or on behalf of such Person or such Subsidiary in connection therewith, after
deducting therefrom only (A) reasonable fees, costs and expenses related thereto
incurred by such Person or such Subsidiary in connection therewith, (B) transfer
taxes paid or payable by such Person or such Subsidiary in connection therewith
and (C) net income taxes to be paid in connection therewith (after taking into
account any tax credits or deductions and any tax sharing arrangements); in each
case of clause (i) and (ii) to the extent, but only to the extent, that the
amounts so deducted are (x) actually paid to a Person that, except in the case
of reasonable out-of-pocket expenses, is
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not an Affiliate of such Person or any of its Subsidiaries and (y) properly
attributable to such transaction or to the asset that is the subject thereof.
"Net Orderly Liquidation Value" means, with respect to the
Eligible Equipment of the Loan Parties, as of any date of determination, the
orderly liquidation value thereof as determined by an independent third party
appraiser reasonably acceptable to the Agents, net of customary liquidation
expenses as reasonably determined by the Agents; provided that, in the absence
of a continuing Event of Default, the orderly liquidation value shall be
determined based upon an appraisal of a sample of the Eligible Equipment, such
sample to be determined by the Agents in their reasonable business judgment, and
the orderly liquidation value for all Eligible Equipment shall be extrapolated
by the Agents using any reasonable methodology from the orderly liquidation
value of such sample.
"Notice of Borrowing" has the meaning specified therefor in
Section 2.02(a).
"Obligations" means all present and future indebtedness,
obligations, and liabilities of each Loan Party to the Agents and the Lenders,
whether or not the right of payment in respect of such claim is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, disputed,
undisputed, legal, equitable, secured, unsecured, and whether or not such claim
is discharged, stayed or otherwise affected by any proceeding referred to in
Section 9.01. Without limiting the generality of the foregoing, the Obligations
of each Loan Party under the Loan Documents include (a) the obligation to pay
principal, interest, charges, expenses, fees, attorneys' fees and disbursements,
indemnities and other amounts payable by such Person under the Loan Documents,
and (b) the obligation of such Person to reimburse any amount in respect of any
of the foregoing that any Agent or any Lender (in its sole discretion) may elect
to pay or advance on behalf of such Person.
"Operating Lease Obligations" means all obligations for the
payment of rent for any real or personal property under leases or agreements to
lease, other than Capitalized Lease Obligations.
"Participant Register" has the meaning specified therefor in
Section 11.07(b)(v).
"Payment Office" means the Administrative Agent's office
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such
other office or offices of the Administrative Agent as may be designated in
writing from time to time by the Administrative Agent to the Collateral Agent
and the Borrower.
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"Permitted Acquisitions" means any Acquisition by a Loan Party
to the extent that each of the following conditions shall have been satisfied:
(a) to the extent the Acquisition will be financed in whole or
in part with the proceeds of any Loan, the conditions set forth in Section 5.02
shall have been satisfied;
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(b) the Borrower shall have furnished to the Agents at least
10 Business Days prior to the consummation of such Acquisition (i) an executed
term sheet and/or commitment letter (setting forth in reasonable detail the
terms and conditions of such Acquisition) and, at the request of any Agent, such
other information and documents that any Agent may request, including, without
limitation, executed counterparts of the respective agreements, documents or
instruments pursuant to which such Acquisition is to be consummated (including,
without limitation, any related management, non-compete, employment, option or
other material agreements), any schedules to such agreements, documents or
instruments and all other material ancillary agreements, instruments and
documents to be executed or delivered in connection therewith, (ii) pro forma
financial statements of the Borrower and its Subsidiaries after the consummation
of such Acquisition, (iii) a certificate of the chief financial officer of the
Borrower, demonstrating on a pro forma basis compliance with all covenants set
forth in Section 7.03 hereof after the consummation of such Acquisition, and
(iv) copies of such other agreements, instruments and other documents as any
Agent shall reasonably request;
(c) the agreements, instruments and other documents referred
to in paragraph (b) above shall provide that (i) neither the Loan Parties nor
any of their Subsidiaries shall, in connection with such Acquisition, assume or
remain liable in respect of any Indebtedness of the Seller or Sellers, or other
obligation of the Seller or Sellers (except for obligations incurred in the
ordinary course of business in operating the property so acquired and necessary
and desirable to the continued operation of such property and except for
Indebtedness that the Agents, with the consent of the Required Lenders,
otherwise expressly consent to in writing after their review of the terms of the
proposed Acquisition), and (ii) all property to be so acquired in connection
with such Acquisition shall be free and clear of any and all Liens, except for
Permitted Liens (and if any such property is subject to any Lien not permitted
by this clause (ii) then concurrently with such Acquisition such Lien shall be
released);
(d) the Subsidiary to be acquired or formed as a result of
such Acquisition shall (i) be engaged in the same business as the Loan Parties
and such Subsidiary will be a direct wholly-owned Subsidiary of a Loan Party,
(ii) be located in and organized under the laws of a state of the United States,
and (ii) in the case of an Acquisition, have a positive Consolidated EBITDA;
(e) such Acquisition shall be effected in such a manner so
that the acquired Capital Stock or assets are owned either by a Loan Party or a
wholly-owned Subsidiary of a Loan Party and, if effected by merger or
consolidation involving a Loan Party, such Loan Party shall be the continuing or
surviving Person;
(f) any such Subsidiary (and its equityholders) shall execute
and deliver the agreements, instruments and other documents required by Section
7.01(b) subject, in the case of any interest in real property, to Section
7.02(n);
(g) the Borrower and the other Loan Parties shall not, as a
result of or in connection with any such Acquisition, assume or incur any direct
or contingent liabilities (whether relating to environmental, tax, litigation,
or other matters) that could reasonably be expected, as of the date of such
Acquisition, to result in the existence or occurrence of a Material Adverse
Effect;
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(h) on a pro forma basis after giving effect to such
Acquisition (for the twelve month period following such Acquisition), the
Borrower shall be in compliance with Section 7.03; and
(i) the Borrower shall certify (and provide the Agents with a
pro forma calculation in form and substance reasonably satisfactory to the
Agents) to the Agents and the Lenders that, after giving effect to the
Acquisition, the Availability is not less than $10,000,000 on a pro forma basis
including all consideration given in connection with such Acquisition, other
than capital stock of the Borrower delivered to the seller(s) in such
Acquisition, as having been paid in cash at the time of making such Acquisition;
and
(j) the aggregate amount of Permitted Acquisitions with
respect to all of the Loan Parties, together with the aggregate amount of
expenditures of all Loan Parties used to acquire Ice Factories then subject to
operating leases, shall not exceed $5,000,000 in any calendar year from the
Effective Date until and including the Final Maturity Date, provided that the
purchase of assets provided for in the Reddy Asset Purchase Agreement shall not
be subject to the limitation set forth in this clause (j).
"Permitted Indebtedness" means:
(a) any Indebtedness owing to any Agent and any Lender under
this Agreement and the other Loan Documents;
(b) any Indebtedness listed on Schedule 7.02(b), and the
extension of maturity, refinancing or modification of the terms thereof;
provided, however, that (i) such extension, refinancing or modification is
pursuant to terms that are not less favorable to the Loan Parties and the
Lenders than the terms of the Indebtedness being extended, refinanced or
modified and (ii) after giving effect to such extension, refinancing or
modification, the amount of such Indebtedness is not greater than the amount of
Indebtedness outstanding immediately prior to such extension, refinancing or
modification;
(c) Indebtedness evidenced by Capitalized Lease Obligations
entered into in order to finance Capital Expenditures made by the Loan Parties
in accordance with the provisions of Section 7.02(g), which Indebtedness, when
aggregated with the principal amount of all Indebtedness incurred under this
clause (c) and clause (d) of this definition does not exceed $2,000,000 at any
time outstanding;
(d) Indebtedness permitted by clause (e) of the definition of
"Permitted Lien";
(e) guarantees of Indebtedness and other obligations, in each
case permitted under this Agreement;
(f) Indebtedness permitted under Section 7.02(e);
(g) all obligations and liabilities of the Loan Parties under
the B of A Swap Documents;
(h) Subordinated Indebtedness; and
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(i) prior to the L/C Subfacility Effective Date, reimbursement
obligations in connection with letters of credit issued by financial
institutions for the account of the Borrower, which letters of credit are
cash-collateralized.
"Permitted Investments" means (i) marketable direct
obligations issued or unconditionally guaranteed by the United States Government
or issued by any agency thereof and backed by the full faith and credit of the
United States, in each case, maturing within six months from the date of
acquisition thereof; (ii) commercial paper, maturing not more than 270 days
after the date of issue rated P-1 by Moody's or A-1 by Standard & Poor's; (iii)
certificates of deposit maturing not more than 270 days after the date of issue,
issued by commercial banking institutions and money market or demand deposit
accounts maintained at commercial banking institutions, each of which is a
member of the Federal Reserve System and has a combined capital and surplus and
undivided profits of not less than $500,000,000; (iv) repurchase agreements
having maturities of not more than 90 days from the date of acquisition which
are entered into with major money center banks included in the commercial
banking institutions described in clause (iii) above and which are secured by
readily marketable direct obligations of the United States Government or any
agency thereof, (v) money market accounts maintained with mutual funds having
assets in excess of $2,500,000,000; and (vi) tax exempt securities rated A or
better by Moody's or A+ or better by Standard & Poor's.
"Permitted Liens" means:
(a) Liens securing the Obligations;
(b) Liens for taxes, assessments and governmental charges the
payment of which is not required under Section 7.01(c);
(c) Liens imposed by law or contracts in favor of landlords',
carriers', warehousemen's, mechanics' and materialmen's and other similar Liens
arising in the ordinary course of business and securing obligations (other than
Indebtedness for borrowed money) that are not overdue by more than 30 days or
are being contested in good faith and by appropriate proceedings promptly
initiated and diligently conducted, and a reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been made therefor;
(d) Liens described on Schedule 7.02(a), but not the extension
of coverage thereof to other property other than additions and accessions to
such property, or the extension of maturity, refinancing or other modification
of the terms thereof or the increase of the Indebtedness secured thereby;
(e) (i) purchase money Liens on equipment acquired or held by
any Loan Party or any of its Subsidiaries in the ordinary course of its business
to secure the purchase price of such equipment or Indebtedness incurred solely
for the purpose of financing the acquisition of such equipment or (ii) Liens
existing on such equipment at the time of its acquisition; provided, however,
that (A) no such Lien shall extend to or cover any other property of any Loan
Party or any of its Subsidiaries other than additions and accessions to such
property, (B) the principal amount of the Indebtedness secured by any such Lien
shall not exceed the cost of the property so held or acquired and (C) the
aggregate principal amount of Indebtedness secured by any or all
-23-
such Liens plus the aggregate principal amount of Indebtedness permitted by
clause (c) of the definition of "Permitted Indebtedness" shall not exceed at any
one time outstanding $2,000,000;
(f) deposits and pledges of cash securing (i) obligations
incurred in respect of workers' compensation, unemployment insurance or other
forms of governmental insurance or benefits, (ii) the performance of bids,
tenders, leases, contracts (other than for the payment of money) and statutory
obligations or (iii) obligations on surety or appeal bonds, but only to the
extent such deposits or pledges are incurred or otherwise arise in the ordinary
course of business and secure obligations not past due;
(g) easements, zoning restrictions and similar encumbrances on
real property and minor irregularities in the title thereto that (i) are
exceptions to the commitments for title insurance issued in connection with the
Mortgages or Mortgage Assignments, (ii) do not secure obligations for the
payment of money or (iii) do not materially impair the value of such property or
its use by any Loan Party or any of its Subsidiaries in the normal conduct of
such Person's business;
(h) Liens securing Indebtedness permitted by subsection (c) of
the definition of Permitted Indebtedness;
(i) Liens resulting from judgments, decrees, orders or awards
which do not otherwise result in an Event of Default;
(j) set-offs, chargebacks and other rights of depository and
collection banks with respect to money or other instruments of any Loan Party on
deposit with or in the possession of any such banks;
(k) Liens securing the obligations under the B of A Swap
Documents;
(l) Liens in favor of the trustee under the Indenture on trust
funds under the Indenture; and
(m) prior to the L/C Subfacility Effective Date, Liens in
connection with the pledging of cash collateral for the letters of credit
described in clause (i) of the definition of Permitted Indebtedness.
"Person" means an individual, corporation, limited liability
company, partnership, association, joint-stock company, trust, unincorporated
organization, joint venture or other enterprise or entity or Governmental
Authority.
"Pledge Agreement" means an Amended and Restated Pledge
Agreement made by a Loan Party in favor of the Collateral Agent for the benefit
of the Lenders, substantially in the form of Exhibit C, securing the Obligations
and delivered to the Collateral Agent.
"Pro Rata Share" means:
(a) with respect to a Lender's obligation to make Revolving
Loans and receive payments of interest, fees, and principal with respect
thereto, the percentage obtained by dividing
-24-
(i) such Lender's Revolving Credit Commitment, by (ii) the Total Revolving
Credit Commitment, provided, that, if the Total Revolving Credit Commitment has
been reduced to zero, the numerator shall be the aggregate unpaid principal
amount of such Lender's Revolving Loans (including Collateral Agent Advances)
and its interest in the Letter of Credit Obligations and the denominator shall
be the aggregate unpaid principal amount of all Revolving Loans (including
Collateral Agent Advances) and Letter of Credit Obligations,
(b) with respect to a Lender's obligation to make the Term
Loan and receive payments of interest, fees, and principal with respect thereto,
the percentage obtained by dividing (i) such Lender's Term Loan Commitment, by
(ii) the Total Term Loan Commitment, provided that if the Total Term Loan
Commitment has been reduced to zero, the numerator shall be the aggregate unpaid
principal amount of such Lender's portion of the Term Loan and the denominator
shall be the aggregate unpaid principal amount of the Term Loan, and
(c) with respect to all other matters (including, without
limitation, the indemnification obligations arising under Section 10.05), the
percentage obtained by dividing (i) the sum of such Lender's Revolving Credit
Commitment and the unpaid principal amount of such Lender's portion of the Term
Loan, by (ii) the sum of the Total Revolving Credit Commitment and the aggregate
unpaid principal amount of the Term Loan, provided, that, if such Lender's
Revolving Credit Commitment shall have been reduced to zero, such Lender's
Revolving Credit Commitment shall be deemed to be the aggregate unpaid principal
amount of such Lender's Revolving Loans (including Collateral Agent Advances)
and its interest in the Letter of Credit Obligations and if the Total Revolving
Credit Commitment shall have been reduced to zero, the Total Revolving Credit
Commitment shall be deemed to be the aggregate unpaid principal amount of all
Revolving Loans (including Collateral Agent Advances) and Letter of Credit
Obligations.
"property" means any right or interest in or to property of
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
"Rating Agencies" has the meaning specified therefor in
Section 2.07.
"Reddy Asset Purchase Agreement" means the Asset Purchase
Agreement, dated as of December 14, 2001, by and among Desert Mountain Ice, LLC,
a California limited liability company, Mountain Water Ice Company, a California
corporation, Glacier Valley Ice Company, L.P., a California limited partnership,
South Bay Ice, LLC, a California limited liability company, Reddy Ice and the
Borrower.
"Reddy Ice" means Reddy Ice Corporation, a Nevada corporation.
"Reference Bank" means JPMorgan Chase Bank, its successors or
any other major United States commercial bank designated by the Administrative
Agent to the Borrower from time to time.
"Reference Rate" means the rate of interest publicly announced
by the Reference Bank in
New York,
New York from time to time as its reference
rate, base rate or prime rate. The reference rate, base rate or prime rate is
determined from time to time by the Reference Bank as a means of pricing some
loans to its borrowers and neither is tied to any external rate of
-25-
interest or index nor necessarily reflects the lowest rate of interest actually
charged by the Reference Bank to any particular class or category of customers.
Each change in the Reference Rate shall be effective from and including the date
such change is publicly announced as being effective.
"Reference Rate Loan" means a Loan bearing interest calculated
based upon the Reference Rate.
"Register" has the meaning specified therefor in Section
11.07(b)(ii).
"Registered Loan" has the meaning specified therefore in
Section 11.07(b)(ii).
"Regulation T", "Regulation U" and "Regulation X" mean,
respectively, Regulations T, U and X of the Board or any successor, as the same
may be amended or supplemented from time to time.
"Reimbursement Obligations" means the obligation of the
Borrower to reimburse the Administrative Agent or any Lender for amounts payable
by the Administrative Agent or any Lender under a Letter of Credit Guaranty in
respect of any drawing made under any Letter of Credit, together with interest
thereon as provided in Section 2.04.
"Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, seeping,
migrating, dumping or disposing of any Hazardous Material (including the
abandonment or discarding of barrels, containers and other closed receptacles
containing any Hazardous Material) into the indoor or outdoor environment in
violation of Environmental Laws, including, without limitation, the movement of
Hazardous Materials through or in the ambient air, soil, surface or ground
water, or property.
"Remedial Action" means all actions taken to (i) clean up,
remove, remediate, contain, treat, monitor, assess, evaluate or in any other way
address Hazardous Materials in the indoor or outdoor environment; (ii) prevent
or minimize a Release or threatened Release of Hazardous Materials so they do
not migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment; (iii) perform pre-remedial studies and
investigations and post-remedial operation and maintenance activities; or (iv)
any other actions authorized by 42 U.S.C. Section 9601.
"Reportable Event" means an event described in Section 4043 of
ERISA (other than an event not subject to the provision for 30-day notice to the
PBGC under the regulations promulgated under such Section).
"Required Lenders" means Lenders whose Pro Rata Shares of the
Term Loan aggregate at least 51%.
"Revolving Credit Commitment" means, with respect to each
Lender, the commitment of such Lender to make Revolving Loans to the Borrower in
the amount set forth opposite such Lender's name in Schedule 1.01(A) hereto, as
such amount may be terminated or reduced from time to time in accordance with
the terms of this Agreement.
-26-
"Revolving Loan" means a loan made by a Lender to the Borrower
pursuant to Section 2.01(a)(i).
"Revolving Loan Lender" means a Lender with a Revolving Credit
Commitment.
"Revolving Loan Obligations" means any Obligations with
respect to the Revolving Loans (including without limitation, the principal
thereof, the interest thereon, and the fees and expenses specifically related
thereto).
"SEC" means the Securities and Exchange Commission or any
other similar or successor agency of the Federal government administering the
Securities Act.
"Securities Act" means the Securities Act of 1933, as amended,
or any similar Federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in effect from time to time.
"Securitization" has the meaning specified therefor in Section
2.07.
"Securitization Parties" has the meaning specified therefor in
Section 2.07.
"Security Agreement" means an Amended and Restated Security
Agreement made by a Loan Party in favor of the Collateral Agent for the benefit
of the Lenders, substantially in the form of Exhibit B, securing the Obligations
and delivered to the Collateral Agent.
"Seller" means any Person that sells Capital Stock or other
property or assets to a Loan Party in a Permitted Acquisition.
"Senior Debt" means with respect to the Borrower and its
Subsidiaries, all secured Indebtedness of the Borrower and its Subsidiaries.
"Senior Interest" means all interest on the Senior Debt.
"Senior Notes" means the Series B 9 3/4% senior notes due
February 1, 2005 in the aggregate principal amount of $270,000,000, issued
pursuant to the Indenture.
"Settlement Period" has the meaning specified therefor in
Section 2.02(d)(i) hereof.
"Solvent" means, with respect to any Person on a particular
date, that on such date (i) the fair value of the property of such Person is not
less than the total amount of the liabilities of such Person, (ii) the present
fair salable value of the assets of such Person is not less than the amount that
will be required to pay the probable liability of such Person on its existing
debts as they become absolute and matured, (iii) such Person is able to realize
upon its assets and pay its debts and other liabilities, contingent obligations
and other commitments as they mature in the normal course of business, (iv) such
Person does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature, and (v) such Person is not engaged in business or a transaction, and is
not about to engage in
-27-
business or a transaction, for which such Person's property would constitute
unreasonably small capital.
"Standard & Poor's" means Standard & Poor's Ratings Services,
a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. and any successor thereto.
"Subordinated Indebtedness" means Indebtedness of any Loan
Party the terms of which are reasonably satisfactory to the Agents which has
been expressly subordinated in right of payment to all Indebtedness of such Loan
Party under the Loan Documents (i) by the execution and delivery of a
subordination agreement, in form and substance reasonably satisfactory to the
Agents, or (ii) otherwise on terms and conditions (including, without
limitation, subordination provisions, payment terms, interest rates, covenants,
remedies, defaults and other material terms) reasonably satisfactory to the
Agents.
"Subsidiary" means, with respect to any Person at any date,
any corporation, limited or general partnership, limited liability company,
trust, estate, association, joint venture or other business entity (i) the
accounts of which would be consolidated with those of such Person in such
Person's consolidated financial statements if such financial statements were
prepared in accordance with GAAP or (ii) of which more than 50% of (A) the
outstanding Capital Stock having (in the absence of contingencies) ordinary
voting power to elect a majority of the board of directors or other managing
body of such Person, (B) in the case of a partnership or limited liability
company, the interest in the capital or profits of such partnership or limited
liability company or (C) in the case of a trust, estate, association, joint
venture or other entity, the beneficial interest in such trust, estate,
association or other entity business is, at the time of determination, owned or
controlled directly or indirectly through one or more intermediaries, by such
Person.
"Subsidiary Note" means a promissory note made by a Subsidiary
Guarantor existing on the Effective Date in favor of the Borrower and
substantially in the form of Exhibit J hereto or such other form reasonably
acceptable to the Collateral Agent.
"Term Loan" means, collectively, the loans made by the Term
Loan Lenders to the Borrower on the Effective Date pursuant to Section
2.01(a)(ii) and shall include the portion of the Amortization Waiver Fee
capitalized pursuant to Section 2.06(g).
"Term Loan Commitment" means, with respect to each Lender, the
commitment of such Lender to make the Term Loan to the Borrower in the amount
set forth in Schedule 1.01(A) hereto, as the same may be terminated or reduced
from time to time in accordance with the terms of this Agreement.
"Term Loan Lender" means a Lender with a Term Loan Commitment.
"Term Loan Obligations" means any Obligations with respect to
the Term Loan (including without limitation, the principal thereof, the interest
thereon, and the fees and expenses specifically related thereto).
"Termination Event" means (i) a Reportable Event with respect
to any Employee Plan, (ii) any event that causes any Loan Party or any of its
ERISA Affiliates to incur liability
-28-
under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or
4212 of ERISA or Section 4971 or 4975 of the Internal Revenue Code, (iii) the
filing of a notice of intent to terminate an Employee Plan or the treatment of
an Employee Plan amendment as a termination under Section 4041 of ERISA, (iv)
the institution of proceedings by the PBGC to terminate an Employee Plan, or (v)
any other event or condition which might constitute grounds under Section 4042
of ERISA for the termination of, or the appointment of a trustee to administer,
any Employee Plan.
"Title Insurance Policy" means a mortgagee's loan policy, in
form and substance reasonably satisfactory to the Collateral Agent, together
with all endorsements made from time to time thereto, issued by or on behalf of
a title insurance company reasonably satisfactory to the Collateral Agent,
insuring the Lien created by a Mortgage in an amount and on terms satisfactory
to the Collateral Agent, delivered to the Collateral Agent.
"Total Commitment" means the sum of the Total Revolving Credit
Commitment and the Total Term Loan Commitment.
"Total Revolving Credit Commitment" means the sum of the
amounts of the Lenders' Revolving Credit Commitments.
"Total Term Loan Commitment" means the sum of the amounts of
the Lenders' Term Loan Commitments.
"UCC Filing Authorization Letter" means a letter duly executed
by each Loan Party authorizing the Collateral Agent to file appropriate
financing statements on Form UCC-1 without the signature of such Loan Party in
such office or offices as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to be
created by each Security Agreement, each Pledge Agreement and each Mortgage.
"Uniform Commercial Code" has the meaning specified therefore
in Section 1.03.
"Unused Line Fee" has the meaning specified therefor in
Section 2.06(c).
"WARN" has the meaning specified therefor in Section 6.01(z).
Section 1.02 Terms Generally. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise, (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person's successors and assigns, (c) the words "herein", "hereof" and
"hereunder", and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and
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Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement and (e) the words "asset" and "property" shall
be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities,
accounts and contract rights. References in this Agreement to "determination" by
any Agent include good faith estimates by such Agent (in the case of
quantitative determinations) and good faith beliefs by such Agent (in the case
of qualitative determinations).
Section 1.03 Accounting and Other Terms. Unless otherwise
expressly provided herein, each accounting term used herein shall have the
meaning given it under GAAP applied on a basis consistent with those used in
preparing the Financial Statements. All terms used in this Agreement which are
defined in Article 8 or Article 9 of the Uniform Commercial Code as in effect
from time to time in the State of
New York (the "Uniform Commercial Code") and
which are not otherwise defined herein shall have the same meanings herein as
set forth therein; provided that terms used herein which are defined in the
Uniform Commercial Code as in effect in the State of
New York on the date hereof
shall continue to have the same meaning notwithstanding any replacement or
amendment of such statute except as any Agent may otherwise determine.
Section 1.04 Time References. Unless otherwise indicated
herein, all references to time of day refer to Eastern Standard Time or Eastern
daylight saving time, as in effect in New York City on such day. For purposes of
the computation of a period of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
each means "to but excluding"; provided, however, that with respect to a
computation of fees or interest payable to any Agent, any Lender or the L/C
Issuer, such period shall in any event consist of at least one full day.
ARTICLE II
THE LOANS
Section 2.01 Commitments. (a) Subject to the terms and
conditions and relying upon the representations and warranties herein set forth:
(i) each Revolving Loan Lender severally
agrees to make Revolving Loans to the Borrower at any time and from time to time
from the Effective Date to the Final Maturity Date, or until the earlier
reduction of its Revolving Credit Commitment to zero in accordance with the
terms hereof, in an aggregate principal amount of Revolving Loans at any time
outstanding not to exceed the amount of such Lender's Revolving Credit
Commitment; and
(ii) each Term Loan Lender severally agrees
to make the Term Loan to the Borrower on the Effective Date, in an aggregate
principal amount not to exceed the amount of such Lender's Term Loan Commitment.
(b) Notwithstanding the foregoing:
(i) The aggregate principal amount of
Revolving Loans outstanding at any time to the Borrower shall not exceed the
lower of (A) the difference between
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(x) the Total Revolving Credit Commitment and (y) the aggregate Letter of Credit
Obligations and (B) the difference between (x) the then current Borrowing Base
and (y) the aggregate Letter of Credit Obligations. The Revolving Credit
Commitment of each Lender shall automatically and permanently be reduced to zero
on the Final Maturity Date. Within the foregoing limits, the Borrower may
borrow, repay and reborrow, on or after the Effective Date and prior to the
Final Maturity Date, subject to the terms, provisions and limitations set forth
herein.
(ii) The aggregate principal amount of the
Term Loan made on the Effective Date shall not exceed the Total Term Loan
Commitment. Any principal amount of the Term Loan which is repaid or prepaid may
not be reborrowed. Notwithstanding the foregoing, the principal amount of the
Term Loan may be increased by the amount of any Amortization Waiver Fee
capitalized pursuant to Section 2.06(g).
(iii) The aggregate principal amount of the
Loans and Letter of Credit Obligations shall not at any time exceed (A) an
amount equal to (x) two (2) multiplied by (y) the Consolidated EBITDA of the
Borrower and its Subsidiaries for the most recently completed twelve months or
(B) the maximum principal amount of Indebtedness which, in accordance with the
Indenture, is permitted to be incurred by the Borrower.
Section 2.02 Making the Loans. (a) The Borrower shall give the
Administrative Agent prior telephonic notice (immediately confirmed in writing,
in substantially the form of Exhibit D hereto (a "Notice of Borrowing")), not
later than 12:00 noon (New York City time) on the date which is five (5)
Business Days prior to the date of the proposed Loan (or such shorter period as
the Administrative Agent is willing to accommodate from time to time, provided
that such Notice of Borrowing shall not be received by the Administrative Agent
(i) in the case of a borrowing consisting of Reference Rate Loans, later than
12:00 noon (New York City time) on the borrowing date of the proposed Loan and
(ii) in the case of a borrowing consisting of LIBOR Loans, later than 12:00 noon
(New York City time) on the date that is three Business Days prior to the
proposed borrowing). Such Notice of Borrowing shall be irrevocable and shall
specify (A) the principal amount of the proposed Loan (which, in the case of a
LIBOR Loan, must be in a minimum amount of $1,000,000 and in integral multiples
of $500,000 in excess thereof), (B) whether such Loan is requested to be a
Reference Rate Loan or a LIBOR Loan and, in the case of a LIBOR Loan, the
initial Interest Period with respect thereto, (C) in the case of Loans requested
on the Effective Date, whether such Loan is requested to be a Revolving Loan or
the Term Loan, and (D) the use of the proceeds of such proposed Loan, provided
that the proceeds must be initially transferred to Reddy Ice or another
Subsidiary Guarantor, (E) the proposed borrowing date, which must be a Business
Day, and, with respect to the Term Loan, must be the Effective Date. The
Administrative Agent and the Lenders may act without liability upon the basis of
written, telecopied or telephonic notice believed by the Administrative Agent in
good faith to be from the Borrower (or from any Authorized Officer thereof
designated in writing purportedly from the Borrower to the Administrative
Agent). The Borrower hereby waives the right to dispute the Administrative
Agent's record of the terms of any such telephonic Notice of Borrowing, in the
absence of manifest error. The Administrative Agent and each Lender shall be
entitled to rely conclusively on any Authorized Officer's authority to request a
Loan on behalf of the Borrower until the Administrative Agent receives written
notice to the contrary. The Administrative Agent and the Lenders shall have no
duty to verify the authenticity of the signature appearing on any written Notice
of Borrowing.
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(b) Each Notice of Borrowing pursuant to this Section
2.02 shall be irrevocable and the Borrower shall be bound to make a borrowing in
accordance therewith. Each Revolving Loan shall be made in a minimum amount of
(i) in the case of a LIBOR Loan, $1,000,000 and in integral multiples of
$500,000 in excess thereof, and (ii) in the case of a Reference Rate Loan,
$350,000 and in integral multiples of $50,000 in excess thereof.
(c) (i) Except as otherwise provided in this
subsection 2.02(c), all Loans under this Agreement shall be made by the Lenders
simultaneously and proportionately to their Pro Rata Shares of the Total
Revolving Credit Commitment and the Total Term Loan Commitment, as the case may
be, it being understood that no Lender shall be responsible for any default by
any other Lender in that other Lender's obligations to make a Loan requested
hereunder, nor shall the Commitment of any Lender be increased or decreased as a
result of the default by any other Lender in that other Lender's obligation to
make a Loan requested hereunder, and each Lender shall be obligated to make the
Loans required to be made by it by the terms of this Agreement regardless of the
failure by any other Lender.
(ii) Notwithstanding any other provision of
this Agreement, and in order to reduce the number of fund transfers among the
Borrower, the Agents and the Lenders, the Borrower, the Agents and the Lenders
agree that the Administrative Agent may (but shall not be obligated to), and the
Borrower and the Lenders hereby irrevocably authorize the Administrative Agent
to, fund, on behalf of the Lenders with a Revolving Credit Commitment, Revolving
Loans pursuant to Section 2.01, subject to the procedures for settlement set
forth in subsection 2.02(d); provided, however, that (a) the Administrative
Agent shall in no event fund any such Revolving Loans if the Administrative
Agent shall have received written notice from the Collateral Agent or the
Required Lenders prior to the time of the proposed Revolving Loan that one or
more of the conditions precedent contained in Section 5.02 will not be satisfied
at the time of the proposed Revolving Loan, and (b) the Administrative Agent
shall not otherwise be required to determine that, or take notice whether, the
conditions precedent in Section 5.02 have been satisfied. If either (x) the
Borrower gives a Notice of Borrowing requesting a Revolving Loan that is a LIBOR
Loan or (y) the Administrative Agent elects not to fund a requested Revolving
Loan that is a Reference Rate Loan on behalf of the Revolving Loan Lenders, then
promptly after receipt of the Notice of Borrowing requesting such Revolving
Loan, the Administrative Agent shall notify each Revolving Loan Lender of the
specifics of the requested Revolving Loan and that it will not fund the
requested Revolving Loan on behalf of the Revolving Loan Lenders. If the
Administrative Agent notifies the Revolving Loan Lenders that it will not fund a
requested Revolving Loan on behalf of such Revolving Loan Lenders, each
Revolving Loan Lender shall make its Pro Rata Share of the Revolving Loan
available to the Administrative Agent, in immediately available funds, at the
Payment Office no later than 3:00 p.m. (New York City time) (provided that the
Administrative Agent requests payment from such Revolving Loan Lender not later
than 1:00 p.m. (New York City time)) on the date of the proposed Revolving Loan.
The Administrative Agent will make the proceeds of such Revolving Loans
available to the Borrower on the day of the proposed Revolving Loan by causing
an amount, in immediately available funds, equal to the proceeds of all such
Revolving Loans received by the Administrative Agent at the Payment Office or
the amount funded by the Administrative Agent on behalf of the Revolving Loan
Lenders to be deposited in an account designated by the Borrower.
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(iii) If the Administrative Agent has
notified the Revolving Loan Lenders that the Administrative Agent, on behalf of
such Revolving Loan Lenders, will fund a particular Revolving Loan pursuant to
subsection 2.02(c)(ii), the Administrative Agent may assume that each such
Revolving Loan Lender has made such amount available to the Administrative Agent
on such day and the Administrative Agent, in its sole discretion, may, but shall
not be obligated to, cause a corresponding amount to be made available to the
Borrower on such day. If the Administrative Agent makes such corresponding
amount available to the Borrower and such corresponding amount is not in fact
made available to the Administrative Agent by any such Revolving Loan Lender,
such Revolving Loan Lender and the Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Revolving Loan Lender
together with interest thereon, for each day from the date such payment was due
until the date such amount is paid to the Administrative Agent, at the Federal
Funds Rate for three Business Days and thereafter at the rate applicable to such
Revolving Loan. During the period in which such Revolving Loan Lender has not
paid such corresponding amount to the Administrative Agent, notwithstanding
anything to the contrary contained in this Agreement or any other Loan Document,
the amount so advanced by the Administrative Agent to the Borrower shall, for
all purposes hereof, be a Revolving Loan made by the Administrative Agent for
its own account. Upon any such failure by a Revolving Loan Lender to pay the
Administrative Agent, the Administrative Agent shall promptly thereafter notify
the Borrower of such failure and the Borrower shall immediately pay such
corresponding amount to the Administrative Agent for its own account.
(iv) Nothing in this subsection 2.02(c)
shall be deemed to relieve any Revolving Loan Lender from its obligations to
fulfill its Revolving Credit Commitment hereunder or to prejudice any rights
that the Administrative Agent or the Borrower may have against any Revolving
Loan Lender as a result of any default by such Revolving Loan Lender hereunder.
(d) (i) With respect to each LIBOR Loan, on the first
and the last date of each Interest Period, and with respect to all periods for
which the Administrative Agent, on behalf of the Revolving Loan Lenders, has
funded Revolving Loans that are Reference Rate Loans pursuant to subsection
2.02(c), on Friday of each week, or if the applicable Friday is not a Business
Day, then on the following Business Day, or such shorter period as the
Administrative Agent may from time to time select (any such week or shorter
period being herein called a "Settlement Period"), the Administrative Agent
shall notify each Revolving Loan Lender of the unpaid principal amount of the
Revolving Loans outstanding as of the last day of each such Settlement Period.
In the event that such amount is greater than the unpaid principal amount of the
Revolving Loans outstanding on the last day of the Settlement Period immediately
preceding such Settlement Period (or, if there has been no preceding Settlement
Period, the amount of the Revolving Loans made on the date of such Revolving
Loan Lender's initial funding), each Revolving Loan Lender shall promptly (and
in any event not later than 2:00 p.m. (New York City time) if the Administrative
Agent requests payment from such Lender not later than 12:00 noon (New York City
time) on such day) make available to the Administrative Agent its Pro Rata Share
of the difference in immediately available funds. In the event that such amount
is less than such unpaid principal amount, the Administrative Agent shall
promptly pay over to each Revolving Loan Lender its Pro Rata Share of the
difference in immediately available funds. In addition, if the Administrative
Agent shall so request at any time when a Default or an Event
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of Default shall have occurred and be continuing, or any other event shall have
occurred as a result of which the Administrative Agent shall determine that it
is desirable to present claims against the Borrower for repayment, each
Revolving Loan Lender shall promptly remit to the Administrative Agent or, as
the case may be, the Administrative Agent shall promptly remit to each Revolving
Loan Lender, sufficient funds to adjust the interests of the Revolving Loan
Lenders in the then outstanding Revolving Loans to such an extent that, after
giving effect to such adjustment, each such Revolving Loan Lender's interest in
the then outstanding Revolving Loans will be equal to its Pro Rata Share
thereof. The obligations of the Administrative Agent and each Revolving Loan
Lender under this subsection 2.02(d) shall be absolute and unconditional. Each
Revolving Loan Lender shall only be entitled to receive interest on its Pro Rata
Share of the Revolving Loans which have been funded by such Revolving Loan
Lender.
(ii) In the event that any Revolving Loan Lender
fails to make any payment required to be made by it pursuant to subsection
2.02(d)(i), the Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Revolving Loan Lender together with
interest thereon, for each day from the date such payment was due until the date
such amount is paid to the Administrative Agent, at the Federal Funds Rate for
three Business Days and thereafter at the rate applicable to such Revolving
Loan. During the period in which such Revolving Loan Lender has not paid such
corresponding amount to the Administrative Agent, notwithstanding anything to
the contrary contained in this Agreement or any other Loan Document, the amount
so advanced by the Administrative Agent to the Borrower shall, for all purposes
hereof, be a Revolving Loan made by the Administrative Agent for its own
account. Upon any such failure by a Revolving Loan Lender to pay the
Administrative Agent, the Administrative Agent shall promptly thereafter notify
the Borrower of such failure and the Borrower shall immediately pay such
corresponding amount to the Administrative Agent for its own account. Nothing in
this subsection 2.02(d)(ii) shall be deemed to relieve any Revolving Loan Lender
from its obligation to fulfill its Revolving Credit Commitment hereunder or to
prejudice any rights that the Administrative Agent or the Borrower may have
against any Revolving Loan Lender as a result of any default by such Revolving
Loan Lender hereunder.
Section 2.03 Repayment of Loans; Evidence of Debt. (a) The
outstanding principal of all Revolving Loans shall be due and payable on the
Final Maturity Date.
(b) The outstanding principal of the Term Loan,
including all amounts of Amortization Waiver Fee capitalized pursuant to Section
2.06(g), shall be repaid in full on the earlier of (i) the termination of the
Total Revolving Credit Commitment and (ii) the Final Maturity Date.
(c) Each Lender shall maintain in accordance with its
usual practice an account or accounts evidencing the Indebtedness of the
Borrower to such Lender resulting from each Loan made by such Lender, including
the amounts of principal and interest payable and paid to such Lender from time
to time hereunder.
(d) The Administrative Agent shall maintain accounts
in which it shall record (i) the amount of each Loan made hereunder, (ii) the
amount of any principal or interest due and payable or to become due and payable
from the Borrower to each Lender hereunder and
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(iii) the amount of any sum received by the Administrative Agent hereunder for
the account of the Lenders and each Lender's share thereof.
(e) The entries made in the accounts maintained
pursuant to paragraph (c) or (d) of this Section shall be prima facie evidence
of the existence and amounts of the obligations recorded therein; provided that
the failure of any Lender or the Administrative Agent to maintain such accounts
or any error therein shall not in any manner affect the obligation of the
Borrower to repay the Loans in accordance with the terms of this Agreement.
(f) Any Lender may request that Loans made by it be
evidenced by a promissory note. In such event, the Borrower shall execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns) in
a form furnished by the Collateral Agent and reasonably acceptable to the
Borrower. Thereafter, the Loans evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section
11.07) be represented by one or more promissory notes in such form payable to
the order of the payee named therein (or, if such promissory note is a
registered note, to such payee and its registered assigns).
Section 2.04 Interest. (a) Revolving Loans. Subject to the
terms of this Agreement, at the option of the Borrower, each Revolving Loan will
be a LIBOR Loan or a Reference Rate Loan. Each Revolving Loan which is a LIBOR
Loan shall bear interest on the principal amount thereof from time to time
outstanding, from the date of such Loan until such principal amount becomes due,
at a rate per annum equal to LIBOR for the Interest Period in effect for such
Revolving Loan plus 3.5%. Each Revolving Loan which is a Reference Rate Loan
shall bear interest on the principal amount thereof from time to time
outstanding from the date of such Loan until such principal amount becomes due,
at a rate per annum equal to the Reference Rate plus 1.5%.
(b) Term Loan. Subject to the terms of this
Agreement, at the option of the Borrower, all or a portion of the Term Loan will
be a LIBOR Loan or a Reference Rate Loan. The portion of the Term Loan that is a
LIBOR Loan shall bear interest on the principal amount thereof from time to time
outstanding, from the date of the Term Loan until such principal amount becomes
due, at a rate per annum equal to the greater of (i) LIBOR for the Interest
Period in effect for such portion of the Term Loan plus 4.0% and (ii) 9.5%. The
portion of the Term Loan that is a Reference Rate Loan shall bear interest on
the principal amount thereof from time to time outstanding, from the date of the
Term Loan until such principal amount becomes due, at a rate per annum equal to
the greater of (A) the Reference Rate plus 2.0% and (B) 9.5%.
(c) Default Interest. To the extent permitted by law,
upon the occurrence and during the continuance of an Event of Default, the
principal of, and all accrued and unpaid interest on, all Loans, fees,
indemnities, outstanding Reimbursement Obligations or any other Obligations of
the Loan Parties under this Agreement and the other Loan Documents, shall bear
interest, from the date such Event of Default occurred until the date such Event
of Default is cured or waived in writing in accordance herewith, at a rate per
annum equal at all times to the Default Rate.
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(d) Interest Payment. Interest on each Loan shall be
payable monthly, in arrears, on the first day of each month, commencing on the
first day of the month following the month in which such Loan is made and at
maturity (whether upon demand, by acceleration or otherwise). Interest at the
Default Rate shall be payable on demand. The Borrower hereby authorizes the
Administrative Agent to, and the Administrative Agent may, from time to time,
charge the Loan Account pursuant to Section 4.02 with the amount of any interest
payment due hereunder.
(e) General. All interest shall be subject to the
provisions of Section 11.18 and shall be computed on the basis of a year of 360
days for the actual number of days, including the first day but excluding the
last day, elapsed.
Section 2.05 Reduction of Commitment; Prepayment of Loans.
(a) Reduction of Commitments.
(i) Revolving Credit Commitments. The Total
Revolving Credit Commitment shall terminate on the Final Maturity Date. Except
as provided in Section 2.06(h), the Borrower may, without premium or penalty,
reduce the Total Revolving Credit Commitment to an amount (which may be zero)
not less than the sum of (A) the aggregate unpaid principal amount of all
Revolving Loans then outstanding, (B) the aggregate principal amount of all
Revolving Loans not yet made as to which a Notice of Borrowing has been given by
the Borrower under Section 2.02, (C) the Letter of Credit Obligations at such
time and (D) the stated amount of all Letters of Credit not yet issued as to
which a request has been made and not withdrawn. Each such reduction shall be in
an amount which is an integral multiple of $1,000,000 (unless the Total
Revolving Credit Commitment in effect immediately prior to such reduction is
less than $1,000,000), shall be made by providing not less than five (5) days'
prior written notice to the Administrative Agent and shall be irrevocable. Once
reduced, the Total Revolving Credit Commitment may not be increased. Each such
reduction of the Total Revolving Credit Commitment shall reduce the Revolving
Credit Commitment of each Lender proportionately in accordance with its Pro Rata
Share thereof.
(ii) Term Loan. The Total Term Loan
Commitment shall terminate at 5:00 p.m. (New York City time) on the Effective
Date.
(b) Optional Prepayment.
(i) Revolving Loans. Except as provided in
Section 2.06(h), the Borrower may prepay, without premium or penalty, the
principal of any Revolving Loan, in whole or in part at any time and from time
to time.
(ii) Term Loan. Except as provided in
Section 2.06(h), the Borrower may, upon at least five (5) Business Days' prior
written notice to the Agents, prepay, without premium or penalty, the principal
of the Term Loan, in whole or in part. Each prepayment made pursuant to this
subsection (b)(ii) shall be accompanied by the payment of accrued interest to
the date of such payment on the amount prepaid.
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(c) Mandatory Prepayment.
(i) The Borrower will immediately prepay the
Revolving Loans at any time when the aggregate principal amount of all Revolving
Loans plus the outstanding amount of all Letter of Credit Obligations exceeds
the Borrowing Base, to the full extent of any such excess. On each day that any
Revolving Loans or Letter of Credit Obligations are outstanding, the Borrower
shall hereby be deemed to represent and warrant to the Agents and the Lenders
that the Borrowing Base calculated as of such day equals or exceeds the
aggregate principal amount of all Revolving Loans and Letter of Credit
Obligations outstanding on such day. If at any time after the Borrower has
complied with the first sentence of this Section 2.05(c)(i), the aggregate
Letter of Credit Obligations is greater than the then current Borrowing Base,
the Borrower shall provide cash collateral to the Administrative Agent in an
amount equal to 110% of such excess, which cash collateral shall be deposited in
the Letter of Credit Collateral Account and, provided that no Event of Default
shall have occurred and be continuing, returned to the Borrower, at such time as
the aggregate Letter of Credit Obligations plus the aggregate principal amount
of all outstanding Revolving Loans no longer exceeds the then current Borrowing
Base.
(ii) The Borrower will immediately prepay
the outstanding principal amount of the Term Loan in the event that the Total
Revolving Credit Commitment is terminated for any reason.
(iii) The Administrative Agent shall on each
Business Day apply all funds transferred to or deposited in the Administrative
Agent's Account, to the payment, in whole or in part, of the outstanding
principal amount of the Revolving Loans.
(iv) Within ten (10) days of delivery to the
Agents and the Lenders of audited annual financial statements pursuant to
Section 7.01(a)(ii), commencing with the delivery to the Agents and the Lenders
of the financial statements for the Fiscal Year ended December 31, 2002 or, if
such financial statements are not delivered to the Agents and the Lenders on the
date such statements are required to be delivered pursuant to Section
7.01(a)(ii), ten (10) days after the date such statements are required to be
delivered to the Agents and the Lenders pursuant to Section 7.01(a)(ii), the
Borrower shall prepay the outstanding principal amount of the Term Loan (or, if
the Term Loan has been paid in full, the Revolving Loans) in an amount equal to
(A) 65% of the Excess Cash Flow of the Borrower and its Subsidiaries for such
Fiscal Year, less (B) voluntary prepayments of the Term Loan made by the
Borrower pursuant to Section 2.05(b)(ii). Notwithstanding anything to the
contrary contained herein, the Lenders shall waive the prepayment required under
this subsection (iv) for any Fiscal Year (an "Amortization Waiver") so long as
(A) the Borrower shall have made a request in writing to the Agents that
prepayment under this subsection (iv) for such Fiscal Year be waived, (B) both
immediately before and immediately after giving effect to such Amortization
Waiver, no Default or Event of Default shall have occurred and be continuing,
and (C) the Borrower shall have paid the Amortization Waiver Fee with respect to
such Amortization Waiver to the Administrative Agent for the account of the
Lenders pursuant to Section 2.06(g).
(v) Immediately upon any Disposition by any
Loan Party or its Subsidiaries pursuant to Section 7.02(c)(ii)(C) or (D), the
Borrower shall prepay the outstanding
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principal amount of the Term Loan (or, if the Term Loan has been paid in full,
the Revolving Loans) in an amount equal to 100% of the Net Cash Proceeds
received by such Person in connection with such Disposition to the extent that
the aggregate amount of Net Cash Proceeds received by all Loan Parties and their
Subsidiaries (and not paid to the Administrative Agent as a prepayment of the
Loans pursuant to Section 2.05(d)) shall exceed $10,000,000 for all such
Dispositions in any calendar year commencing in 2002, provided that (A) this
subsection (v) shall not apply to the Disposition of the assets of the Borrower
and Reddy Ice described as the "Reddy Assets" in the Reddy Asset Purchase
Agreement, and (B) the Net Cash Proceeds from Dispositions not required to be
paid as a prepayment of Loans pursuant to this paragraph may be used to
voluntarily prepay the Loans (first to the Term Loan and second to the Revolving
Loans) or, in the absence of an Event of Default, commencing in 2002, Net Cash
Proceeds from Dispositions in an amount of up to $10,000,000 in any calendar
year may be used to purchase assets used or useful in the business of the Loan
Parties, provided such Net Cash Proceeds are deposited in the Cash Collateral
Account and used in accordance with Section 2.05(d). Nothing contained in this
subsection (v) shall permit any Loan Party or any of its Subsidiaries to make a
Disposition of any property other than in accordance with Section 7.02(c)(ii).
(vi) Upon the issuance or incurrence by any
Loan Party or any of its Subsidiaries of any Indebtedness (other than
Indebtedness referred to in clauses (a), (b), (c), (d) and (e) of the definition
of Permitted Indebtedness), or the sale or issuance by the Borrower of any
shares of its Capital Stock in an aggregate amount in excess of $10,000,000
since the Effective Date, the Borrower shall prepay the outstanding amount of
the Term Loan (or if the Term Loan has been paid in full, the Revolving Loans)
in an amount equal to 100% of the Net Cash Proceeds received by such Person in
connection therewith; provided, that in the case of the sale or issuance of
Capital Stock, only proceeds exceeding $10,000,000 since the Effective Date
shall be prepaid. The provisions of this subsection (vi) shall not be deemed to
be implied consent to any such issuance, incurrence or sale otherwise prohibited
by the terms and conditions of this Agreement.
(vii) Upon the receipt by any Loan Party or
any of its Subsidiaries of any Extraordinary Receipts, the Borrower shall prepay
the outstanding principal of the Term Loan (or, if the Term Loan has been paid
in full, the Revolving Loans) in an amount equal to 100% of such Extraordinary
Receipts, net of any reasonable expenses incurred in collecting such
Extraordinary Receipts, provided that, in the absence of an Event of Default,
Extraordinary Receipts, net of any reasonable expenses incurred in collecting
such Extraordinary Receipts, resulting from the loss, destruction or taking by
condemnation of Collateral in an amount not exceeding $3,000,000 for any one
occurrence may be used to replace, repair or restore Collateral if such
Extraordinary Receipts are deposited in the Cash Collateral Account and used in
accordance with Section 2.05(d).
(d) Application of Payments and Deposits. Each
prepayment pursuant to subsections (c)(iv), (c)(v), (c)(vi) and (c)(vii) above
shall be applied, first, to the Term Loan, and second, to the Revolving Loans.
In accordance with the Cash Collateral Agreement, all amounts deposited in the
Cash Collateral Account pursuant to subsections (v) and (vii) above shall
constitute Collateral for the Obligations. Amounts deposited in the Cash
Collateral Account may be withdrawn by the Borrower to purchase new Equipment
used or useful in the business of the Loan Parties or to replace, repair or
restore lost, destroyed or taken Collateral;
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provided that (i) such withdrawal must be made and (A) such Equipment must be
purchased within 360 days after the date of the receipt of any proceeds of a
Disposition and the Borrower shall deliver a certificate to the Collateral Agent
on or prior to the date of such Disposition (which certificate shall set forth
estimates of the Net Cash Proceeds of a Disposition to be so expended) or (B)
such Collateral must be replaced, repaired or restored within 360 days after the
date of such loss, destruction or taking and the Borrower shall deliver a
certificate to the Collateral Agent within 30 days after the date of such loss,
destruction or taking (which certificate shall set forth estimates of the
proceeds to be so expended), (ii) the amount withdrawn may not exceed the amount
of any such receipt of proceeds or any such loss, destruction or taking, as the
case may be, and (iii) no Default or Event of Default shall have occurred and be
continuing at the time of such withdrawal. Upon the occurrence and during the
continuance of an Event of Default, or if all or any portion of such proceeds
are not so applied to the purchase of new Equipment, or the replacement, repair
or restoration of the Collateral lost, destroyed or taken within the time
periods specified under this subsection (d), prepayment shall be made in
accordance with the first sentence of this subsection (d).
(e) Interest and Fees. Any prepayment made pursuant
to this Section 2.05 (other than prepayments made pursuant to subsections (c)(i)
and (c)(iii) of this Section 2.05) shall be accompanied by accrued and unpaid
interest on the principal amount being prepaid to the date of prepayment, and if
such prepayment would reduce the amount of the outstanding Loans to zero at a
time when the Total Revolving Credit Commitment has been terminated, such
prepayment shall be accompanied by the payment of all fees accrued and unpaid to
such date pursuant to Section 2.06.
(f) Cumulative Prepayments. Except as otherwise
expressly provided in this Section 2.05, payments with respect to any subsection
of this Section 2.05 are in addition to payments made or required to be made
under any other subsection of this Section 2.05.
Section 2.06 Fees. (a) Closing Fee. On or prior to the
Effective Date, the Borrower shall pay to the Administrative Agent for the
account of the Lenders, in accordance with a written agreement among such
Lenders, a non-refundable closing fee (the "Closing Fee") equal to $820,000,
which shall be deemed fully earned when paid.
(b) Commitment Fee. On or prior to the Effective
Date, the Borrower shall pay to the Administrative Agent for the account of the
Lenders, in accordance with a written agreement among such Lenders, a
non-refundable commitment fee (the "Commitment Fee") equal to $500,000, which
shall be deemed fully earned when paid.
(c) Unused Line Fee. From and after the Effective
Date and until the Final Maturity Date, the Borrower shall pay to the
Administrative Agent for the account of the Revolving Loan Lenders, in
accordance with a written agreement among such Lenders, an unused line fee (the
"Unused Line Fee"), which shall accrue at the rate per annum of 0.5% on the
excess, if any, of the Total Revolving Credit Commitment over the sum of the
average principal amount of all Revolving Loans and Letter of Credit Obligations
outstanding from time to time and shall be payable monthly in arrears on the
first day of each month commencing January 2, 2002.
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(d) Loan Servicing Fee. From and after the Effective
Date and until the later of (i) the Final Maturity Date and (ii) the date on
which all Obligations are paid in full, the Borrower shall pay to the
Administrative Agent for the account of the Agents, in accordance with a written
agreement between such Agents, a non-refundable loan servicing fee (the "Loan
Servicing Fee") equal to $20,000 each quarter, which shall be deemed fully
earned when paid and which shall be payable on the Effective Date (payable
ratably based on the number of days remaining in the calendar quarter in which
the Effective Date occurs) and quarterly in advance thereafter on the first day
of each calendar quarter commencing on January 2, 2002; provided that,
notwithstanding the foregoing, if this Agreement is terminated during a quarter,
the Agents shall return a ratable portion of the Loan Servicing Fee paid for
such quarter, which ratable portion shall be calculated based upon the number of
days remaining in the calendar quarter after such termination.
(e) Anniversary Fee. The Borrower shall pay to the
Administrative Agent for the account of the Lenders, in accordance with a
written agreement among such Lenders, a non-refundable anniversary fee (the
"Anniversary Fee") equal to $300,000, which shall be deemed fully earned when
paid and which shall be payable on the Effective Date and on each anniversary of
the Effective Date; provided that, notwithstanding anything to the contrary, if
this Agreement is terminated after any anniversary of the Effective Date and
prior to the Final Maturity Date, the Lenders shall return a ratable portion of
the Anniversary Fee paid for such year, which ratable portion shall be
calculated based upon the number of days remaining in the calendar year after
such termination.
(f) M&E Overadvance Fee. During any time that the M&E
Component of the Borrowing Base must be in excess of $20,000,000 to support the
outstanding Revolving Loans and Letter of Credit Obligations, the Borrower shall
pay to the Administrative Agent for the account of the Revolving Loan Lenders,
in accordance with a written agreement among such Lenders, a non-refundable fee
equal to 1.5% per annum on the portion of the M&E Component in excess of
$20,000,000, which fee shall be payable monthly in arrears.
(g) Amortization Waiver Fee. As a condition to any
Amortization Waiver pursuant to Section 2.05(c)(iv), the Borrower shall pay to
the Administrative Agent for the account of the Lenders, in accordance with a
written agreement among such Lenders, an amortization waiver fee (the
"Amortization Waiver Fee") equal to the sum of (i) an amount equal to 5.0% of
the amount of the prepayment waived by such Amortization Waiver, payable at the
time such Amortization Waiver is granted, and (ii) an amount equal to 2.0% per
annum on the amount of the prepayment waived by such Amortization Waiver that
would have been payable at the time such Amortization Waiver was granted,
payable monthly in arrears, provided, that so long as no Event of Default shall
have occurred and be continuing both immediately before and immediately after
giving effect to such payment and the to the extent permitted by the Indenture,
the Borrower may request and the Collateral Agent agrees upon such request, that
any amount due under clause (ii) of this paragraph (g) shall be capitalized and
added to the outstanding principal amount of the Term Loan and shall constitute
a part of the Term Loan for all purposes of this Agreement.
(h) Early Termination Fee. If the Total Commitment is
terminated prior to May 3, 2004, the Borrower shall pay to the Administrative
Agent, for the Account of the Lenders, in accordance with a written agreement
among such Lenders, on the date of such
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termination, the Early Termination Fee, provided that the Early Termination Fee
shall not be payable if the Total Commitment is terminated as a result of a
refinancing of the Indebtedness under this Agreement by Ableco or any of its
Affiliates and the Administrative Agent or any of its Affiliates.
Section 2.07 Securitization. The Borrower hereby acknowledges
that the Lenders and their Affiliates may sell or securitize the Loans (a
"Securitization") through the pledge of the Loans as collateral security for
loans to the Lenders or their Affiliates or through the sale of the Loans or the
issuance of direct or indirect interests in the Loans, which loans to the
Lenders or their Affiliates or direct or indirect interests will be rated by
▇▇▇▇▇'▇, Standard & Poor's or one or more other rating agencies (the "Rating
Agencies"). The Borrower shall cooperate with the Lenders and their Affiliates
to effect the Securitization including, without limitation, by (a) amending this
Agreement and the other Loan Documents, and executing such additional documents,
as reasonably requested by the Lenders in connection with the Securitization,
provided that (i) any such amendment or additional documentation does not impose
material additional costs on the Borrower and (ii) any such amendment or
additional documentation does not materially adversely affect the rights, or
materially increase the obligations, of the Borrower under the Loan Documents or
change or affect in a manner adverse to the Borrower the financial terms of the
Loans, (b) providing such information as may be reasonably requested by the
Lenders in connection with the rating of the Loans or the Securitization, and
(c) providing in connection with any rating of the Loans a certificate (i)
agreeing to indemnify the Lenders and their Affiliates, any of the Rating
Agencies, or any party providing credit support or otherwise participating in
the Securitization (collectively, the "Securitization Parties") for any losses,
claims, damages or liabilities (the "Liabilities") to which the Lenders, their
Affiliates or such Securitization Parties may become subject insofar as the
Liabilities arise out of or are based upon any untrue statement of any material
fact contained in any Loan Document or in any writing delivered by or on behalf
of any Loan Party to the Lenders in connection with any Loan Document or arise
out of or are based upon the omission to state therein a material fact required
to be stated therein, or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, and such
indemnity shall survive any transfer by the Lenders or their successors or
assigns of the Loans, provided that such indemnity shall not apply to any such
Liabilities that are finally determined by a court of competent jurisdiction to
have been caused by the gross negligence or willful misconduct of the Lenders,
their Affiliates or such Securitization Party, and (ii) agreeing to reimburse
the Lenders and their Affiliates for any legal or other expenses reasonably
incurred by such Persons in connection with defending the Liabilities.
Section 2.08 Taxes. (a) All payments made by the Borrower
hereunder or under any other Loan Document shall be made without set-off,
counterclaim, deduction or other defense. All such payments shall be made free
and clear of and without deduction for any present or future income, franchise,
sales, use, excise, stamp or other taxes, levies, imposts, deductions, charges,
fees, withholdings, restrictions or conditions of any nature now or hereafter
imposed, levied, collected, withheld or assessed by any jurisdiction (whether
pursuant to United States Federal, state, local or foreign law) or by any
political subdivision or taxing authority thereof or therein, and all interest,
penalties or similar liabilities, excluding taxes on the net income, capital or
revenues (collectively, the "Excluded Taxes") of any Lender, any Agent or the
L/C Issuer imposed by the jurisdiction in which such Lender, such Agent or the
L/C Issuer is
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organized or any political subdivision thereof or taxing authority thereof or
any jurisdiction in which such Person's principal office or relevant lending
office is located or any political subdivision thereof or taxing authority
thereof (such nonexcluded taxes, levies, imposts, deductions, charges, fees,
withholdings, restrictions and conditions being hereinafter collectively
referred to as "Taxes"). If the Borrower shall be required by law, rule,
regulation or any interpretation of any relevant Governmental Authority to
deduct or to withhold any Taxes from or in respect of any amount payable
hereunder,
(i) the amount so payable shall be increased
to the extent necessary so that after making all required deductions and
withholdings (including Taxes on amounts payable to the Lenders, the Agents or
the L/C Issuer pursuant to this sentence) the Lenders, the Agents or the L/C
Issuer receive an amount equal to the sum they would have received had no such
deduction or withholding been made,
(ii) the Borrower shall make such deduction
or withholding, and
(iii) the Borrower shall pay the full amount
deducted or withheld to the relevant taxation authority in accordance with
applicable law. Whenever any Taxes are payable by the Borrower, as promptly as
possible thereafter, the Borrower shall send the Lenders, the Agents and the L/C
Issuer an official receipt (or, if an official receipt is not available, such
other documentation as shall be reasonably satisfactory to the Lenders, the
Agents or the L/C Issuer, as the case may be) showing payment. In addition, the
Borrower agrees to pay any present or future taxes, charges or similar levies
which arise from any payment made hereunder or from the execution, delivery,
performance, recordation or filing of, or otherwise with respect to, this
Agreement, the Letters of Credit or any other Loan Document other than the
foregoing excluded taxes (hereinafter referred to as "Other Taxes").
(b) The Borrower will indemnify the Lenders, the
Agents and the L/C Issuer for the amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed by any jurisdiction on
amounts payable under this Section 2.08) paid by any Lender, any Agent or the
L/C Issuer and any liability (including penalties, interest and expenses for
nonpayment, late payment or otherwise) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted; provided that, if the Borrower is required to indemnify any Lender for
the amount of any Taxes or Other Taxes pursuant to this Section 2.08, then such
Lender shall use commercially reasonable efforts to minimize the amount of such
Taxes or Other Taxes for which such indemnity applies if in the reasonable
judgment of such Lender such efforts would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender. The Borrower hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with such efforts.. This indemnification
shall be paid within 10 days from the date on which any such Lender, any such
Agent or the L/C Issuer makes written demand therefor, which demand shall
identify the nature and amount of Taxes or Other Taxes for which indemnification
is being sought and the basis of the claim.
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(c) Each Lender that is organized in a jurisdiction
other than the United States, a State thereof or the District of Columbia hereby
agrees that:
(i) it shall, no later than the Effective
Date (or, in the case of a Lender which becomes a party hereto pursuant to
Section 11.07 hereof after the Effective Date, the date upon which such Lender
becomes a party hereto) deliver to the Borrower and the Agents: (A) two
accurate, complete and signed originals of U.S. Internal Revenue Service Form
W-8ECI or successor form, or (B) two accurate, complete and signed originals of
U.S. Internal Revenue Service Form W-8BEN or successor form, in each case,
indicating that such Lender is on the date of delivery thereof entitled to
receive payments of principal, interest and fees for the account of its lending
office under this Agreement free from, or subject to a reduced rate of,
withholding of United States Federal income tax; and
(ii) if at any time such Lender changes its
lending office or offices or selects an additional lending office for purposes
of this Agreement, it shall, at the same time or reasonably promptly thereafter,
deliver to the Borrower and the Agents the appropriate forms as described in
clause (i) above in replacement for, or in addition to, the forms previously
delivered by it hereunder.
(d) If the Borrower fails to perform any of its
obligations under this Section 2.08, the Borrower shall indemnify the Lenders,
the Agents and the L/C Issuer for any taxes, interest or penalties that may
become payable as a result of any such failure. The obligations of the Borrower
under this Section 2.08 shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
Section 2.09 LIBOR Not Determinable; Illegality or
Impropriety. (a) In the event, and on each occasion, that on or before the day
on which LIBOR is to be determined for a borrowing that is to include LIBOR
Loans, the Administrative Agent has determined in good faith that, or has been
advised by the Collateral Agent or the Required Lenders that, (i) LIBOR cannot
be reasonably determined for any reason, (ii) LIBOR will not adequately and
fairly reflect the cost of maintaining LIBOR Loans or (iii) Dollar deposits in
the principal amount of the applicable LIBOR Loans are not available in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of the Lenders' LIBOR Loans are then being
conducted, the Administrative Agent shall, as soon as practicable thereafter,
give written notice of such determination to the Borrower and the other Lenders.
In the event of any such determination, any request by the Borrower for a LIBOR
Loan pursuant to Section 2.02 shall, until, (i) in the case of such a
determination by the Collateral Agent or the Required Lenders, the
Administrative Agent has been advised by the Collateral Agent or the Required
Lenders and the Administrative Agent has so advised the Borrower that, or (ii)
in the case of a determination by the Administrative Agent, the Administrative
Agent has advised the Borrower and the other Lenders that, the circumstances
giving rise to such notice no longer exist, be deemed to be a request for a
Reference Rate Loan. Each determination by the Administrative Agent, the
Collateral Agent and/or the Required Lenders hereunder shall be conclusive and
binding absent manifest error.
(b) In the event that it shall be unlawful or
improper for any Lender to make, maintain or fund any LIBOR Loan as contemplated
by this Agreement, then such Lender
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shall forthwith give notice thereof to the Administrative Agent and the Borrower
describing such illegality or impropriety in reasonable detail. Effective
immediately upon the giving of such notice, the obligation of such Lender to
make LIBOR Loans shall be suspended for the duration of such illegality or
impropriety and, if and when such illegality or impropriety ceases to exist,
such suspension shall cease, and such Lender shall notify the Administrative
Agent and the Borrower. If any such change shall make it unlawful or improper
for any Lender to maintain any outstanding LIBOR Loan as a LIBOR Loan, such
Lender shall, upon the happening of such event, notify the Administrative Agent
and the Borrower, and the Borrower shall immediately, or if permitted by
applicable law, rule, regulation, order, decree, interpretation, request or
directive, at the end of the then current Interest Period for such LIBOR Loan,
convert each such LIBOR Loan into a Reference Rate Loan.
Section 2.10 Indemnity. (a) The Borrower hereby jointly and
severally indemnifies each Lender against any loss or expense that such Lender
actually sustains or incurs (including, without limitation, any loss or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund or maintain any LIBOR Loan, and including loss
of anticipated profits) as a consequence of (i) any failure by the Borrower to
fulfill on the date of any borrowing hereunder the applicable conditions set
forth in Article V, (ii) any failure by the Borrower to borrow any LIBOR Loan
hereunder, to convert any Reference Rate Loan into a LIBOR Loan or to continue a
LIBOR Loan as such after notice of such borrowing, conversion or continuation
has been given pursuant to Section 2.02 or 2.11 hereof, (iii) any payment,
prepayment (mandatory or optional) or conversion of a LIBOR Loan required by any
provision of this Agreement or otherwise made on a date other than the last day
of the Interest Period applicable thereto, (iv) any default in payment or
prepayment of the principal amount of any LIBOR Loan or any part thereof or
interest accrued thereon, as and when due and payable (at the due date thereof,
by notice of prepayment or otherwise), or (v) the occurrence of any Event of
Default, including, in each such case, any loss (including, without limitation,
loss of anticipated profits) or reasonable expense sustained or incurred in
liquidating or employing deposits from third parties acquired to effect or
maintain such Loan or any part thereof as a LIBOR Loan. Such loss or reasonable
expense shall include but not be limited to an amount equal to the excess, if
any, as reasonably determined by such Lender, of (i) its cost of obtaining the
funds for the Loan being paid or prepaid or converted or continued or not
borrowed or converted or continued (based on LIBOR applicable thereto) for the
period from the date of such payment, prepayment, conversion, continuation or
failure to borrow, convert or continue on the last day of the Interest Period
for such Loan (or, in the case of a failure to borrow, convert or continue, the
last day of the Interest Period for such Loan that would have commenced on the
date of such failure to borrow, convert or continue) over (ii) the amount of
interest (as reasonably determined by such Lender) that would be realized by
such Lender in re-employing the funds so paid, prepaid, converted or continued
or not borrowed, converted or continued for such Interest Period. A certificate
of any Lender setting forth in reasonable detail any amount or amounts that such
Lender is entitled to receive pursuant to this Section 2.10 and the basis for
the determination of such amount or amounts shall be delivered to the Borrower
and shall be conclusive and binding absent manifest error.
(b) Notwithstanding paragraph (a) of this Section
2.10, the Administrative Agent will use reasonable efforts to minimize or reduce
any such loss or expense resulting from the mandatory prepayments required by
Section 2.05 of this Agreement by
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applying all payments and prepayments to Reference Rate Loans prior to any
application of payments to LIBOR Loans.
Section 2.11 Continuation and Conversion of Loans. Subject to
Section 2.09 hereof, the Borrower shall have the right, at any time, on three
(3) Business Days' prior irrevocable written or telecopy notice to the
Administrative Agent, to continue any LIBOR Loan, or any portion thereof, into a
subsequent Interest Period or to convert any Reference Rate Loan or portion
thereof into a LIBOR Loan, or on one (1) Business Day's prior irrevocable
written or telecopy notice to the Administrative Agent, to convert any LIBOR
Loan or portion thereof into a Reference Rate Loan, subject to the following:
(a) no LIBOR Loan may be continued as such and no
Reference Rate Loan may be converted into a LIBOR Loan, when any Event of
Default or Default shall have occurred and be continuing at such time,
(b) in the case of a continuation of a LIBOR Loan as
such or a conversion of a Reference Rate Loan into a LIBOR Loan, the aggregate
principal amount of such LIBOR Loan shall not be less than $1,000,000 and in
multiples of $500,000 if in excess thereof;
(c) any portion of a Loan maturing or required to be
repaid in less than one month may not be converted into or continued as a LIBOR
Loan; and
(d) if any conversion of a LIBOR Loan shall be
effected on a day other than the last day of an Interest Period, the Borrower
shall reimburse each Lender on demand for any loss incurred or to be incurred or
to be incurred by it in the reemployment of the funds released by such
conversion as provided in Section 2.10 hereof.
In the event that the Borrower shall not give notice to continue any LIBOR Loan
into a subsequent Interest Period, such Loan shall automatically become a
Reference Rate Loan at the expiration of the then current Interest Period.
ARTICLE III
LETTERS OF CREDIT
Section 3.01 Letter of Credit Guaranty. (a) In order to assist
the Borrower in establishing or opening standby letters of credit, which shall
not have initial expiration dates that exceed 360 days or, if acceptable to the
L/C Issuer, 366 days, from the date of issuance (each a "Letter of Credit"),
with the L/C Issuer, on and after the L/C Subfacility Effective Date, the
Borrower may request the Administrative Agent to join in the applications for
such Letters of Credit, and/or guarantee payment or performance of such Letters
of Credit and any drafts thereunder through the issuance of a Letter of Credit
Guaranty, thereby lending the Administrative Agent's credit to that of the
Borrower, and the Administrative Agent will agree to do so. These arrangements
shall be coordinated by the Administrative Agent, subject to the terms and
conditions set forth below and the terms and provisions of this Article III
shall not be applicable prior to the L/C Subfacility Effective Date. The
Administrative Agent shall not be required to be the issuer of any Letter of
Credit. The Borrower will be the account party for the application for each
Letter of Credit, which shall be in form and substance satisfactory to the
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Administrative Agent and the L/C Issuer or on a computer transmission system
approved by the Administrative Agent and the L/C Issuer, or such other written
form or computer transmission system as may from time to time be approved by the
Administrative Agent and the L/C Issuer, and shall be duly completed in a manner
reasonably acceptable to the Administrative Agent, together with such other
certificates, agreements, documents and other papers and information as the
Administrative Agent and the L/C Issuer may reasonably request (the "Letter of
Credit Application"). In the event of any conflict between the terms of any
Letter of Credit Application and this Agreement, for purposes of this Agreement,
the terms of this Agreement shall control.
(b) The aggregate Letter of Credit Obligations shall
not exceed the lowest of (i) the difference between (A) the Total Revolving
Credit Commitment and (B) the aggregate principal amount of all Revolving Loans
then outstanding, (ii) the difference between (A) the Borrowing Base and (B) the
aggregate principal amount of all Revolving Loans then outstanding, (iii) the
L/C Subfacility, (iv) the difference between (A) an amount equal to (x) two (2)
multiplied by (y) the Consolidated EBITDA of the Borrower and its Subsidiaries
for the most recently completed twelve months and (B) the aggregate principal
amount of Loans then outstanding, and (v) the difference between (A) the maximum
principal amount of Indebtedness which, in accordance with the Indenture, is
permitted to be incurred and (B) the aggregate principal amount of Loans then
outstanding. In addition, the terms and conditions of all Letters of Credit and
all changes or modifications thereof by the Borrower and/or the L/C Issuer shall
in all respects be subject to the prior approval of the Administrative Agent in
the exercise of its reasonable business judgment; provided, however, that (i)
the expiry date of all Letters of Credit shall be no later than fifteen days
prior to the Final Maturity Date unless, on or prior to fifteen days prior to
the Final Maturity Date either (A) such Letters of Credit shall be cash
collateralized in an amount equal to 110% of the face amount of such Letters of
Credit by deposit of cash in such amount in an account under the sole and
exclusive control of the Administrative Agent for the benefit of the
Administrative Agent and/or the L/C Issuer (the "Letter of Credit Collateral
Account") or (B) the Borrower shall provide the Administrative Agent and the
Revolving Loan Lenders with an indemnification, in form and substance reasonably
satisfactory to the Administrative Agent, from a commercial bank or other
financial institution acceptable to the Agents for any Letter of Credit
Obligations with respect to such Letters of Credit and (ii) the Letters of
Credit and all documentation in connection therewith shall be in form and
substance reasonably satisfactory to the Administrative Agent and the L/C
Issuer.
(c) The Administrative Agent shall have the right,
without notice to the Borrower, to charge the Loan Account with the amount of
any and all Indebtedness, liabilities and obligations of any kind (including
indemnification for breakage costs, capital adequacy and reserve requirement
charges) incurred by the Agents or the Revolving Loan Lenders under the Letter
of Credit Guaranty or incurred by the L/C Issuer with respect to a Letter of
Credit at the earlier of (i) payment by the Administrative Agent or the
Revolving Loan Lenders under the Letter of Credit Guaranty or (ii) the
occurrence of any Default or Event of Default. Any amount charged to the Loan
Account shall be deemed a Revolving Loan hereunder made by the Revolving Loan
Lenders to the Borrower, funded by the Administrative Agent on behalf of the
Revolving Loan Lenders and subject to Section 2.02 of this Agreement. Any
charges, fees, commissions, costs and expenses charged to the Administrative
Agent for the Borrower's account by the L/C Issuer in connection with or arising
out of Letters of Credit or transactions relating thereto will be charged to the
Loan Account in full when charged to or paid
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by the Administrative Agent and, when charged, shall be conclusive on the
Borrower absent manifest error. Each of the Revolving Loan Lenders and the
Borrower agrees that the Administrative Agent shall have the right to make such
charges regardless of whether any Default or Event of Default shall have
occurred and be continuing or whether any of the conditions precedent in Section
5.02 have been satisfied.
(d) The Borrower unconditionally indemnifies each
Agent and each Lender and holds each Agent and each Lender harmless from any and
all loss, claim or liability incurred by any Agent or any Lender arising from
any transactions or occurrences relating to Letters of Credit, any drafts or
acceptances thereunder, the Collateral relating thereto, and all Obligations in
respect thereof, including any such loss or claim due to any action taken by the
L/C Issuer, other than for any such loss, claim or liability arising out of the
gross negligence or willful misconduct of the L/C Issuer, any Agent or any
Lender as determined by a final judgment of a court of competent jurisdiction.
The Borrower further agrees to jointly and severally hold each Agent and each
Lender harmless from any errors or omission, negligence or misconduct by the L/C
Issuer. The Borrower's unconditional obligations to each Agent, each Lender and
the L/C Issuer with respect to Letters of Credit hereunder shall not be modified
or diminished for any reason or in any manner whatsoever, other than as a result
of such Agent's, such Lender's or the L/C Issuer's gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction. The Borrower agrees that any charges incurred by the
Administrative Agent or the L/C Issuer for the Borrower's account hereunder may
be charged to the Loan Account.
(e) Upon any payments made to the L/C Issuer under
the Letter of Credit Guaranty, the Agents or the Revolving Loan Lenders, as the
case may be, shall, without prejudice to their rights under this Agreement
(including that such unreimbursed amounts shall constitute Loans hereunder),
acquire by subrogation, any rights, remedies, duties or obligations granted or
undertaken by the Borrower in favor of the L/C Issuer in any application for
Letters of Credit, any standing agreement relating to Letters of Credit or
otherwise, all of which shall be deemed to have been granted to the Agents and
the Revolving Loan Lenders and apply in all respects to the Agents and the
Revolving Loan Lenders and shall be in addition to any rights, remedies, duties
or obligations contained herein.
Section 3.02 Participations. (a) Purchase of Participations.
Immediately upon issuance by the L/C Issuer of any Letter of Credit pursuant to
this Agreement, each Revolving Loan Lender shall be deemed to have irrevocably
and unconditionally purchased and received from the Administrative Agent,
without recourse or warranty, an undivided interest and participation, to the
extent of such Revolving Loan Lender's Pro Rata Share, in all obligations of the
Administrative Agent in such Letter of Credit (including, without limitation,
all Reimbursement Obligations of the Borrower with respect thereto pursuant to
the Letter of Credit Guaranty or otherwise).
(b) Sharing of Payments. In the event that the
Administrative Agent makes any payment in respect of the Letter of Credit
Guaranty and the Borrower shall not have repaid such amount to the
Administrative Agent, the Administrative Agent shall charge the Loan Account in
the amount of the Reimbursement Obligation, in accordance with Sections 3.01(c)
and 4.02 of this Agreement.
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(c) Obligations Irrevocable. The obligations of a
Revolving Loan Lender to make payments to the Administrative Agent for the
account of the Agents, the Revolving Loan Lenders or the L/C Issuer with respect
to a Letter of Credit shall be irrevocable, without any qualification or
exception whatsoever and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances, including, without
limitation, any of the following circumstances:
(i) any lack of validity or enforceability
of this Agreement or any of the other Loan Documents;
(ii) the existence of any claim, setoff,
defense or other right which the Borrower may have at any time against a
beneficiary named in such Letter of Credit or any transferee of such Letter of
Credit (or any Person for whom any such transferee may be acting), any Agent,
any Lender, or any other Person, whether in connection with this Agreement, such
Letter of Credit, the transactions contemplated herein or any unrelated
transactions (including any underlying transactions between the Borrower or any
other party and the beneficiary named in such Letter of Credit);
(iii) any draft, certificate or any other
document presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any
security for the performance or observance of any of the terms of any of the
Loan Documents;
(v) any failure by any Agent to provide any
notices required pursuant to this Agreement relating to such Letter of Credit;
(vi) any payment by the L/C Issuer under
such Letter of Credit against presentation of a draft or certificate which does
not comply with the terms of such Letter of Credit; or
(vii) the occurrence of any Default or Event
of Default.
Section 3.03 Letters of Credit. (a) Request for Issuance. On
and after the L/C Subfacility Effective Date, the Borrower may, upon notice not
later than 12:00 noon, New York City time, at least two (2) Business Days in
advance of the issuance thereof, request the Administrative Agent to assist the
Borrower in establishing or opening a Letter of Credit by delivering to the
Administrative Agent, with a copy to the L/C Issuer, a Letter of Credit
Application, together with any necessary related documents. The Administrative
Agent shall not provide support, pursuant to the Letter of Credit Guaranty, if
the Administrative Agent shall have received written notice from the Collateral
Agent or the Required Lenders on the Business Day immediately preceding the
proposed issuance date for such Letter of Credit that one or more of the
conditions precedent in Section 5.02 will not have been satisfied on such date,
and the Administrative Agent shall not otherwise be required to determine that,
or take notice whether, the conditions precedent set forth in Section 5.02 have
been satisfied.
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(b) Letter of Credit Fees. (i) The Borrower shall pay
to the Administrative Agent for the account of the Lenders, in accordance with a
separate written agreement among such Lenders (x) for any Letter of Credit
issued hereunder, a non-refundable fee equal to 3.5% per annum of the undrawn
amount of such Letter of Credit, payable monthly in arrears and (y) for any
amendment to an existing Letter of Credit that increases the stated amount of
such Letter of Credit, a non-refundable fee equal to 3.5% per annum of the
increase in the stated amount of such Letter of Credit, payable monthly in
arrears (the "Letter of Credit Fees").
(ii) L/C Issuer Charges. The Borrower shall
pay to the Administrative Agent the standard charges assessed by the L/C Issuer
in connection with the issuance, administration, amendment, payment or
cancellation of Letters of Credit.
(iii) Charges to the Loan Account. The
Borrower hereby authorizes the Administrative Agent to, and the Administrative
Agent may, from time to time, charge the Loan Account pursuant to Sections
3.01(c) and 4.02 of this Agreement with the amount of any Letter of Credit fees
or charges due under this Section 3.03.
ARTICLE IV
FEES, PAYMENTS AND OTHER COMPENSATION
Section 4.01 Audit and Collateral Monitoring Fees. The
Borrower acknowledges that pursuant to Section 7.01(f) and subject to the
limitations set forth in such Section, representatives of the Agents may visit
any Loan Party and/or conduct audits, inspections and/or field examinations of
any Loan Party and valuations or appraisals of any or all of the Collateral
and/or business or enterprise valuations of the Loan Parties at any time and
from time to time in a manner so as to not unduly disrupt the business of such
Loan Party. The Borrower agrees to pay (i) $750 per day per examiner plus the
examiner's reasonable out-of-pocket costs and reasonable expenses incurred in
connection with all such visits, audits, inspections and field examinations and
(ii) the reasonable cost of all audits, appraisals and valuations conducted by
third party auditors or appraisers on behalf of the Agents.
Section 4.02 Payments; Computations and Statements. (a) The
Borrower will make each payment under this Agreement not later than 1:00 p.m.
(New York City time) on the day when due, in lawful money of the United States
of America and in immediately available funds, to the Administrative Agent's
Account. All payments received by the Administrative Agent after 1:00 p.m. (New
York City time) on any Business Day will be credited to the Loan Account on the
next succeeding Business Day. All payments shall be made by the Borrower without
set-off, counterclaim, deduction or other defense to the Agents and the Lenders.
Except as provided in Section 2.02, after receipt, the Administrative Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal ratably to the Lenders in accordance with their Pro Rata Shares and
like funds relating to the payment of any other amount payable to any Lender to
such Lender, in each case to be applied in accordance with the terms of this
Agreement, provided that the Administrative Agent will cause to be distributed
all interest and fees received from or for the account of the Borrower not less
than once each month and in any event promptly after receipt thereof. The
Lenders and the Borrower hereby authorize the Administrative Agent to, and the
Administrative Agent may, from time to time, charge the Loan
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Account of the Borrower with any amount due and payable by the Borrower under
any Loan Document. Each of the Lenders and the Borrower agrees that the
Administrative Agent shall have the right to make such charges whether or not
any Default or Event of Default shall have occurred and be continuing or whether
any of the conditions precedent in Section 5.02 have been satisfied. Any amount
charged to the Loan Account of the Borrower shall be deemed a Revolving Loan
hereunder made by the Revolving Loan Lenders to the Borrower, funded by the
Administrative Agent on behalf of the Revolving Loan Lenders and subject to
Section 2.02 of this Agreement. The Lenders and the Borrower confirm that any
charges which the Administrative Agent may so make to the Loan Account of the
Borrower as herein provided will be made as an accommodation to the Borrower and
solely at the Administrative Agent's discretion; provided that the
Administrative Agent shall from time to time upon the request of the Collateral
Agent, charge the Loan Account of the Borrower with any amount due and payable
under any Loan Document. Whenever any payment to be made under any such Loan
Document shall be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day and such extension of
time shall in such case be included in the computation of interest or fees, as
the case may be. All computations of fees shall be made by the Administrative
Agent on the basis of a year of 360 days for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such fees are payable. Each determination by the Administrative Agent of
an interest rate or fees hereunder shall be conclusive and binding for all
purposes in the absence of manifest error.
(b) The Administrative Agent shall provide the
Borrower, promptly after the end of each calendar month, a summary statement (in
the form from time to time used by the Administrative Agent) of the opening and
closing daily balances in the Loan Account of the Borrower during such month,
the amounts and dates of all Loans made to the Borrower during such month, the
amounts and dates of all payments on account of the Loans to the Borrower during
such month and the Loans to which such payments were applied, the amount of
interest accrued on the Loans to the Borrower during such month, any Letters of
Credit issued by the L/C Issuer for the account of the Borrower during such
month, specifying the face amount thereof, the amount of charges to the Loan
Account and/or Loans made to the Borrower during such month to reimburse the
Revolving Loan Lenders for drawings made under Letters of Credit, and the amount
and nature of any charges to the Loan Account made during such month on account
of fees, commissions, expenses and other Obligations. All entries on any such
statement shall be presumed to be correct and, thirty (30) days after the same
is sent, shall be final and conclusive absent manifest error.
Section 4.03 Sharing of Payments, Etc. Except as provided in
Section 2.02 hereof, if any Lender shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) on
account of any Obligation in excess of its ratable share of payments on account
of similar obligations obtained by all the Lenders, such Lender shall forthwith
purchase from the other Lenders such participations in such similar obligations
held by them as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing
Lender, such purchase from each Lender shall be rescinded and such Lender shall
repay to the purchasing Lender the purchase price to the extent of such recovery
together with an amount equal to such Lender's ratable share (according to the
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proportion of (i) the amount of such Lender's required repayment to (ii) the
total amount so recovered from the purchasing Lender of any interest or other
amount paid by the purchasing Lender in respect of the total amount so
recovered). The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 4.03 may, to the fullest extent
permitted by law, exercise all of its rights (including the Lender's right of
set-off) with respect to such participation as fully as if such Lender were the
direct creditor of the Borrower in the amount of such participation.
Section 4.04 Apportionment of Payments. Subject to Section
2.02 hereof and to any written agreement among the Agents and/or the Lenders:
(a) all payments of principal and interest in respect
of outstanding Loans, all payments in respect of the Reimbursement Obligations,
all payments of fees (other than the fees set forth in Section 2.06 hereof to
the extent set forth in a written agreement among the Agents and the Lenders,
fees with respect to Letters of Credit provided for in Section 3.03(b)(ii) and
the audit and collateral monitoring fee provided for in Section 4.01) and all
other payments in respect of any other Obligations, shall be allocated by the
Administrative Agent among such of the Lenders as are entitled thereto, in
proportion to their respective Pro Rata Shares or otherwise as provided herein
or, in respect of payments not made on account of Loans or Letter of Credit
Obligations, as designated by the Person making payment when the payment is
made.
(b) After the occurrence and during the continuance
of an Event of Default, the Administrative Agent may, and upon the direction of
the Required Lenders shall, apply all payments in respect of any Obligations and
all proceeds of the Collateral, subject to the provisions of this Agreement, (i)
first, ratably to pay the Obligations in respect of any fees, expense
reimbursements, indemnities and other amounts then due to the Agents or the L/C
Issuer until paid in full; (ii) second, ratably to pay the Revolving Loan
Obligations in respect of any fees and indemnities then due to the Revolving
Loan Lenders until paid in full; (iii) third, ratably to pay interest due in
respect of the Revolving Loans, Collateral Agent Advances and Reimbursement
Obligations until paid in full; (iv) fourth, ratably to pay principal of the
Revolving Loans, Collateral Agent Advances and Letter of Credit Obligations (or,
to the extent such Obligations are contingent, to provide cash collateral in
respect of such Obligations) until paid in full; (v) fifth, ratably to pay the
Term Loan Obligations in respect of any fees and indemnities then due to the
Term Loan Lenders until paid in full; (vi) sixth, ratably to pay interest due in
respect of the Term Loan until paid in full; (vii) seventh, ratably to pay
principal of the Term Loan until paid in full, and (viii) eighth, to the ratable
payment of all other Obligations then due and payable.
(c) In each instance, so long as no Event of Default
has occurred and is continuing, Section 4.04(b) shall not be deemed to apply to
any payment by the Borrower specified by the Borrower to the Administrative
Agent to be for the payment of Term Loan Obligations then due and payable under
any provision of this Agreement or the prepayment of all or part of the
principal of the Term Loan in accordance with the terms and conditions of
Section 2.05.
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(d) For purposes of Section 4.04(b), "paid in full"
with respect to interest shall include interest accrued after the commencement
of any Insolvency Proceeding irrespective of whether a claim for such interest
is allowable in such Insolvency Proceeding.
(e) In the event of a direct conflict between the
priority provisions of this Section 4.04 and other provisions contained in any
other Loan Document, it is the intention of the parties hereto that both such
priority provisions in such documents shall be read together and construed, to
the fullest extent possible, to be in concert with each other. In the event of
any actual, irreconcilable conflict that cannot be resolved as aforesaid, the
terms and provisions of this Section 4.04 shall control and govern.
Section 4.05 Increased Costs and Reduced Return. (a) If any
Lender, any Agent or the L/C Issuer shall have determined that the adoption or
implementation of, or any change in, any law, rule, treaty or regulation, or any
policy, guideline or directive of, or any change in, the interpretation or
administration thereof by, any court, central bank or other administrative or
Governmental Authority, or compliance by any Lender, any Agent or the L/C Issuer
or any Person controlling any such Lender, any such Agent or the L/C Issuer with
any directive of, or guideline from, any central bank or other Governmental
Authority or the introduction of, or change in, any accounting principles
applicable to any Lender, any Agent or the L/C Issuer or any Person controlling
any such Lender, any such Agent or the L/C Issuer (in each case, whether or not
having the force of law), shall (i) subject any Lender, any Agent or the L/C
Issuer, or any Person controlling any such Lender, any such Agent or the L/C
Issuer to any tax, duty or other charge with respect to this Agreement or any
Loan made by such Lender or such Agent or any Letter of Credit issued by the L/C
Issuer, or change the basis of taxation of payments to any Lender, any Agent or
the L/C Issuer or any Person controlling any such Lender, any such Agent or the
L/C Issuer of any amounts payable hereunder (except for the Excluded Taxes of
any Lender, any Agent or the L/C Issuer or any Person controlling any such
Lender, any such Agent or the L/C Issuer), (ii) impose, modify or deem
applicable any reserve, special deposit or similar requirement against any Loan,
any Letter of Credit or against assets of or held by, or deposits with or for
the account of, or credit extended by, any Lender, any Agent or the L/C Issuer
or any Person controlling any such Lender, any such Agent or the L/C Issuer or
(iii) impose on any Lender, any Agent or the L/C Issuer or any Person
controlling any such Lender, any such Agent or the L/C Issuer any other
condition regarding this Agreement or any Loan or Letter of Credit, and the
result of any event referred to in clauses (i), (ii) or (iii) above shall be to
increase the cost to any Lender, any Agent or the L/C Issuer of making any Loan,
issuing, guaranteeing or participating in any Letter of Credit, or agreeing to
make any Loan or issue, guaranty or participate in any Letter of Credit, or to
reduce any amount received or receivable by any Lender, any Agent or the L/C
Issuer hereunder, then, upon demand by any such Lender, any such Agent or the
L/C Issuer, the Borrower shall pay to such Lender, such Agent or the L/C Issuer
such additional amounts as will compensate such Lender, such Agent or the L/C
Issuer for any such increased costs or reductions in amount; provided, however,
that (A) the Borrower shall not be required to pay any Lender reimbursement with
regard to any such increased costs, unless such Lender notifies the Borrower of
such increased costs within 270 days after the earlier of the date such
increased costs are paid by such Lender or the first date on which such Lender
has actual knowledge that such increased costs have been incurred by such Lender
and (B) the Borrower shall not be obligated to a Lender for any increased costs
under this Section 4.05(a) unless such Lender is attempting to obtain such
increased costs from other
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similarly situated account parties or borrowers of such Lender where such
account parties or borrowers have similar relationships with the Lender under
documentation which gives the Lender the same rights with respect to such
increased costs.
(b) If any Lender, any Agent or the L/C Issuer shall
have determined that any Capital Guideline or the adoption or implementation of,
or any change in, any Capital Guideline by the Governmental Authority charged
with the interpretation or administration thereof, or compliance by any Lender,
any Agent or the L/C Issuer or any Person controlling such Lender, such Agent or
the L/C Issuer with any Capital Guideline or with any request or directive of
any such Governmental Authority with respect to any Capital Guideline, or the
implementation of, or any change in, any applicable accounting principles (in
each case, whether or not having the force of law), either (i) affects or would
affect the amount of capital required or expected to be maintained by any
Lender, any Agent or the L/C Issuer or any Person controlling such Lender, such
Agent or the L/C Issuer, and any Lender, any Agent or the L/C Issuer determines
that the amount of such capital is increased as a direct or indirect consequence
of any Loans made or maintained, Letters of Credit issued or any guaranty or
participation with respect thereto, any Lender's, any Agent's or the L/C
Issuer's or any such other controlling Person's other obligations hereunder, or
(ii) has or would have the effect of reducing the rate of return on any
Lender's, any Agent's or the L/C Issuer's any such other controlling Person's
capital to a level below that which such Lender, such Agent or the L/C Issuer or
such controlling Person could have achieved but for such circumstances as a
consequence of any Loans made or maintained, Letters of Credit issued, or any
guaranty or participation with respect thereto or any agreement to make Loans,
to issue Letters of Credit or such Lender's, such Agent's or the L/C Issuer's or
such other controlling Person's other obligations hereunder (in each case,
taking into consideration, such Lender's, such Agent's or the L/C Issuer's or
such other controlling Person's policies with respect to capital adequacy),
then, upon demand by any Lender, any Agent or the L/C Issuer, the Borrower shall
pay to such Lender, such Agent or the L/C Issuer from time to time such
additional amounts as will compensate such Lender, such Agent or the L/C Issuer
for any such cost of maintaining such increased capital or any such reduction in
the rate of return on such Lender's, such Agent's or the L/C Issuer's or such
other controlling Person's capital.
(c) All amounts payable under this Section 4.05 shall
bear interest from the date that is ten (10) days after the date of demand by
any Lender, any Agent or the L/C Issuer until payment in full to such Lender,
such Agent or the L/C Issuer at the Reference Rate. A certificate of such
Lender, such Agent or the L/C Issuer claiming compensation under this Section
4.05, specifying the event herein above described and the nature of such event
shall be submitted by such Lender, such Agent or the L/C Issuer to the Borrower,
setting forth the additional amount due and an explanation of the calculation
thereof, and such Lender's, such Agent's or the L/C Issuer's reasons for
invoking the provisions of this Section 4.05, and shall be final and conclusive
absent manifest error.
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ARTICLE V
CONDITIONS TO LOANS
Section 5.01 Conditions Precedent to Effectiveness. This
Agreement shall become effective as of the Business Day (the "Effective Date")
when each of the following conditions precedent shall have been satisfied in a
manner satisfactory to the Agents:
(a) Payment of Fees, Etc. The Borrower shall have
paid on or before the date of this Agreement all fees, costs, expenses and taxes
then payable pursuant to Sections 2.06 and 11.04.
(b) Representations and Warranties; No Event of
Default. The following statements shall be true and correct: (i) the
representations and warranties contained in Article VI and in each other Loan
Document, certificate or other writing delivered to any Agent, any Lender or the
L/C Issuer pursuant hereto or thereto on or prior to the Effective Date are true
and correct on and as of the Effective Date as though made on and as of such
date and (ii) no Default or Event of Default shall have occurred and be
continuing on the Effective Date or would result from this Agreement or the
other Loan Documents becoming effective in accordance with its or their
respective terms.
(c) Legality. The making of the initial Loans or the
issuance of any Letters of Credit shall not contravene any law, rule or
regulation applicable to any Agent, any Lender or the L/C Issuer.
(d) Delivery of Documents. The Collateral Agent shall
have received on or before the Effective Date the following, each in form and
substance satisfactory to the Collateral Agent and, unless indicated otherwise,
dated the Effective Date:
(i) a Security Agreement, duly executed by
each Loan Party;
(ii) a Pledge Agreement, duly executed by
the Borrower, together with the original stock certificates representing all of
the common stock of each other Loan Party and all intercompany promissory notes
of each other Loan Party, accompanied by undated stock powers executed in blank
and other proper instruments of transfer;
(iii) a Cash Collateral Agreement;
(iv) a Mortgage Assignment for each of the
Mortgages described on Schedule 5.01(d)(iv) hereto;
(v) evidence of the delivery of the Mortgage
Assignments and/or Mortgages to the appropriate authorities in such office or
offices as may be necessary or, in the opinion of the Collateral Agent,
desirable to record and perfect the Lien purported to be created thereby or to
otherwise protect the rights of the Collateral Agent and the Lenders thereunder;
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(vi) the Title Insurance Policy and
endorsement to the Title Insurance Policy insuring the Mortgage Assignment,
dated as of the Effective Date;
(vii) a survey of the Facilities described
on Schedule 5.01(d)(vii) hereto, in form and substance satisfactory to the
Collateral Agent, certified to the Collateral Agent and to the issuer of the
Title Insurance Policy;
(viii) a UCC Filing Authorization Letter,
duly executed by each Loan Party, together with appropriate financing statements
on Form UCC-1 duly filed in such office or offices as may be necessary or, in
the opinion of the Collateral Agent, desirable to perfect the security interests
purported to be created by each Security Agreement, each Pledge Agreement and
each Mortgage;
(ix) certified copies of request for copies
of information on Form UCC-11, listing all effective financing statements which
name as debtor any Loan Party and which are filed in the offices referred to in
paragraph (viii) above, together with copies of such financing statements, none
of which, except with respect to Permitted Liens, shall cover any of the
Collateral and the results of searches for any tax Lien and judgment Lien filed
against such Person or its property, which results, except with respect to
Permitted Liens, shall not show any such Liens;
(x) a copy of the resolutions of each Loan
Party, certified as of the Effective Date by an Authorized Officer thereof,
authorizing (A) the borrowings hereunder and the transactions contemplated by
the Loan Documents to which such Loan Party is or will be a party, and (B) the
execution, delivery and performance by such Loan Party of each Loan Document to
which such Loan Party is or will be a party and the execution and delivery of
the other documents to be delivered by such Person in connection herewith and
therewith;
(xi) a certificate of an Authorized Officer
of each Loan Party, certifying the names and true signatures of the
representatives of such Loan Party authorized to sign each Loan Document to
which such Loan Party is or will be a party and the other documents to be
executed and delivered by such Loan Party in connection herewith and therewith,
together with evidence of the incumbency of such authorized officers;
(xii) a certificate of the appropriate
official(s) of the state of organization and each state of foreign qualification
of each Loan Party certifying as to the subsistence in good standing of, and the
payment of taxes by, such Loan Party in such states;
(xiii) a true and complete copy of the
charter of each Loan Party certified as of a recent date not more than 30 days
prior to the Effective Date by an appropriate official of the state of
organization of such Loan Party which shall set forth the same complete name of
such Loan Party as is set forth herein and the organizational number of such
Loan Party, if an organized number is issued in such jurisdiction;
(xiv) a copy of the charter and by-laws of
each Loan Party, together with all amendments thereto, certified as of the
Effective Date by an Authorized Officer of such Loan Party;
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(xv) an opinion of Akin, Gump, Strauss,
▇▇▇▇▇ & ▇▇▇▇, L.L.P., counsel to the Loan Parties, as to such matters as the
Collateral Agent may reasonably request;
(xvi) a certificate of an Authorized Officer
of each Loan Party, certifying as to the matters set forth in subsection (b) of
this Section 5.01;
(xvii) a copy of the Financial Statements,
together with a certificate of an Authorized Officer of the Borrower setting
forth all existing Indebtedness, pending or, to the knowledge of the Borrower,
threatened litigation or claims and other contingent liabilities of the Borrower
and its Subsidiaries;
(xviii) a copy of the financial projections
described in Section 6.01(g)(ii) hereof, which projections shall be satisfactory
in form and substance to the Agents;
(xix) evidence of the insurance coverage
required by Section 7.01 and the terms of each Security Agreement and each
Mortgage and such other insurance coverage with respect to the business and
operations of the Loan Parties as the Collateral Agent may reasonably request,
in each case, where requested by the Collateral Agent, with such endorsements as
to the named insureds or loss payees thereunder as the Collateral Agent may
reasonably request and providing that such policy may be terminated or canceled
(by the insurer or the insured thereunder) only upon 30 days' prior written
notice to the Collateral Agent and each such named insured or loss payee,
together with evidence of the payment of all premiums due in respect thereof for
such period as the Collateral Agent may reasonably request;
(xx) a certificate of an Authorized Officer
of the Borrower, certifying the names and true signatures of the persons that
are authorized to provide Notices of Borrowing, Letter of Credit Applications
and all other notices under this Agreement and the other Loan Documents;
(xxi) a certificate of the chief financial
officer of the Borrower, certifying as to the solvency of the Borrower, which
certificate shall be satisfactory in form and substance to the Agents;
(xxii) (A) the original or, if no original
is available, a copy of each landlord subordination agreement executed by each
landlord with respect to each of the Leases set forth on Schedule 6.01(o) that
was obtained in connection with the Existing Credit Agreement, (B) an agreement
assigning the rights of the Existing Agents under each such landlord
subordination agreement to the Collateral Agent, which agreement shall be in
form and substance satisfactory to the Collateral Agent, and (C) a letter to
each such landlord providing notice of such assignment by the Existing Agents to
the Collateral Agent;
(xxiii) (A) the original or, if no original
is available, a copy of each access agreement executed by each Person possessing
the Loan Parties' Equipment that was obtained in connection with the Existing
Credit Agreement, (B) an agreement assigning the rights of the Existing Agents
under each such access agreement to the Collateral Agent, in form and substance
satisfactory to the Collateral Agent, and (C) a notice letter to each such
Person providing notice of such assignment by the Existing Agent to the
Collateral Agent;
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(xxiv) copies of the Indenture and the other
Material Contracts as in effect on the Effective Date, certified as true and
correct copies thereof by an Authorized Officer of the Borrower, together with a
certificate of an Authorized Officer of the Borrower stating that such
agreements remain in full force and effect and that none of the Loan Parties has
breached or defaulted in any of its obligations under such agreements;
(xxv) such depository account, blocked
account, lockbox account and similar agreements and other documents, each in
form and substance satisfactory to the Agents, as the Agents may reasonably
request with respect to the Borrower's cash management system;
(xxvi) a copy of the executed Reddy Asset
Purchase Agreement, together with all schedules and exhibits thereto, certified
as a true and correct copy thereof by an Authorized Officer of the Borrower;
(xxvii) originals of (A) each guaranty
executed by the Loan Parties in connection with the Existing Credit Agreement,
(B) each pledge agreement executed by the Loan Parties in connection with the
Existing Credit Agreement, (C) each security agreement executed by the Loan
Parties in connection with the Existing Credit Agreement, (D) the Existing
Credit Agreement and all amendments thereto, (E) each promissory note executed
in connection with the Existing Credit Agreement indorsed to the Lenders, and
(F) all other loan documents executed or issued in connection with the Existing
Credit Agreement, in each case, along with all current exhibits and schedules
thereto, all notes, and any other documents related to the Existing Credit
Agreement, all certified as true and correct copies thereof by an Authorized
Officer of the Borrower;
(xxviii) (A) an assignment and acceptance
agreement in form and substance satisfactory to the Agents with respect to the
sale by the Existing Lenders and the purchase by the Lenders of all of the
rights and obligations under the Existing Credit Agreement and the related loan
documents, duly executed by the Existing Lenders and the Loan Parties, (B) a
resignation and appointment of agent agreement in form and substance reasonably
satisfactory to the Agents duly executed by the Existing Agents and the Loan
Parties and (C) UCC-3 assignment duly executed by the Existing Agents;
(xxix) such other agreements, instruments,
approvals, opinions and other documents, each satisfactory to the Collateral
Agent in form and substance, as the Collateral Agent may reasonably request; and
(xxx) the B of A Intercreditor Agreement.
(e) Material Adverse Effect. The Collateral Agent
shall have determined, in its sole judgment, that no event or development shall
have occurred since September 30, 2001, which could reasonably be expected to
have a Material Adverse Effect.
(f) Proceedings; Receipt of Documents. All
proceedings in connection with the making of the initial Loans or the issuance
of the initial Letters of Credit and the other transactions contemplated by this
Agreement and the other Loan Documents, and all documents incidental hereto and
thereto, shall be reasonably satisfactory to the Collateral Agent
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and its counsel, and the Collateral Agent and such counsel shall have received
all such information and such counterpart originals or certified or other copies
of such documents as the Collateral Agent or such counsel may reasonably
request.
(g) Management Reference Checks. The Collateral Agent
shall have received satisfactory reference checks for key management of each
Loan Party.
(h) Due Diligence. The Agents shall have completed
their business and legal due diligence with respect to each Loan Party and the
results thereof shall be acceptable to the Agents, in their sole and absolute
discretion. Without limiting the foregoing, the Agents shall have received a
Field Survey and Audit, dated not earlier than 30 days prior to the Effective
Date, and such Field Survey and Audit and the results thereof shall be
acceptable to the Agents, in its sole and absolute discretion.
(i) Availability. After giving effect to all Loans to
be made by the Lenders on the Effective Date and the Letters of Credit to be
issued on the Effective Date, (i) the Availability shall not be less than
$5,000,000 and (ii) all liabilities of the Loan Parties shall be current (other
than such liabilities that have been reserved from Availability). The Borrower
shall deliver to the Agents a certificate of the chief financial officer of the
Borrower certifying as to the matters set forth in clauses (i) and (ii) above
and containing the calculation of Availability.
Section 5.02 Conditions Precedent to All Loans and Letters of
Credit. The obligation of any Agent or any Lender to make any Loan or of the
Administrative Agent to assist the Borrower in establishing or opening any
Letter of Credit after the Effective Date is subject to the fulfillment, in a
manner satisfactory to the Administrative Agent, of each of the following
conditions precedent:
(a) Payment of Fees, Etc. The Borrower shall have
paid all fees, costs, expenses and taxes then payable by the Borrower pursuant
to this Agreement and the other Loan Documents, including, without limitation,
Sections 2.06 and 11.04 hereof.
(b) Representations and Warranties; No Event of
Default. The following statements shall be true and correct, and the submission
by the Borrower to the Administrative Agent of a Notice of Borrowing with
respect to each such Loan, and the Borrower's acceptance of the proceeds of such
Loan, or the submission by the Borrower of a Letter of Credit Application with
respect to a Letter of Credit, and the issuance of such Letter of Credit, shall
each be deemed to be a representation and warranty by each Loan Party on the
date of such Loan or the date of issuance of such Letter of Credit that: (i) the
representations and warranties contained in Article VI and in each other Loan
Document, certificate or other writing delivered to any Agent or any Lender
pursuant hereto or thereto on or prior to the date of such Loan or such Letter
of Credit are true and correct on and as of such date as though made on and as
of such date (except to the extent such representations and warranties expressly
refer to an earlier date, in which case they shall be true and correct as of
such earlier date), (ii) at the time of and after giving effect to the making of
such Loan and the application of the proceeds thereof or at the time of issuance
of such Letter of Credit, no Default or Event of Default has occurred and is
continuing or would result from the making of the Loan to be made, or the
issuance of such
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Letter of Credit to be issued, on such date and (iii) the conditions set forth
in this Section 5.02 have been satisfied as of the date of such request.
(c) Legality. The making of such Loan or the issuance
of such Letter of Credit shall not contravene any law, rule or regulation
applicable to any Agent, any Lender or the L/C Issuer.
(d) Notices. The Administrative Agent shall have
received (i) a Notice of Borrowing pursuant to Section 2.02 hereof and (ii) a
Letter of Credit Application pursuant to Section 3.03 hereof.
(e) Delivery of Documents. The Agents shall have
received such other agreements, instruments, approvals, opinions and other
documents, each in form and substance satisfactory to the Agents, as any Agent
may reasonably request.
(f) Proceedings; Receipt of Documents. All
proceedings in connection with the making of such Loan or the issuance of such
Letter of Credit and the other transactions contemplated by this Agreement and
the other Loan Documents, and all documents incidental hereto and thereto, shall
be reasonably satisfactory to the Agents and their counsel, and the Agents and
such counsel shall have received all such information and such counterpart
originals or certified or other copies of such documents, in form and substance
satisfactory to the Agents, as the Agents or such counsel may reasonably
request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
Section 6.01 Representations and Warranties. The Borrower
hereby represents and warrants to the Agents, the Lenders and the L/C Issuer as
follows:
(a) Organization, Good Standing, Etc. Each Loan Party
(i) is a corporation, limited liability company or limited partnership duly
organized, validly existing and in good standing under the laws of the state or
jurisdiction of its organization, (ii) has all requisite power and authority to
conduct its business as now conducted and as presently contemplated and, in the
case of the Borrower, to make the borrowings hereunder, and to execute and
deliver each Loan Document to which it is a party, and to consummate the
transactions contemplated thereby, and (iii) is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the
properties owned or leased by it or in which the transaction of its business
makes such qualification necessary except where all such failures to be
qualified and in good standing could not reasonably be expected to have a
Material Adverse Effect.
(b) Authorization, Etc. The execution, delivery and
performance by each Loan Party of each Loan Document to which it is or will be a
party, (i) have been duly authorized by all necessary action, (ii) do not and
will not contravene its charter or by-laws, its limited liability company or
operating agreement or its certificate of partnership or partnership agreement,
as applicable, or any applicable law or any contractual restriction binding on
or otherwise affecting it or any of its properties, (iii) do not and will not
result in or require the
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creation of any Lien (other than pursuant to any Loan Document) upon or with
respect to any of its properties, and (iv) do not and will not result in any
default, noncompliance, suspension, revocation, impairment, forfeiture or
nonrenewal of any permit, license, authorization or approval applicable to its
operations or any of its properties except where all such defaults,
noncompliance, suspensions, revocations, impairments, forfeitures and
nonrenewals could not reasonably be expected to have a Material Adverse Effect.
(c) Governmental Approvals. No authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority is required in connection with the due execution, delivery and
performance by any Loan Party of any Loan Document to which it is or will be a
party, except (i) for recordings and filings in connection with the Liens
granted to the Collateral Agent under the Loan Documents, (ii) those obtained or
made on or prior to the Effective Date and (iii) any filings required to be made
by the Loan Parties after the Effective Date in the ordinary course of business
of such Loan Parties.
(d) Enforceability of Loan Documents. This Agreement
is, and each other Loan Document to which any Loan Party is or will be a party,
when delivered hereunder, will be, a legal, valid and binding obligation of such
Person, enforceable against such Person in accordance with its terms, except as
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws.
(e) Subsidiaries. Schedule 6.01(e) is a complete and
correct description of the name, jurisdiction of incorporation and ownership of
the outstanding Capital Stock of each Loan Party and the Subsidiaries of each
Loan Party in existence on the date hereof. Except as indicated on such
Schedule, (i) all of the issued and outstanding shares of such Capital Stock
have been validly issued and are fully paid and nonassessable, and the holders
thereof are not entitled to any preemptive, first refusal or other similar
rights, (ii) all such Capital Stock is owned by the respective equityholders,
free and clear of all Liens, and (iii) there are no outstanding debt or equity
securities of any Loan Party or any of its Subsidiaries and no outstanding
obligations of any Loan Party or any of its Subsidiaries convertible into or
exchangeable for, or warrants, options or other rights for the purchase or
acquisition from such Loan Party or any of its Subsidiaries, or other
obligations of any Loan Party or any of its Subsidiaries to issue, directly or
indirectly, any shares of Capital Stock of such Loan Party or any of its
Subsidiaries.
(f) Litigation; Commercial Tort Claims. Except as set
forth in Schedule 6.01(f), (i) there is no pending or, to the best knowledge of
any Loan Party, threatened action, suit or proceeding affecting any Loan Party
before any court or other Governmental Authority or any arbitrator that (A) if
adversely determined, could have a Material Adverse Effect or (B) relates to
this Agreement or any other Loan Document or any transaction contemplated hereby
or thereby and (ii) as of the Effective Date, none of the Loan Parties holds any
commercial tort claims in respect of which a claim has been filed in a court of
law or a written notice by an attorney has been given to a potential defendant.
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(g) Financial Condition.
(i) The Financial Statements, copies of
which have been delivered to each Agent and each Lender, fairly present in all
material respects the consolidated financial condition of the Borrower and its
Subsidiaries as at the respective dates thereof and the consolidated results of
operations of the Borrower and its Subsidiaries for the fiscal periods ended on
such respective dates, all in accordance with GAAP, and since September 30,
2001, no event or development has occurred that has had or could have a Material
Adverse Effect. The Financial Statements for the twelve months ended September
30, 2001 establish a Consolidated EBITDA of the Borrower and its Subsidiaries of
not less than $49,500,000.
(ii) The Borrower has heretofore furnished
to each Agent and each Lender (A) projected monthly balance sheets, income
statements and statements of cash flows of the Borrower and its Subsidiaries for
the period from November 2001, through December 2004, and (B) projected annual
balance sheets, income statements and statements of cash flows of the Borrower
and its Subsidiaries for the Fiscal Years ending in December 2002 through
December 2004, which projected financial statements shall be updated from time
to time pursuant to Section 7.01(a)(vii). Such projections, as so updated, shall
be believed by the Borrower at the time furnished to be reasonable, shall have
been prepared on a reasonable basis and in good faith by the Borrower, and shall
have been based on assumptions believed by the Borrower to be reasonable at the
time made and upon the information then reasonably available to the Borrower,
and the Borrower shall not be aware of any facts or information that would lead
it to believe that such projections, as so updated, are incorrect or misleading
in any material respect.
(h) Compliance with Law, Etc. No Loan Party is in
violation of its organizational documents, any material law, rule, regulation,
judgment or order of any Governmental Authority applicable to it or any of its
property or assets, or any material term of any material agreement or instrument
(including, without limitation, any Material Contract) binding on or otherwise
affecting it or any of its properties, and no Default or Event of Default has
occurred and is continuing.
(i) ERISA. Except as set forth on Schedule 6.01(i),
(i) each Employee Plan is in substantial compliance with ERISA and the Internal
Revenue Code, (ii) no Termination Event has occurred nor is reasonably expected
to occur with respect to any Employee Plan, (iii) the most recent annual report
(Form 5500 Series) with respect to each Employee Plan, including any required
Schedule B (Actuarial Information) thereto, copies of which have been filed with
the Internal Revenue Service and delivered to the Agents, is complete and
correct and fairly presents the funding status of such Employee Plan, and since
the date of such report there has been no material adverse change in such
funding status, (iv) copies of each agreement entered into with the PBGC, the
U.S. Department of Labor or the Internal Revenue Service with respect to any
Employee Plan have been delivered to the Agents, (v) no Employee Plan had an
accumulated or waived funding deficiency or permitted decrease which would
create a deficiency in its funding standard account or has applied for an
extension of any amortization period within the meaning of Section 412 of the
Internal Revenue Code at any time during the previous 60 months, and (vi) no
Lien imposed under the Internal Revenue Code or ERISA exists or is likely to
arise on account of any Employee Plan within the meaning of Section 412 of the
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Internal Revenue Code. Except as set forth on Schedule 6.01(i), no Loan Party or
any of its ERISA Affiliates has incurred any withdrawal liability under ERISA
with respect to any Multiemployer Plan, or is aware of any facts indicating that
it or any of its ERISA Affiliates may in the future incur any such withdrawal
liability. No Loan Party or any of its ERISA Affiliates nor any fiduciary of any
Employee Plan has, with respect to any such Employee Plan, (i) engaged in a
nonexempt prohibited transaction described in Sections 406 of ERISA or 4975 of
the Internal Revenue Code, (ii) failed to pay any required installment or other
payment required under Section 412 of the Internal Revenue Code on or before the
due date for such required installment or payment, (iii) engaged in a
transaction within the meaning of Section 4069 of ERISA or (iv) incurred any
liability to the PBGC which remains outstanding other than the payment of
premiums, and there are no premium payments which have become due which are
unpaid. There are no pending or, to the best knowledge of any Loan Party,
threatened claims, actions, proceedings or lawsuits (other than claims for
benefits in the normal course) asserted or instituted against (i) any Employee
Plan or its assets, (ii) any fiduciary with respect to any Employee Plan, or
(iii) any Loan Party or any of its ERISA Affiliates with respect to any Employee
Plan. Except as required by Section 4980B of the Internal Revenue Code or any
other applicable laws or as disclosed on Schedule 6.01(i), no Loan Party or any
of its ERISA Affiliates maintains an employee welfare benefit plan (as defined
in Section 3(1) of ERISA) which provides health or welfare benefits (through the
purchase of insurance or otherwise) for any retired or former employee of any
Loan Party or any of its ERISA Affiliates or coverage after a participant's
termination of employment.
(j) Taxes, Etc. All Federal, state and local tax
returns and other reports required by applicable law to be filed by any Loan
Party have been filed, or extensions have been obtained, and all taxes,
assessments and other governmental charges imposed upon any Loan Party or any
property of any Loan Party and which have become due and payable on or prior to
the date hereof have been paid, except to the extent contested in good faith by
proper proceedings which stay the imposition of any penalty, fine or Lien
resulting from the non-payment thereof and with respect to which adequate
reserves have been set aside for the payment thereof in accordance with GAAP.
(k) Regulations T, U and X. No Loan Party is or will
be engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation T, U or X), and no
proceeds of any Loan will be used to purchase or carry any margin stock or to
extend credit to others for the purpose of purchasing or carrying any margin
stock.
(l) Nature of Business. No Loan Party is engaged in
any business in any material respect other than the bottled water business, the
dry and cold storage business, the manufacture and delivery of ice and the sale
and lease of ice manufacturing equipment.
(m) Adverse Agreements, Etc. No Loan Party is a party
to any agreement or instrument, or subject to any charter, limited liability
company agreement, partnership agreement or other corporate, partnership or
limited liability company restriction or any judgment, order, regulation, ruling
or other requirement of a court or other Governmental Authority, which has, or
in the future could reasonably be expected to have, a Material Adverse Effect.
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(n) Permits, Etc. Each Loan Party has, and is in
compliance with, all permits, licenses, authorizations, approvals, entitlements
and accreditations required for such Person lawfully to own, lease, manage or
operate, or to acquire, each business currently owned, leased, managed or
operated, or to be acquired, by such Person except where all such failures and
non-compliances could not reasonably be expected to have a Material Adverse
Effect. No condition exists or event has occurred which, in itself or with the
giving of notice or lapse of time or both, would result in the suspension,
revocation, impairment, forfeiture or non-renewal of any such permit, license,
authorization, approval, entitlement or accreditation, and there is no claim
that any thereof is not in full force and effect except where all such
suspensions, revocations, impairments, forfeitures and non-renewals could not
reasonably be expected to have a Material Adverse Effect.
(o) Properties. (i) Each Loan Party has good and
indefeasible title to, valid leasehold interests in, or valid licenses to use,
all property and assets material to its business, free and clear of all Liens,
except Permitted Liens. All such properties and assets are in good working order
and condition, ordinary wear and tear excepted.
(ii) Schedule 6.01(o) sets forth a complete
and accurate list, as of the Effective Date, of the location, by state and
street address, of all real property owned or leased by each Loan Party. As of
the Effective Date, each Loan Party has valid leasehold interests in the Leases
described on Schedule 6.01(o) to which it is a party. Schedule 6.01(o) sets
forth with respect to each such Lease, the commencement date, termination date,
renewal options (if any) and annual base rents. Each such Lease is valid and
enforceable in accordance with its terms in all material respects and is in full
force and effect. No consent or approval of any landlord or other third party in
connection with any such Lease is necessary for any Loan Party to enter into and
execute the Loan Documents to which it is a party, except as set forth on
Schedule 6.01(o). To the best knowledge of any Loan Party, no other party to any
such Lease is in default of its obligations thereunder (except as disclosed on
Schedule 6.01(o)), and no Loan Party (or any other party to any such Lease) has
at any time delivered or received any notice of default which remains uncured
under any such Lease and, as of the Effective Date, no event has occurred which,
with the giving of notice or the passage of time or both, would constitute a
default under any such Lease.
(p) Full Disclosure. Each Loan Party has disclosed to
the Agents all agreements, instruments and corporate or other restrictions to
which it is subject, and all other matters known to it, that, individually or in
the aggregate, could reasonably be expected to result in a Material Adverse
Effect. None of the other reports, financial statements, certificates, schedules
or other information furnished by or on behalf of any Loan Party to the Agents
in connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which it
was made, not misleading; provided that, with respect to projected financial
information, each Loan Party represents only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time.
There is no contingent liability or fact that may have a Material Adverse Effect
which has not been set forth in a footnote included in the Financial Statements
or a Schedule hereto.
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(q) Operating Lease Obligations. On the Effective
Date, none of the Loan Parties has any Operating Lease Obligations other than
the Operating Lease Obligations set forth on Schedule 6.01(q).
(r) Environmental Matters. Except as set forth on
Schedule 6.01(r), (i) the operations of each Loan Party are in compliance in all
material respects with all Environmental Laws; (ii) there has been no Release at
any of the properties owned or operated by any Loan Party or a predecessor in
interest, or, to each Loan Party's best knowledge, at any disposal or treatment
facility which received Hazardous Materials generated by any Loan Party or any
predecessor in interest which could have a Material Adverse Effect; (iii) no
Environmental Action has been asserted against any Loan Party or any predecessor
in interest nor does any Loan Party have knowledge or notice of any threatened
or pending Environmental Action against any Loan Party or any predecessor in
interest which could have a Material Adverse Effect; (iv) to each Loan Party's
best knowledge no Environmental Actions have been asserted against any
facilities that may have received Hazardous Materials generated by any Loan
Party or any predecessor in interest which could have a Material Adverse Effect;
(v) no property now or formerly owned, operated or occupied by a Loan Party has
been used as a treatment or disposal site for any Hazardous Material; (vi) there
are no underground storage tanks at any of the currently owned or operated
properties; (vii) there are no operating production ▇▇▇▇▇ at any of the
currently owned or operated properties; (viii) there are no Remedial Actions at
any of the currently or formerly owned or operated properties requiring any Loan
Party to incur any Environmental Liabilities and Costs in an aggregate amount in
excess of $500,000; (ix) no Loan Party has failed to report to the proper
Governmental Authority the occurrence of any Release which is required to be so
reported by any Environmental Laws which could have a Material Adverse Effect;
(x) each Loan Party holds all licenses, permits and approvals required under any
Environmental Laws in connection with the operation of the business carried on
by it, except for such licenses, permits and approvals as to which a Loan
Party's failure to maintain or comply with could not have a Material Adverse
Effect; and (xi) no Loan Party has received any notification pursuant to any
Environmental Laws that (A) Capital Expenditures are required to be made in
respect of a condition of continued compliance with any Environmental Laws, or
any license, permit or approval issued pursuant thereto or (B) any license,
permit or approval referred to above is about to be subject to new limitations
or conditions, revoked, withdrawn or terminated, in each case, except as could
not have a Material Adverse Effect.
(s) Insurance. Each Loan Party keeps its property
adequately insured and maintains (i) insurance to such extent and against such
risks, including fire, as is customary with companies in the same or similar
businesses, (ii) workmen's compensation insurance in the amount required by
applicable law, (iii) public liability insurance, which shall include product
liability insurance, in the amount customary with companies in the same or
similar business against claims for personal injury or death on properties
owned, occupied or controlled by it, and (iv) such other insurance as may be
required by law or as may be reasonably required by the Collateral Agent
(including, without limitation, against larceny, embezzlement or other criminal
misappropriation). Schedule 6.01(s) sets forth a list of all insurance
maintained by each Loan Party on the Effective Date.
(t) Use of Proceeds. The proceeds of the Loans shall
be used to (i) purchase the Existing Indebtedness of the Borrower under the
Existing Credit Agreement in the
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principal amount of up to $62,000,000, (ii) pay fees and expenses in connection
with the transactions contemplated hereby, (iii) fund working capital of the
Borrower, and (iv) subject to the terms and conditions of Section 7.02(m), to
purchase or redeem the Senior Notes of the Borrower. The Letters of Credit will
be used for general working capital purposes.
(u) Solvency. After giving effect to the transactions
contemplated by this Agreement and before and after giving effect to each Loan
and Letter of Credit, each Loan Party is, and the Loan Parties on a consolidated
basis are, Solvent.
(v) Location of Bank Accounts. Schedule 6.01(v) sets
forth a complete and accurate list as of the Effective Date of all deposit,
checking and other bank accounts, all securities and other accounts maintained
with any broker dealer and all other similar accounts maintained by each Loan
Party, together with a description thereof (i.e., the bank or broker dealer at
which such deposit or other account is maintained and the account number and the
purpose thereof).
(w) Intellectual Property. Except as set forth on
Schedule 6.01(w), each Loan Party owns or licenses or otherwise has the right to
use all licenses, permits, patents, patent applications, trademarks, trademark
applications, service marks, tradenames, copyrights, copyright applications,
franchises, authorizations, non-governmental licenses and permits and other
intellectual property rights that are necessary for the operation of its
business, without infringement upon or conflict with the rights of any other
Person with respect thereto, except for such infringements and conflicts which,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect. Set forth on Schedule 6.01(w) is a complete and
accurate list as of the Effective Date of all such material licenses, permits,
patents, patent applications, trademarks, trademark applications, service marks,
tradenames, copyrights, copyright applications, franchises, authorizations,
non-governmental licenses and permits and other intellectual property rights of
each Loan Party. No slogan or other advertising device, product, process,
method, substance, part or other material now employed, or now contemplated to
be employed, by any Loan Party infringes upon or conflicts with any rights owned
by any other Person, and no claim or litigation regarding any of the foregoing
is pending or threatened, except for such infringements and conflicts which
could not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect. To the best knowledge of each Loan Party, no patent,
invention, device, application, principle or any statute, law, rule, regulation,
standard or code is pending or proposed, which, individually or in the
aggregate, could have a Material Adverse Effect.
(x) Material Contracts. Set forth on Schedule 6.01(x)
is a complete and accurate list as of the Effective Date of all Material
Contracts of each Loan Party, showing the parties and subject matter thereof and
amendments and modifications thereto. Each such Material Contract (i) is in full
force and effect and is binding upon and enforceable against each Loan Party
that is a party thereto and, to the best knowledge of such Loan Party, all other
parties thereto in accordance with its terms, (ii) has not been otherwise
amended or modified, and (iii) is not in default due to the action of any Loan
Party or, to the best knowledge of any Loan Party, any other party thereto.
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(y) Holding Company and Investment Company Acts. None
of the Loan Parties is (i) a "holding company" or a "subsidiary company" of a
"holding company" or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935, as amended, or (ii)
an "investment company" or an "affiliated person" or "promoter" of, or
"principal underwriter" of or for, an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended.
(z) Employee and Labor Matters. There is (i) no
unfair labor practice complaint pending or, to the best knowledge of any Loan
Party, threatened against any Loan Party before any Governmental Authority and
no grievance or arbitration proceeding pending or threatened against any Loan
Party which arises out of or under any collective bargaining agreement, (ii) no
strike, labor dispute, slowdown, stoppage or similar action or grievance pending
or threatened against any Loan Party or (iii) to the best knowledge of any Loan
Party, no union representation question existing with respect to the employees
of any Loan Party and no union organizing activity taking place with respect to
any of the employees of any Loan Party. No Loan Party or any of its ERISA
Affiliates has incurred any liability or obligation under the Worker Adjustment
and Retraining Notification Act ("WARN") or similar state law, which remains
unpaid or unsatisfied. The hours worked and payments made to employees of any
Loan Party have not been in violation of the Fair Labor Standards Act or any
other applicable legal requirements, except to the extent such violations could
not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect. All material payments due from any Loan Party on
account of wages and employee health and welfare insurance and other benefits
have been paid or accrued as a liability on the books of such Loan Party, except
where the failure to do so could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(aa) Customers and Suppliers. There exists no actual
or threatened termination, cancellation or limitation of, or modification to or
change in, the business relationship between (i) any Loan Party, on the one
hand, and any customer or any group thereof, on the other hand, whose agreements
with any Loan Party are individually or in the aggregate material to the
business or operations of such Loan Party, or (ii) any Loan Party, on the one
hand, and any material supplier thereof, on the other hand; and there exists no
present state of facts or circumstances that could give rise to or result in any
such termination, cancellation, limitation, modification or change, in each such
case which could reasonably be expected to have a Material Adverse Effect.
(bb) Name; Jurisdiction of Organization;
Organizational ID Number; Chief Place of Business; Chief Executive Office; FEIN.
Schedule 6.01(bb) sets forth a complete and accurate list as of the date hereof
of (i) the exact legal name of each Loan Party, (ii) the jurisdiction of
organization of each Loan Party, (iii) the organizational identification number
of each Loan Party (or indicates that such Loan Party has no organizational
identification number), (iv) each place of business of each Loan Party, (v) the
chief executive office of each Loan Party and (vi) the federal employer
identification number of each Loan Party.
(cc) Tradenames. Schedule 6.01(cc) hereto sets forth
a complete and accurate list as of the Effective Date of all tradenames used by
each Loan Party.
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(dd) Locations of Collateral. On the Effective Date,
there is no location at which any Loan Party has any Ice Factories or owns or
leases any real property other than those locations listed on Schedule 6.01(dd).
(ee) Security Interests. Each Security Agreement
creates in favor of the Collateral Agent, for the benefit of the Lenders, a
legal, valid and enforceable security interest in the Collateral secured
thereby. Upon the filing of the UCC-1 financing statements described in Section
5.01(d)(viii) and the recording of the Collateral Assignments for Security
referred to in each Security Agreement in the United States Patent and Trademark
Office and the United States Copyright Office, as applicable, such security
interests in and Liens on the Collateral granted thereby shall be perfected,
first priority security interests, and no further recordings or filings are or
will be required in connection with the creation, perfection or enforcement of
such security interests and Liens, other than (i) the filing of continuation
statements in accordance with applicable law, (ii) the recording of the
Collateral Assignments for Security pursuant to each Security Agreement in the
United States Patent and Trademark Office and the United States Copyright
Office, as applicable, with respect to after-acquired U.S. patent and trademark
applications and registrations and U.S. copyrights and (iii) the recordation of
appropriate evidence of the security interest in the appropriate foreign
registry with respect to all foreign intellectual property.
(ff) Representations and Warranties in Documents; No
Default. All representations and warranties set forth in this Agreement and the
other Loan Documents are true and correct in all respects at the time as of
which such representations were made and on the Effective Date. No Event of
Default has occurred and is continuing and no condition exists which constitutes
a Default or an Event of Default.
(gg) Senior Notes. The Obligations constitute
"Permitted Indebtedness" as defined in the Senior Notes.
(hh) Subsidiary Notes. Each Subsidiary Note evidences
amounts that were borrowed by the Borrower under the Existing Credit Agreement,
the proceeds of which were loaned by the Borrower to the Subsidiary Guarantors.
All amounts evidenced by each Subsidiary Note is due and owing in accordance
with the terms of such Subsidiary Note without any defense, deduction, offset or
counterclaim.
(ii) Net Orderly Liquidation Value. The sample of
Eligible Equipment that was appraised to determine the Net Orderly Liquidation
Value of such Eligible Equipment for the Effective Date is a representative
sample of the quality, condition and age of all Eligible Equipment on the
Effective Date.
ARTICLE VII
COVENANTS
Section 7.01 Affirmative Covenants. So long as any principal
of or interest on any Loan, Reimbursement Obligation, Letter of Credit
Obligation or any other Obligation
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(whether or not due) shall remain unpaid or any Lender shall have any Commitment
hereunder, the Borrower will, unless the Required Lenders shall otherwise
consent in writing:
(a) Reporting Requirements. Furnish to each Agent and
each Lender:
(i) as soon as available and in any event
within 45 days after the end of each of the first three fiscal quarters of the
Borrower commencing March 31, 2002, consolidated and consolidating balance
sheets, consolidated and consolidating statements of operations and retained
earnings and consolidated statements of cash flows of the Borrower and its
Subsidiaries as at the end of such quarter, and for the period commencing at the
end of the immediately preceding Fiscal Year and ending with the end of such
quarter, setting forth in each case in comparative form the figures for the
corresponding date or period of the immediately preceding Fiscal Year, all in
reasonable detail and certified by an Authorized Officer of the Borrower as
fairly presenting, in all material respects, the financial position of the
Borrower and its Subsidiaries as of the end of such quarter and the results of
operations and cash flows of the Borrower and its Subsidiaries for such quarter,
in accordance with GAAP applied in a manner consistent with that of the most
recent audited financial statements of the Borrower and its Subsidiaries
furnished to the Agents and the Lenders, subject to normal year-end adjustments
and the absence of footnotes;
(ii) as soon as available, and in any event
within 90 days after the end of each Fiscal Year of the Borrower and its
Subsidiaries, consolidated and consolidating balance sheets, consolidated and
consolidating statements of operations and retained earnings and consolidated
statements of cash flows of the Borrower and its Subsidiaries as at the end of
such Fiscal Year, setting forth in each case in comparative form the
corresponding figures for the immediately preceding Fiscal Year, all in
reasonable detail and prepared in accordance with GAAP, and accompanied by a
report and an unqualified opinion, prepared in accordance with generally
accepted auditing standards, of independent certified public accountants of
recognized standing selected by the Borrower and satisfactory to the Agents
(which opinion shall be without (A) a "going concern" or like qualification or
exception, (B) any qualification or exception as to the scope of such audit, or
(C) any qualification which relates to the treatment or classification of any
item and which, as a condition to the removal of such qualification, would
require an adjustment to such item, the effect of which would be to cause any
noncompliance with the provisions of Section 7.03), together with a written
statement of such accountants (1) to the effect that, in making the examination
necessary for their certification of such financial statements, they have not
obtained any knowledge of the existence of an Event of Default or a Default and
(2) if such accountants shall have obtained any knowledge of the existence of an
Event of Default or such Default, describing the nature thereof;
(iii) as soon as available, and in any event
within 30 days after the end of each fiscal month of the Borrower and its
Subsidiaries commencing November 30, 2001, internally prepared consolidated and
consolidating balance sheets, consolidated and consolidating statements of
operations and retained earnings and consolidated statements of cash flows as at
the end of such fiscal month, and for the period commencing at the end of the
immediately preceding Fiscal Year and ending with the end of such fiscal month,
all in reasonable detail and certified by an Authorized Officer of the Borrower
as fairly presenting, in all material respects, the financial position of the
Borrower and its Subsidiaries as at the end of
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such fiscal month and the results of operations, retained earnings and cash
flows of the Borrower and its Subsidiaries for such fiscal month, in accordance
with GAAP applied in a manner consistent with that of the most recent audited
financial statements furnished to the Agents and the Lenders, subject to normal
year-end adjustments and the absence of footnotes;
(iv) simultaneously with the delivery of the
financial statements of the Borrower and its Subsidiaries required by clauses
(i), (ii) and (iii) of this Section 7.01(a), a certificate of an Authorized
Officer of the Borrower (A) stating that such Authorized Officer has reviewed
the provisions of this Agreement and the other Loan Documents and has made or
caused to be made under his or her supervision a review of the condition and
operations of the Borrower and its Subsidiaries during the period covered by
such financial statements with a view to determining whether the Borrower and
its Subsidiaries were in compliance with all of the provisions of this Agreement
and such Loan Documents at the times such compliance is required hereby and
thereby, and that such review has not disclosed, and such Authorized Officer has
no knowledge of, the existence during such period of an Event of Default or
Default or, if an Event of Default or Default existed, describing the nature and
period of existence thereof and the action which the Borrower and its
Subsidiaries propose to take or have taken with respect thereto and (B)
attaching a schedule showing the calculations specified in Section 7.03;
(v) as soon as available and in any event
within 15 days after the end of each fiscal month of the Borrower and its
Subsidiaries commencing January 15, 2002, reports in form and detail
satisfactory to the Agents and certified by an Authorized Officer of the
Borrower as being accurate and complete (A) listing all Accounts Receivable of
the Borrower as of such day, which shall include the amount and age of each
Account Receivable, showing separately those which are more than 30, 60, 90 and
120 days old and a description of all Liens, set-offs, defenses and
counterclaims with respect thereto, together with a reconciliation of such
schedule with the schedule delivered to the Agents pursuant to this clause
(v)(A) for the immediately preceding fiscal month, the name and mailing address
of each Account Debtor with respect to each such Account Receivable and such
other information as any Agent may reasonably request, (B) listing all accounts
payable of the Borrower as of each such day which shall include the amount and
age of each account payable, the name and mailing address of each account
creditor and such other information as any Agent may reasonably request, (C) an
Equipment summary report (differentiating with respect to Ice Factories and all
other Equipment) indicating changes in value which shall include, without
limitation, purchases, additions, deletions and accumulated depreciation, (D)
upon request by any Agent, copies of invoices in connection with the Accounts,
customer statements, credit memos, remittance advices and reports, deposit
slips, shipping and delivery documents in connection with the Accounts and, for
Inventory and Equipment acquired by the Borrower or any Subsidiary, purchase
orders and invoices, (E) upon request by any Agent, a statement of the balance
of each of the intercompany Accounts, (F) such information and reports relating
to real estate as any Agent shall reasonably request from time to time, and (G)
with respect to the Ice Factories, a certificate setting forth, as of the end of
the previous fiscal month and for the portion of the fiscal year then ended, (u)
the number of Ice Factories purchased by the Borrower and its Subsidiaries
during such period, (w) the number of additional Ice Factories leased by the
Borrower and its Subsidiaries during such period, (x) the number of Ice
Factories installed by the Borrower and its Subsidiaries during such period, (y)
the dollar amount spent on the purchase of Ice Factories
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during such period, and (z) any other information relating to the Ice Factories
as the Agents may reasonably request;
(vi) as soon as available and in any event
within 4 Business Days after the end of each week commencing with the first week
ending after the Effective Date, a Borrowing Base Certificate, current as of the
close of business on the Friday of the immediately preceding week, supported by
schedules showing the derivation thereof and containing such detail and other
information as any Agent may reasonably request from time to time, provided that
(A) the Borrowing Base set forth in the Borrowing Base Certificate shall be
effective from and including the date such Borrowing Base Certificate is duly
received by the Agents but not including the date on which a subsequent
Borrowing Base Certificate is received by the Agents, unless any Agent disputes
the eligibility of any property included in the calculation of the Borrowing
Base or the valuation thereof by notice of such dispute to the Borrower and (B)
in the event of any dispute about the eligibility of any property included in
the calculation of the Borrowing Base or the valuation thereof, such Agent's
good faith judgment shall control;
(vii) on or before November 30 of each year,
financial projections, supplementing and superseding the financial projections
for such period referred to in Section 6.01(g)(ii)(A), prepared on a monthly
basis and otherwise in form and substance satisfactory to the Agents, for the
immediately succeeding Fiscal Year for the Borrower and its Subsidiaries, all
such financial projections to be reasonable, to be prepared on a reasonable
basis and in good faith, and to be based on assumptions believed by the Borrower
to be reasonable at the time made and from the information then available to the
Borrower;
(viii) promptly after submission to any
Governmental Authority, all documents and information furnished to such
Governmental Authority in connection with any investigation of any Loan Party
other than routine inquiries by such Governmental Authority;
(ix) as soon as possible, and in any event
within 3 Business Days after the occurrence of an Event of Default or Default or
the occurrence of any event or development that could reasonably be expected to
have a Material Adverse Effect, the written statement of an Authorized Officer
of the Borrower setting forth the details of such Event of Default or Default or
other event or development having a Material Adverse Effect and the action which
the affected Loan Party proposes to take with respect thereto;
(x) (A) as soon as possible and in any event
within 10 days after any Loan Party or any ERISA Affiliate thereof knows or has
reason to know that (1) any Reportable Event with respect to any Employee Plan
has occurred, (2) any other Termination Event with respect to any Employee Plan
has occurred, or (3) an accumulated funding deficiency has been incurred or an
application has been made to the Secretary of the Treasury for a waiver or
modification of the minimum funding standard (including installment payments) or
an extension of any amortization period under Section 412 of the Internal
Revenue Code with respect to an Employee Plan, a statement of an Authorized
Officer of the Borrower setting forth the details of such occurrence and the
action, if any, which such Loan Party or such ERISA Affiliate proposes to take
with respect thereto, (B) promptly and in any event within three days after
receipt thereof by any Loan Party or any ERISA Affiliate thereof from the PBGC,
copies of
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each notice received by any Loan Party or any ERISA Affiliate thereof of the
PBGC's intention to terminate any Employee Plan or to have a trustee appointed
to administer any Employee Plan, (C) promptly and in any event within 10 days
after the filing thereof with the Internal Revenue Service if requested by any
Agent, copies of each Schedule B (Actuarial Information) to the annual report
(Form 5500 Series) with respect to each Employee Plan and Multiemployer Plan,
(D) promptly and in any event within 10 days after any Loan Party or any ERISA
Affiliate thereof knows or has reason to know that a required installment within
the meaning of Section 412 of the Internal Revenue Code has not been made when
due with respect to an Employee Plan, (E) promptly and in any event within 3
days after receipt thereof by any Loan Party or any ERISA Affiliate thereof from
a sponsor of a Multiemployer Plan or from the PBGC, a copy of each notice
received by any Loan Party or any ERISA Affiliate thereof concerning the
imposition or amount of withdrawal liability under Section 4202 of ERISA or
indicating that such Multiemployer Plan may enter reorganization status under
Section 4241 of ERISA, and (F) promptly and in any event within 10 days after
any Loan Party or any ERISA Affiliate thereof sends notice of a plant closing or
mass layoff (as defined in WARN) to employees, copies of each such notice sent
by such Loan Party or such ERISA Affiliate thereof;
(xi) promptly after the commencement thereof
but in any event not later than 5 days after service of process with respect
thereto on, or the obtaining of knowledge thereof by, any Loan Party, notice of
each action, suit or proceeding before any court or other Governmental Authority
or other regulatory body or any arbitrator which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect;
(xii) as soon as possible and in any event
within 5 days after execution, receipt or delivery thereof, copies of any
material notices that any Loan Party executes or receives in connection with any
Material Contract;
(xiii) as soon as possible and in any event
within 5 days after execution, receipt or delivery thereof, copies of any
material notices that any Loan Party executes or receives in connection with the
sale or other Disposition of the Capital Stock of, or all or substantially all
of the assets of, any Loan Party;
(xiv) promptly after the sending or filing
thereof, copies of all statements, reports and other information any Loan Party
sends to any holders of its Indebtedness or its securities as such or files with
the SEC or any national (domestic or foreign) securities exchange;
(xv) promptly upon receipt thereof, copies
of all financial reports (including, without limitation, management letters), if
any, submitted to any Loan Party by its auditors in connection with any annual
or interim audit of the books thereof; and
(xvi) promptly upon request, such other
information concerning the condition or operations, financial or otherwise, of
any Loan Party as any Agent may from time to time may reasonably request.
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(b) Additional Guaranties and Collateral Security.
Cause:
(i) each Subsidiary of any Loan Party not in
existence on the Effective Date, to execute and deliver to the Collateral Agent
promptly and in any event on the date of any Permitted Acquisition and otherwise
within 10 days after the formation, acquisition or change in status thereof (A)
a Guaranty guaranteeing the Obligations, (B) a Security Agreement, (C) if such
Subsidiary has any Subsidiaries, a Pledge Agreement together with (x)
certificates evidencing all of the Capital Stock of any Person owned by such
Subsidiary, (y) undated stock powers executed in blank, and (z) such opinion of
counsel and such approving certificate of such Subsidiary as the Collateral
Agent may reasonably request in respect of complying with any legend on any such
certificate or any other matter relating to such shares, (D) one or more
Mortgages creating on the real property of such Subsidiary a perfected, first
priority Lien on such real property, a Title Insurance Policy covering such real
property, if available, a current ALTA survey thereof and a surveyor's
certificate, each in form and substance reasonably satisfactory to the
Collateral Agent, together with such other agreements, instruments and documents
as the Collateral Agent may reasonably require whether comparable to the
documents required under Section 7.01(o) or otherwise, and (E) such other
agreements, instruments, approvals, legal opinions or other documents reasonably
requested by the Collateral Agent in order to create, perfect, establish the
first priority of or otherwise protect any Lien purported to be covered by any
such Security Agreement, Pledge Agreement or Mortgage or otherwise to effect the
intent that such Subsidiary shall become bound by all of the terms, covenants
and agreements contained in the Loan Documents and that all property and assets
of such Subsidiary shall become Collateral for the Obligations; and
(ii) each owner of the Capital Stock of any
such Subsidiary to execute and deliver promptly and in any event on the date of
any Permitted Acquisition and otherwise within 10 days after the formation or
acquisition of such Subsidiary a Pledge Agreement, together with (A)
certificates evidencing all of the Capital Stock of such Subsidiary, (B) undated
stock powers or other appropriate instruments of assignment executed in blank
with signature guaranteed, (C) such opinion of counsel and such approving
certificate of such Subsidiary as the Collateral Agent may reasonably request in
respect of complying with any legend on any such certificate or any other matter
relating to such shares and (D) such other agreements, instruments, approvals,
legal opinions or other documents reasonably requested by the Collateral Agent.
(c) Compliance with Laws, Etc. Comply, and cause each
of its Subsidiaries to comply, in all material respects with all applicable
material laws, rules, regulations and orders (including, without limitation, all
applicable Environmental Laws), such compliance to include, without limitation,
(i) paying before the same become delinquent all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
upon any of its properties, and (ii) paying all lawful claims which if unpaid
might become a Lien or charge upon any of its properties, except, in each case,
to the extent contested in good faith by proper proceedings which stay the
imposition of any penalty, fine or Lien resulting from the non-payment thereof
and with respect to which adequate reserves have been set aside for the payment
thereof in accordance with GAAP.
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(d) Preservation of Existence, Etc. Except as
permitted by Section 7.02(c), maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, its existence, rights and privileges, and
become or remain, and cause each of its Subsidiaries to become or remain, duly
qualified and in good standing in each jurisdiction in which the character of
the properties owned or leased by it or in which the transaction of its business
makes such qualification necessary, except where the failure to remain qualified
and in good standing could not reasonably be expected to result in a Material
Adverse Effect.
(e) Keeping of Records and Books of Account. Keep,
and cause each of its Subsidiaries to keep, adequate records and books of
account, with complete entries made to permit the preparation of financial
statements in accordance with GAAP.
(f) Inspection Rights. Permit, and cause each of its
Subsidiaries to permit, the agents and representatives of any Agent at any time
and from time to time during normal business hours, at the expense of the
Borrower, to examine and make copies of and abstracts from its records and books
of account, to visit and inspect its properties, to verify materials, leases,
notes, accounts receivable, deposit accounts and its other assets, to conduct
audits, physical counts, valuations, appraisals, Phase I Environmental Site
Assessments (and, if requested by the Collateral Agent based upon the results of
any such Phase I Environmental Site Assessment, a Phase II Environmental Site
Assessment) or examinations and to discuss its affairs, finances and accounts
with any of its directors, officers, managerial employees, independent
accountants or any of its other representatives, provided that, in the absence
of a continuing Event of Default, the Agents shall not conduct more than (i) one
appraisal or valuation of the Ice Factories or other Eligible Equipment in any
calendar year and (ii) one Phase I Environmental Site Assessment for each parcel
of Real Property in any calendar year.
(g) Maintenance of Properties, Etc. Maintain and
preserve, and cause each of its Subsidiaries to maintain and preserve, all of
its properties (including, without limitation, the Ice Factories and other
Equipment) which are necessary or useful in the proper conduct of its business
in good working order and condition, ordinary wear and tear excepted, and
comply, and cause each of its Subsidiaries to comply, at all times with the
provisions of all leases to which it is a party as lessee or under which it
occupies property, so as to prevent any loss or forfeiture thereof or
thereunder. The Borrower shall promptly inform the Agents of any material
additions to or deletions from the properties.
(h) Maintenance of Insurance. Maintain, and cause
each of its Subsidiaries to maintain, insurance with responsible and reputable
insurance companies or associations (including, without limitation,
comprehensive general liability, hazard, rent and business interruption
insurance) with respect to its properties (including all real properties leased
or owned by it) and business, in such amounts and covering such risks as is
required by any Governmental Authority having jurisdiction with respect thereto
or as is carried generally in accordance with sound business practice by
companies in similar businesses similarly situated and in any event in amount,
adequacy and scope reasonably satisfactory to the Collateral Agent. All policies
covering the Collateral are to be made payable to the Collateral Agent for the
benefit of the Lenders, as its interests may appear, in case of loss, under a
standard non-contributory "lender" or "secured party" clause and are to contain
such other provisions as the Collateral Agent may require to fully protect the
Lenders' interest in the Collateral and to any payments to
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be made under such policies. All certificates of insurance are to be delivered
to the Collateral Agent and the policies are to be premium prepaid, with the
loss payable and additional insured endorsement in favor of the Collateral Agent
and such other Persons as the Collateral Agent may designate from time to time,
and shall provide for not less than 30 days' prior written notice to the
Collateral Agent of the exercise of any right of cancellation. If any Loan Party
or any of its Subsidiaries fails to maintain such insurance, the Collateral
Agent may arrange for such insurance, but at the Borrower's expense and without
any responsibility on the Collateral Agent's part for obtaining the insurance,
the solvency of the insurance companies, the adequacy of the coverage, or the
collection of claims. During the continuance of an Event of Default, the
Collateral Agent shall have the sole right, in the name of the Lenders, any Loan
Party and its Subsidiaries, to file claims under any insurance policies, to
receive, receipt and give acquittance for any payments that may be payable
thereunder, and to execute any and all endorsements, receipts, releases,
assignments, reassignments or other documents that may be necessary to effect
the collection, compromise or settlement of any claims under any such insurance
policies.
(i) Obtaining of Permits, Etc. Obtain, maintain and
preserve, and cause each of its Subsidiaries to obtain, maintain and preserve,
and take all necessary action to timely renew, all permits, licenses,
authorizations, approvals, entitlements and accreditations which are necessary
or useful in the proper conduct of its business except where the failure to so
obtain, maintain, preserve or renew could not reasonably be expected to result
in a Material Adverse Effect.
(j) Environmental. (i) Keep any property either owned
or operated by it or any of its Subsidiaries free of any Environmental Liens;
(ii) comply, and cause each of its Subsidiaries to comply, in all material
respects with Environmental Laws and provide to the Collateral Agent any
documentation of such compliance which the Collateral Agent may reasonably
request; (iii) promptly notify the Agents of any Release of a Hazardous Material
in excess of any reportable quantity from or onto property owned or operated by
it or any of its Subsidiaries and take any Remedial Actions reasonably required
to ▇▇▇▇▇ said Release; (iv) promptly provide the Agents with written notice
within 10 days of the receipt of any of the following: (A) notice that an
Environmental Lien has been filed against any property of any Loan Party or any
of its Subsidiaries; (B) commencement of any Environmental Action or notice that
an Environmental Action will be filed against any Loan Party or any of its
Subsidiaries; and (C) notice of a violation, citation or other administrative
order which could have a Material Adverse Effect and (v) defend, indemnify and
hold harmless the Agents and the Lenders and their transferees, and their
respective employees, agents, officers and directors, from and against any
claims, demands, penalties, fines, liabilities, settlements, damages, costs or
expenses (including, without limitation, attorney and consultant fees,
investigation and laboratory fees, court costs and litigation expenses) arising
out of (A) the presence, disposal, Release or threatened Release of any
Hazardous Materials on any property currently or formerly owned, operated or
occupied by any Loan Party or any of its Subsidiaries (or its predecessors in
interest or title), (B) any personal injury (including wrongful death) or
property damage (real or personal) arising out of or related to such presence,
disposal, Release or threatened Release of Hazardous Materials, (C) any
investigation, lawsuit brought or threatened, settlement reached or government
order relating to such presence, disposal, Release or threatened Release of
Hazardous Materials, (D) any material violation of any Environmental Law and/or
(E) any Environmental Action filed against any Agent or any Lender.
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(k) Further Assurances. Take such action and execute,
acknowledge and deliver, and cause each of its Subsidiaries to take such action
and execute, acknowledge and deliver, at its sole cost and expense, such
agreements, instruments or other documents as any Agent may reasonably require
from time to time in order (i) to carry out more effectively the purposes of
this Agreement and the other Loan Documents, (ii) to subject to valid and
perfected first priority Liens any of the Collateral or any other property of
any Loan Party and its Subsidiaries, (iii) to establish and maintain the
validity and effectiveness of any of the Loan Documents and the validity,
perfection and priority of the Liens intended to be created thereby, and (iv) to
better assure, convey, grant, assign, transfer and confirm unto each Agent, each
Lender and the L/C Issuer the rights now or hereafter intended to be granted to
it under this Agreement or any other Loan Document. In furtherance of the
foregoing, to the maximum extent permitted by applicable law, each Loan Party
(A) authorizes each Agent during the continuance of an Event of Default to
execute any such agreements, instruments or other documents in such Loan Party's
name and to file such agreements, instruments or other documents in any
appropriate filing office, (B) authorizes each Agent to file any financing
statement required hereunder or under any other Loan Document, and any
continuation statement or amendment with respect thereto, in any appropriate
filing office without the signature of such Loan Party, and (C) ratifies the
filing of any financing statement, and any continuation statement or amendment
with respect thereto, filed without the signature of such Loan Party prior to
the date hereof.
(l) Change in Collateral; Collateral Records. (i)
Give the Collateral Agent (A) once each calendar quarter a schedule of each
location in which any Loan Party has any Ice Factories or owns or leases any
real property, indicating on such schedule any additions or deletions from the
last schedule delivered to the Collateral Agent (or Schedule 6.01(dd) in the
case of the first schedule delivered after the Effective Date) and (B) once each
calendar year a schedule of each location in which any Loan Party has any ice
merchandisers of a Loan Party, provided that the first such schedule under this
clause (B) shall be delivered to the Collateral Agent within 30 days of the
Effective Date, (ii) advise the Collateral Agent promptly, in sufficient detail,
of any material adverse change relating to the type, quantity or quality of the
Collateral or the Lien granted thereon and (iii) execute and deliver, and cause
each of its Subsidiaries to execute and deliver, to the Collateral Agent for the
benefit of the Lenders from time to time, solely for the Collateral Agent's
convenience in maintaining a record of Collateral, such written statements and
schedules as the Collateral Agent may reasonably require, designating,
identifying or describing the Collateral.
(m) Subordination. Cause all Indebtedness and other
obligations now or hereafter owed by it to any of its Affiliates, to be
subordinated in right of payment and security to the Indebtedness and other
Obligations owing to the Agents and the Lenders in accordance with a
subordination agreement in form and substance reasonably satisfactory to the
Agents.
(n) After Acquired Real Property. Upon the
acquisition by it or any of its Subsidiaries after the date hereof of any
interest (whether fee or leasehold) in any real property (wherever located)
(each such interest being an "After Acquired Property") (x) with a Current Value
(as defined below) in excess of $500,000 in the case of a fee interest, or (y)
requiring the payment of annual rent exceeding in the aggregate $360,000 in the
case of
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leasehold interest, immediately so notify the Collateral Agent, setting forth
with specificity a description of the interest acquired, the location of the
real property, any structures or improvements thereon and either an appraisal or
such Loan Party's good-faith estimate of the current value of such real property
(for purposes of this Section, the "Current Value"). The Collateral Agent shall
notify such Loan Party whether it intends to require a Mortgage and the other
documents referred to below or in the case of leasehold, a leasehold Mortgage or
landlord's waiver (pursuant to Section 7.01(q) hereof). Within 10 days of the
receipt of such notice requesting a Mortgage, the Person which has acquired such
After Acquired Property shall furnish to the Collateral Agent the following,
each in form and substance reasonably satisfactory to the Collateral Agent: (i)
a Mortgage with respect to such real property and related assets located at the
After Acquired Property, duly executed by such Person and in recordable form;
(ii) evidence of the recording of the Mortgage referred to in clause (i) above
in such office or offices as may be necessary or, in the reasonable opinion of
the Collateral Agent, desirable to create and perfect a valid and enforceable
first priority lien on the property purported to be covered thereby or to
otherwise protect the rights of the Agents and the Lenders thereunder, (iii) a
Title Insurance Policy, (iv) to the extent available, a survey of such real
property, certified to the Collateral Agent and to the issuer of the Title
Insurance Policy by a licensed professional surveyor reasonably satisfactory to
the Collateral Agent, (v) Phase I Environmental Site Assessments with respect to
such real property, certified to the Collateral Agent by a company reasonably
satisfactory to the Collateral Agent, (vi) in the case of a leasehold interest,
a certified copy of the lease between the landlord and such Person with respect
to such real property in which such Person has a leasehold interest, and the
certificate of occupancy with respect thereto, (vii) in the case of a leasehold
interest, use commercially reasonable efforts to obtain a consent, attornment
and nondisturbance agreement between the landlord (and any fee mortgagee) with
respect to such real property and the Collateral Agent, and (viii) such other
documents or instruments (including guarantees and opinions of counsel) as the
Collateral Agent may reasonably require. The Borrower shall pay all fees and
expenses, including reasonable attorneys' fees and expenses, and all title
insurance charges and premiums, in connection with each Loan Party's obligations
under this Section 7.01(n).
(o) Fiscal Year. Cause the Fiscal Year of the
Borrower and its Subsidiaries to end on December 31 of each calendar year unless
the Agents consent to a change in such Fiscal Year (and appropriate related
changes to this Agreement).
(p) Borrowing Base. Maintain all Revolving Loans and
Letter of Credit Obligations in compliance with the then current Borrowing Base.
(q) Landlord Subordination or Waiver Agreements. At
any time any Collateral with a book value in excess of $250,000 (when aggregated
with all other Collateral at the same location) is located on any facility of
the Borrower or any other Loan Party (whether such facility is now existing or
acquired after the Effective Date) which is not owned by the Borrower or any
other Loan Party, use commercially reasonable efforts to obtain written
subordinations or waivers, in form and substance reasonably satisfactory to the
Collateral Agent, of all present and future Liens to which the owner or lessor
of such premises may be entitled to assert against the Collateral; provided,
that in the event the Loan Parties are unable to obtain any such written
subordination or waiver the Administrative Agent may, in its reasonable
discretion, establish such reserve as it reasonably deems necessary with respect
to any such Collateral.
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(r) Access Agreements. Use commercially reasonable
efforts to obtain written access agreements, in form and substance satisfactory
to the Collateral Agent, providing access to the Ice Factories located on any
premises not owned by the Borrower or any other Loan Party in order to remove
such Ice Factories from such premises during an Event of Default; provided, that
in the event the Loan Parties are unable to obtain any such written access
agreements, the Administrative Agent may, in its reasonable discretion,
establish such reserve as it deems necessary with respect to any such
Collateral.
Section 7.02 Negative Covenants. So long as any principal of
or interest on any Loan, Reimbursement Obligation, Letter of Credit Obligation
or any other Obligation (whether or not due) shall remain unpaid or any Lender
shall have any Commitment hereunder, the Borrower shall not, unless the Required
Lenders shall otherwise consent in writing:
(a) Liens, Etc. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Lien upon or with respect to any of its properties, whether now owned
or hereafter acquired; file or suffer to exist under the Uniform Commercial Code
or any similar law or statute of any jurisdiction, a financing statement (or the
equivalent thereof) that names it or any of its Subsidiaries as debtor; sign or
suffer to exist any security agreement authorizing any secured party thereunder
to file such financing statement (or the equivalent thereof); sell any of its
property or assets subject to an understanding or agreement, contingent or
otherwise, to repurchase such property or assets (including sales of accounts
receivable) with recourse to it or any of its Subsidiaries or assign or
otherwise transfer, or permit any of its Subsidiaries to assign or otherwise
transfer, any account or other right to receive income; other than, as to all of
the above, Permitted Liens; provided, that no Liens shall be permitted on any
assets included in the Borrowing Base other than the Liens of the Collateral
Agent for the benefit of the Lenders and inchoate Liens of the type described in
clauses (b) and (c) of the definition of Permitted Liens.
(b) Indebtedness. Create, incur, assume, guarantee or
suffer to exist, or otherwise become or remain liable with respect to, or permit
any of its Subsidiaries to create, incur, assume, guarantee or suffer to exist
or otherwise become or remain liable with respect to, any Indebtedness other
than Permitted Indebtedness.
(c) Fundamental Changes; Dispositions. Wind-up,
liquidate or dissolve, or merge, consolidate or amalgamate with any Person, or
convey, sell, lease or sublease, transfer or otherwise dispose of, whether in
one transaction or a series of related transactions, all or any part of its
business, property or assets, whether now owned or hereafter acquired (or agree
to do any of the foregoing unless any such agreement is subject to any consents
or waivers required under the terms of this Agreement), or purchase or otherwise
acquire, whether in one transaction or a series of related transactions, all or
substantially all of the assets of any Person (or any division thereof) (or
agree to do any of the foregoing), or permit any of its Subsidiaries to do any
of the foregoing; provided, however, that
(i) the Borrower or any Subsidiary Guarantor
existing on the Effective Date may be merged into the Borrower or any Subsidiary
Guarantor existing on the Effective Date, or may consolidate with the Borrower
or any Subsidiary Guarantor existing on the Effective Date, so long as (A) no
other provision of this Agreement would be violated
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thereby, (B) such Loan Party gives the Agents at least 20 days' prior written
notice of such merger or consolidation, (C) no Default or Event of Default shall
have occurred and be continuing either before or after giving effect to such
transaction, and (D) the Lenders' rights in any Collateral, including, without
limitation, the existence, perfection and priority of any Lien thereon, are not
adversely affected by such merger or consolidation; and
(ii) any Loan Party and its Subsidiaries may
(A) sell Inventory in the ordinary course of business, (B) sell the "Reddy
Assets" as defined in the Reddy Asset Purchase Agreement, (C) dispose of
obsolete or worn-out equipment in the ordinary course of business, (D) sell or
otherwise dispose of other property or assets for cash in an aggregate amount
not less than the fair market value of such property or assets, provided that,
the Net Cash Proceeds of such Dispositions in the case of clauses (C) and (D)
above, (x) do not exceed $10,000,000 in the aggregate in any twelve-month period
and (y) are applied pursuant to the terms of Sections 2.05(c)(v) and 2.05(d),
and (E) sell or transfer assets to the Borrower or a Subsidiary Guarantor
existing on the Effective Date.
(d) Change in Nature of Business. Make, or permit any
of its Subsidiaries to make, any change in the nature of its business as
described in Section 6.01(l).
(e) Loans, Advances, Investments, Etc. Make or commit
or agree to make any loan, advance, guarantee of obligations, other extension of
credit or capital contributions to, or hold or invest in or commit or agree to
hold or invest in, or purchase or otherwise acquire or commit or agree to
purchase or otherwise acquire any shares of the Capital Stock, bonds, notes,
debentures or other securities of, or make or commit or agree to make any other
investment in, any other Person, or purchase or own any futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or permit any
of its Subsidiaries to do any of the foregoing, except for: (i) investments
existing on the date hereof, as set forth on Schedule 7.02(e) hereto, but not
any increase in the amount thereof as set forth in such Schedule or any other
modification of the terms thereof, (ii) loans, advances and capital
contributions by it to the Subsidiary Guarantors, loans and advances by the
Subsidiary Guarantors to it, and loans and advances by any Subsidiary Guarantor
to another Subsidiary Guarantor, provided that any loan or advance by the
Borrower to a Subsidiary Guarantor shall be evidenced by a Subsidiary Note that
has been a pledged to the Collateral Agent, (iii) guarantees described in clause
(e) of the definition of "Permitted Indebtedness" and (iv) Permitted
Investments, (v) purchases and/or redemptions of the Senior Notes, provided that
both immediately before and immediately after giving effect to such purchases
and/or redemptions of the Senior Notes, (A) the ratio of Senior Debt to
Consolidated EBITDA of the Borrower and its Subsidiaries for the most recently
ended twelve months shall not be greater than 2.0 to 1.0, (B) no Default or
Event of Default shall have occurred and be continuing and (C) Availability
shall not be less than $10,000,000, and (vi) Permitted Acquisitions. In
determining the ratio pursuant to clause (v)(A) above for a particular period
(i) pro forma effect will be given to: (A) the incurrence, repayment or
retirement of any Indebtedness by such Person and its Subsidiaries since the
first day of such period as if such Indebtedness was incurred, repaid or retired
on the first day of such period and (B) the acquisition (whether by purchase,
merger or otherwise) or disposition (whether by sale, merger or otherwise) of
any property or assets acquired or disposed of by such Person and its
Subsidiaries since the first day of such period, as if such acquisition or
disposition occurred on
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the first day of such period; (ii) interest on Indebtedness bearing a floating
interest rate will be computed as if the rate of computation had been the
applicable rate for the entire period; (iii) if such Indebtedness bears, at the
option of such Person and its Subsidiaries, a fixed or floating rate of
interest, interest thereon will be computed by applying, at the option of such
Person, either the fixed or floating rate; and (iv) the amount of Indebtedness
under a revolving credit facility will be computed based upon the average daily
balance of such Indebtedness during such period.
(f) Lease Obligations. Create, incur or suffer to
exist, or permit any of its Subsidiaries to create, incur or suffer to exist,
any obligations as lessee (i) for the payment of rent for any real or personal
property in connection with any sale and leaseback transaction, or (ii) for the
payment of rent for any real or personal property under leases or agreements to
lease other than (A) Capitalized Lease Obligations which would not cause the
aggregate amount of all obligations under Capitalized Leases entered into after
the Effective Date owing by all Loan Parties and their Subsidiaries in any
Fiscal Year to exceed the amounts set forth in subsection (g) of this Section
7.02, and (B) Operating Lease Obligations which would not cause the aggregate
amount of all Operating Lease Obligations owing by all Loan Parties and their
Subsidiaries in any Fiscal Year to exceed $15,300,000.
(g) Capital Expenditures. (i) Make or commit or agree
to make, or permit any of its Subsidiaries to make or commit or agree to make,
any Capital Expenditure (by purchase or Capitalized Lease) that would cause the
aggregate amount of all Capital Expenditures made by the Loan Parties and their
Subsidiaries to exceed $15,000,000 in any Fiscal Year commencing 2002 provided,
that, for purposes of this Section 7.02(g)(i), Capital Expenditures shall
exclude expenditures used to acquire Ice Factories then subject to operating
leases.
(ii) Make or commit or agree to make, or
permit any of its Subsidiaries to make or commit or agree to make, any Capital
Expenditures to acquire Ice Factories then subject to operating leases that
would cause the aggregate amount of all such Capital Expenditures made by the
Loan Parties and their Subsidiaries together with the aggregate amount of
Permitted Acquisitions with respect to all of the Loan Parties to exceed
$5,000,000 in any calendar year from the Effective Date until and including the
Final Maturity Date, provided that the purchase of assets provided for in the
Reddy Asset Purchase Agreement shall not subject to the limitation set forth in
this Section 7.02(g)(ii).
(h) Restricted Payments. (i) Declare or pay any
dividend or other distribution, direct or indirect, on account of any Capital
Stock of any Loan Party or any of its Subsidiaries, now or hereafter
outstanding, (ii) make any repurchase, redemption, retirement, defeasance,
sinking fund or similar payment, purchase or other acquisition for value, direct
or indirect, of any Capital Stock of any Loan Party or any direct or indirect
parent of any Loan Party, now or hereafter outstanding, (iii) make any payment
to retire, or to obtain the surrender of, any outstanding warrants, options or
other rights for the purchase or acquisition of shares of any class of Capital
Stock of any Loan Party, now or hereafter outstanding, (iv) make any
distribution of property, assets, shares of Capital Stock, warrants, rights,
options, obligations or securities to any shareholders or other equityholders of
any Loan Party as such or (v) pay any management fees or any other fees or
expenses (including the reimbursement thereof by any Loan Party or any of its
Subsidiaries) pursuant to (A) any management agreement with any of
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the shareholders or other equityholders of any Loan Party or any of its
Subsidiaries or other Affiliates, or to any other Subsidiaries or Affiliates of
any Loan Party or (B) any consulting or other services agreement with any
Affiliates of any Loan Party; provided, however, (i) any Subsidiary of the
Borrower may pay dividends to the Borrower, (ii) the Borrower may pay dividends
in the form of its common Capital Stock and (iii) the Borrower may make payments
under employee severance agreements existing on the Effective Date.
(i) Federal Reserve Regulations. Permit any Loan or
the proceeds of any Loan under this Agreement to be used for any purpose that
would cause such Loan to be a margin loan under the provisions of Regulation T,
U or X of the Board.
(j) Transactions with Affiliates. Enter into, renew,
extend or be a party to, or permit any of its Subsidiaries to enter into, renew,
extend or be a party to, any transaction or series of related transactions
(including, without limitation, the purchase, sale, lease, transfer or exchange
of property or assets of any kind or the rendering of services of any kind) with
any Affiliate, except (i) in the ordinary course of business in a manner and to
an extent consistent with past practice and necessary or desirable for the
prudent operation of its business, for fair consideration and on terms no less
favorable to it or its Subsidiaries than would be obtainable in a comparable
arm's length transaction with a Person that is not an Affiliate thereof, (ii)
transactions with another Loan Party and (iii) transactions permitted by Section
7.02(e).
(k) Limitations on Dividends and Other Payment
Restrictions Affecting Subsidiaries. Create or otherwise cause, incur, assume,
suffer or permit to exist or become effective any consensual encumbrance or
restriction of any kind on the ability of any Subsidiary of any Loan Party (i)
to pay dividends or to make any other distribution on any shares of Capital
Stock of such Subsidiary owned by any Loan Party or any of its Subsidiaries,
(ii) to pay or prepay or to subordinate any Indebtedness owed to any Loan Party
or any of its Subsidiaries, (iii) to make loans or advances to any Loan Party or
any of its Subsidiaries or (iv) to transfer any of its property or assets to any
Loan Party or any of its Subsidiaries, or permit any of its Subsidiaries to do
any of the foregoing; provided, however, that nothing in any of clauses (i)
through (iv) of this Section 7.02(k) shall prohibit or restrict compliance with:
(A) this Agreement and the other Loan
Documents;
(B) any agreements in effect on the date of
this Agreement and described on Schedule 7.02(k);
(C) any applicable law, rule or regulation
(including, without limitation, applicable currency control laws and
applicable state corporate statutes restricting the payment of
dividends in certain circumstances);
(D) in the case of clause (iv) any agreement
setting forth customary restrictions on the subletting, assignment or
transfer of any property or asset that is a lease, license, conveyance
or contract of similar property or assets;
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(E) in the case of clause (iv) any
agreement, instrument or other document evidencing a Permitted Lien
from restricting on customary terms the transfer of any property or
assets subject thereto; or
(F) customary provisions in agreements
relating to the sale of stock of a Subsidiary or of any assets of any
Loan Party provided that such sale is not otherwise prohibited by the
terms of this Agreement.
(l) Limitation on Issuance of Capital Stock. Permit
any Subsidiary to issue or sell or enter into any agreement or arrangement for
the issuance and sale of any shares of its Capital Stock, any securities
convertible into or exchangeable for its Capital Stock or any warrants.
(m) Modifications of Indebtedness, Organizational
Documents and Certain Other Agreements; Etc. (i) Amend, modify or otherwise
change (or permit the amendment, modification or other change in any manner of)
any of the provisions of any of its or its Subsidiaries' Indebtedness (including
the Indenture) or of any instrument or agreement (including, without limitation,
any purchase agreement, indenture, loan agreement or security agreement)
relating to any such Indebtedness if such amendment, modification or change
would shorten the final maturity or average life to maturity of, or require any
payment to be made earlier than the date originally scheduled on, such
Indebtedness, would increase the interest rate applicable to such Indebtedness,
would change the subordination provision, if any, of such Indebtedness, or would
otherwise be adverse to the Lenders or the issuer of such Indebtedness in any
respect, (ii) except for the Obligations, make any voluntary or optional
payment, prepayment, redemption, defeasance, sinking fund payment or other
acquisition for value of any of its or its Subsidiaries' Indebtedness
(including, without limitation, by way of depositing money or securities with
the trustee therefor before the date required for the purpose of paying any
portion of such Indebtedness when due), or refund, refinance, replace or
exchange any other Indebtedness for any such Indebtedness (except to the extent
such Indebtedness is otherwise expressly permitted by the definition of
"Permitted Indebtedness"), or make any payment, prepayment, redemption,
defeasance, sinking fund payment or repurchase of any outstanding Indebtedness
as a result of any asset sale, change of control, issuance and sale of debt or
equity securities or similar event, or give any notice with respect to any of
the foregoing, provided that the Borrower may purchase or redeem Senior Notes if
both immediately before and immediately after giving effect to such purchases
and/or redemptions (A) the ratio of Senior Debt to Consolidated EBITDA of the
Borrower and its Subsidiaries for the most recently ended twelve months shall
not be greater than 2.0 to 1.0, (B) no Default or Event of Default shall have
occurred and be continuing and (C) Availability shall not be less than
$10,000,000, (iii) except as permitted by Section 7.02(c), amend, modify or
otherwise change its name, jurisdiction of organization, organizational
identification number or FEIN, (iv) amend, modify or otherwise change its
certificate of incorporation or bylaws (or other similar organizational
documents), including, without limitation, by the filing or modification of any
certificate of designation, or any agreement or arrangement entered into by it,
with respect to any of its Capital Stock (including any shareholders'
agreement), or enter into any new agreement with respect to any of its Capital
Stock, except any such amendments, modifications or changes or any such new
agreements or arrangements pursuant to this clause (iv) that either individually
or in the aggregate, could not reasonably expected to have a Material Adverse
Effect or (v) cause or
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permit (1) any Indebtedness other than the Indebtedness under this Agreement to
be designated as "Permitted Indebtedness" under clause (vi) of the definition
thereof set forth in the Indenture or (2) more than $2,000,000 of Indebtedness
other than the Indebtedness under this Agreement to be designated as "Permitted
Indebtedness" under clause (x) of the definition thereof set forth in the
Indenture. In determining the ratio pursuant to clause (ii)(A) above for a
particular period (i) pro forma effect will be given to: (x) the incurrence,
repayment or retirement of any Indebtedness by such Person and its Subsidiaries
since the first day of such period as if such Indebtedness was incurred, repaid
or retired on the first day of such period and (y) the acquisition (whether by
purchase, merger or otherwise) or disposition (whether by sale, merger or
otherwise) of any property or assets acquired or disposed of by such Person and
its Subsidiaries since the first day of such period, as if such acquisition or
disposition occurred on the first day of such period; (ii) interest on
Indebtedness bearing a floating interest rate will be computed as if the rate of
computation had been the applicable rate for the entire period; (iii) if such
Indebtedness bears, at the option of such Person and its Subsidiaries, a fixed
or floating rate of interest, interest thereon will be computed by applying, at
the option of such Person, either the fixed or floating rate; and (iv) the
amount of Indebtedness under a revolving credit facility will be computed based
upon the average daily balance of such Indebtedness during such period.
(n) Investment Company Act of 1940. Engage in any
business, enter into any transaction, use any securities or take any other
action or permit any of its Subsidiaries to do any of the foregoing, that would
cause it or any of its Subsidiaries to become subject to the registration
requirements of the Investment Company Act of 1940, as amended, by virtue of
being an "investment company" or a company "controlled" by an "investment
company" not entitled to an exemption within the meaning of such Act.
(o) Compromise of Accounts Receivable. Compromise or
adjust any Account Receivable (or extend the time of payment thereof) or grant
any discounts, allowances or credits or permit any of its Subsidiaries to do so
other than, provided no Default or Event of Default has occurred and is
continuing, in the ordinary course of its business.
(p) ERISA. (i) Engage, or permit any ERISA Affiliate
to engage, in any transaction described in Section 4069 of ERISA; (ii) engage,
or permit any ERISA Affiliate to engage, in any prohibited transaction described
in Section 406 of ERISA or 4975 of the Internal Revenue Code for which a
statutory or class exemption is not available or a private exemption has not
previously been obtained from the U.S. Department of Labor; (iii) adopt or
permit any ERISA Affiliate to adopt any employee welfare benefit plan within the
meaning of Section 3(1) of ERISA which provides benefits to employees after
termination of employment other than as required by Section 601 of ERISA or
applicable law; (iv) fail to make any contribution or payment to any
Multiemployer Plan which it or any ERISA Affiliate may be required to make under
any agreement relating to such Multiemployer Plan, or any law pertaining
thereto; or (v) fail, or permit any ERISA Affiliate to fail, to pay any required
installment or any other payment required under Section 412 of the Internal
Revenue Code on or before the due date for such installment or other payment.
(q) Environmental. Permit the use, handling,
generation, storage, treatment, release or disposal of Hazardous Materials at
any property owned or leased by it or any of its Subsidiaries, except in
compliance with Environmental Laws and so long as such use,
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handling, generation, storage, treatment, release or disposal of Hazardous
Materials does not result in a Material Adverse Effect.
(r) Certain Agreements. Agree to any material
amendment or other material change to or material waiver of any of its rights
under any Material Contract.
(s) Properties. Permit any property to become a
fixture with respect to Real Property or to become an accession with respect to
other personal property with respect to which real or personal property the
Collateral Agent does not have a Lien. Furthermore, the Borrower will not, and
will cause its Subsidiaries not to, without the Collateral Agent's prior written
consent, alter or remove any identifying symbol or number on any of the
Borrower's or its Subsidiaries' property that is or may become Collateral.
Section 7.03 Financial Covenants. So long as any principal of
or interest on any Loan, Reimbursement Obligation, Letter of Credit Obligation
or any other Obligation (whether or not due) shall remain unpaid or any Lender
shall have any Commitment hereunder, the Borrower shall not, unless the Required
Lenders shall otherwise consent in writing:
(a) Fixed Charge Coverage Ratio. Permit the Fixed
Charge Coverage Ratio of the Borrower and its Subsidiaries for each period of
four (4) consecutive fiscal quarters of the Borrower ending at the end of each
fiscal quarter of the Borrower to be less than (i) from December 31, 2001
through December 31, 2002, 1.0:1.0, and (ii) from January 1, 2003 through the
Final Maturity Date, 1.05:1.0.
(b) EBITDA. Permit Consolidated EBITDA of the
Borrower and its Subsidiaries for each period of four (4) consecutive fiscal
quarters of the Borrower ending at the end of each fiscal quarter of the
Borrower to be less than $44,000,000.
(c) EBITDA to Senior Interest Ratio. Permit the ratio
of Consolidated EBITDA, for each period of four (4) consecutive fiscal quarters
of the Borrower to Senior Interest at the end of each fiscal quarter of the
Borrower to be less than 4.5:1.0.
(d) Senior Debt to EBITDA Ratio. Permit the ratio of
Senior Debt to Consolidated EBITDA of the Borrower and its Subsidiaries, for
each period of four (4) consecutive fiscal quarters of the Borrower ending at
the end of each fiscal quarter of the Borrower to be more than 2.0:1.0.
In determining the ratios pursuant to subsections 7.03(a), (c) and (d) for a
particular period (i) pro forma effect will be given to: (A) the incurrence,
repayment or retirement of any Indebtedness by such Person and its Subsidiaries
since the first day of such period as if such Indebtedness was incurred, repaid
or retired on the first day of such period and (B) the acquisition (whether by
purchase, merger or otherwise) or disposition (whether by sale, merger or
otherwise) of any property or assets acquired or disposed of by such Person and
its Subsidiaries since the first day of such period, as if such acquisition or
disposition occurred on the first day of such period; (ii) interest on
Indebtedness bearing a floating interest rate will be computed as if the rate of
computation had been the applicable rate for the entire period; (iii) if such
Indebtedness bears, at the option of such Person and its Subsidiaries, a fixed
or floating rate of interest, interest thereon will be computed by applying, at
the option of such Person, either the
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fixed or floating rate; and (iv) the amount of Indebtedness under a revolving
credit facility will be computed based upon the average daily balance of such
Indebtedness during such period.
ARTICLE VIII
MANAGEMENT, COLLECTION AND STATUS OF
ACCOUNTS RECEIVABLE AND OTHER COLLATERAL
Section 8.01 Collection of Accounts Receivable; Management of
Collateral.
(a) National Accounts. With respect to National
Accounts, on or prior to the date which is the earlier of 45 days from the
Effective Date or such earlier date as the Administrative Agent may require
(such earlier date, the "Lockbox Effective Date"), the Borrower shall assist,
and shall cause each of the other Loan Parties to assist, the Administrative
Agent in (i) establishing, and, during the term of this Agreement, maintaining
one or more lockboxes in the name of the Administrative Agent and identified on
Schedule 8.01(a) hereto, which Schedule shall be delivered to the Administrative
Agent on or prior to the Lockbox Effective Date (collectively, the "Lockboxes")
with the financial institutions set forth on such Schedule 8.01(a) or such other
financial institutions selected by the Borrower or the other Loan Parties, as
the case may be, and acceptable to the Administrative Agent in its sole
discretion (each being referred to as a "Lockbox Bank") and (ii) establishing,
and during the term of this Agreement, maintaining an account (a "Collection
Account" and, collectively, the "Collection Accounts") in the name of the
Administrative Agent with each Lockbox Bank. On or prior to the Lockbox
Effective Date, each Lockbox Bank will enter into a lockbox agreement with the
Administrative Agent in form and substance reasonably satisfactory to the
Administrative Agent. On and after the Lockbox Effective Date, the Borrower and
the other Loan Parties shall irrevocably instruct their Account Debtors with
respect to the National Accounts, to remit all payments to be made by checks or
other drafts to the Lockboxes and to remit all payments to be made by wire
transfer or by Automated Clearing House, Inc. payment as directed by the
Administrative Agent and shall instruct each Lockbox Bank to deposit all amounts
received in its Lockbox to the Collection Account at such Lockbox Bank on the
day received or, if such day is not a Business Day, on the next succeeding
Business Day. Until the Administrative Agent has advised the Borrower to the
contrary during the continuance of an Event of Default, the Borrower and the
other Loan Parties may and will enforce, collect and receive all amounts owing
on the Accounts Receivable of the Borrower and the other Loan Parties for the
Administrative Agent's benefit and on the Administrative Agent's behalf, but at
the Borrower's and the other Loan Parties' expense; such privilege shall be
suspended, at the election of any Agent, during the continuance of an Event of
Default. On and after the Lockbox Effective Date, all checks, drafts, notes,
money orders, acceptances, cash and other evidences of Indebtedness received
directly by the Borrower and the other Loan Parties from its Account Debtors
with respect to National Accounts, as proceeds from such Accounts Receivable, or
as proceeds of any other Collateral, shall be held by the Borrower and the other
Loan Parties in trust for the Agents and the Lenders and upon receipt be
deposited by the Borrower and the other Loan Parties in original form and no
later than the next Business Day after receipt thereof into a Collection
Account. The Borrower and the other Loan Parties shall not commingle, such
collections with the Borrower's and such other Loan Parties' own funds or the
funds of any Subsidiary or Affiliate of the
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Borrower and the other Loan Parties or with the proceeds of any assets not
included in the Collateral. All funds received in the Collection Accounts shall
be processed by the respective Lockbox Banks in accordance with the instructions
of officers or agents of the Borrower and the other Loan Parties in accordance
with prior practice. Each day all funds received in the Collection Account shall
be sent by wire transfer or Automated Clearing House, Inc. payment to the Cash
Concentration Account. During the continuance of an Event of Default, the
Administrative Agent shall charge the Loan Account on the last day of each month
with two (2) collection days for all such collections received in the Collection
Account. No checks, drafts or other instruments received by the Administrative
Agent shall constitute final payment to the Administrative Agent unless and
until such checks, drafts or instruments have actually been collected.
(b) Local Accounts. With respect to Local Accounts,
on or prior to the Effective Date, the Borrower and the other Loan Parties shall
assist the Administrative Agent in (i) establishing, and during the term of this
Agreement, maintaining one or more depository accounts in the name of a Loan
Party and identified on Schedule 8.01(b) hereto (a "Depository Account" and
collectively, the "Depository Accounts") with the financial institutions set
forth on Schedule 8.01(b) hereto or such other financial institutions selected
by Borrower, as the case may be, and acceptable to the Administrative Agent in
its reasonable business judgment (each being referred to as a "Depository Bank")
and (ii) establishing, and during the term of this Agreement, maintaining an
account in the name of the Administrative Agent (the "Cash Concentration
Account") with a financial institution that is selected by the Borrower and that
is acceptable to the Administrative Agent in its reasonable business judgment
(the "Cash Concentration Bank"). On or prior to the Effective Date, the Cash
Concentration Bank will enter into a cash concentration account agreement with
the Administrative Agent in form and substance reasonably satisfactory to the
Administrative Agent (the "Cash Concentration Agreement"). The Borrower and the
other Loan Parties shall irrevocably instruct its Account Debtors with respect
to Local Accounts, to remit all payments to be made by checks or other drafts to
the Depository Accounts or deposit all payments with respect to the Local
Accounts made by check or other drafts into the Depository Accounts and within
30 days of the Effective Date shall send a direction letter, substantially in
the form of Exhibit K hereto, that irrevocably instructs each Depository Bank to
transfer all amounts received in its Depository Account to the Cash
Concentration Account at the Cash Concentration Bank on the day received or, if
such day is not a Business Day, on the next succeeding Business Day. The
Borrower shall promptly, and in any event not later than 5 days after the
opening of any new Depository Account of the Borrower or any other Loan Party,
notify the Administrative Agent in writing of the creation of such new
Depository Account and shall at the time of such notice send a direction letter,
substantially in the form of Exhibit K hereto, that irrevocably instructs each
Depository Bank to transfer all amounts received in its Depository Account to
the Cash Concentration Account at the Cash Concentration Bank on the day
received or, if such day is not a Business Day, on the next succeeding Business
Day. Until the Administrative Agent has advised the Borrower and the other Loan
Parties to the contrary during the continuance of an Event of Default, the
Borrower and the other Loan Parties may and will enforce, collect and receive
all amounts owing on the Local Accounts for the Administrative Agent's benefit
and on the Administrative Agent's behalf, but at the Borrower's and the other
Loan Parties' expense; such privilege shall be suspended, at the election of any
Agent, during the continuance of an Event of Default. All checks, drafts, notes,
money orders, acceptances, cash and other evidences of Indebtedness received
directly by
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the Borrower and the other Loan Parties from its Account Debtors with respect to
Local Accounts as proceeds from Accounts Receivable or as proceeds of any other
Collateral, shall be held by the Borrower and the other Loan Parties in trust
for the Agents and the Lenders and upon receipt be deposited by the Borrower and
the other Loan Parties in original form and no later than the next Business Day
after receipt thereof into a Depository Account or the Cash Concentration
Account. The Borrower and the other Loan Parties shall not commingle such
collections with the Borrower's and the other Loan Parties' own funds or the
funds of any Subsidiary or Affiliate of the Borrower and the other Loan Parties
or with the proceeds of any assets not included in the Collateral.
(c) National Accounts: Prior to the Lockbox Effective
Date. Prior to the Lockbox Effective Date, all checks, drafts, notes, money
orders, acceptances, cash and other evidences of Indebtedness received directly
by the Borrower and the other Loan Parties from its Account Debtors with respect
to National Accounts as proceeds from Accounts Receivable or as proceeds of any
other Collateral, shall be held by the Borrower and the other Loan Parties in
trust for the Agents and the Lenders and upon receipt be deposited by the
Borrower and the other Loan Parties in original form and no later than the next
Business Day after receipt thereof into the Cash Concentration Account. The
Borrower and the other Loan Parties shall not commingle such collections with
the Borrower's and the other Loan Parties' own funds or the funds of any
Subsidiary or Affiliate of the Borrower and the other Loan Parties or with the
proceeds of any assets not included in the Collateral. The Borrower and the
other Loan Parties shall take all action necessary to direct that all such
proceeds from Accounts Receivable or proceeds of other Collateral received by
wire transfer or by Automated Clearing House, Inc. payment shall be sent
directly to the Cash Concentration Account.
(d) Application of Funds in Cash Concentration
Account. Except during the continuance of an Event of Default, all funds
received in the Cash Concentration Account shall be processed by the Cash
Concentration Bank in accordance with the instructions of officers or agents of
the Borrower and the other Loan Parties in accordance with prior practice.
During the continuance of an Event of Default, the Administrative Agent may give
notice to the Depository Banks and the Cash Concentration Bank directing that
all funds received in the respective Depository Accounts and the Cash
Concentration Account shall be sent by wire transfer or Automated Clearing
House, Inc. payment to the Administrative Agent's Account for application at the
end of each Business Day to reduce the then principal balance of the
Obligations, conditional upon final payment to the Administrative Agent. The
Administrative Agent shall charge the Loan Account on the last day of each month
with two (2) collection days for all such collections. No checks, drafts or
other instruments received by the Administrative Agent shall constitute final
payment to the Administrative Agent unless and until such checks, drafts or
instruments have actually been collected.
(e) Occurrence and Continuance of Event of Default.
During the continuance of an Event of Default, the Collateral Agent may send a
notice of assignment and/or notice of the Lenders' security interest to any and
all Account Debtors or third parties holding or otherwise concerned with any of
the Collateral, and thereafter the Collateral Agent shall have the sole right to
collect the Accounts Receivable of the Borrower and each of its Subsidiaries
and/or take possession of the Collateral and the books and records relating
thereto. The Borrower shall not, without prior written consent of the Collateral
Agent, grant and shall not allow any of its
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Subsidiaries, without the prior written consent of the Collateral Agent, to
grant, any extension of time of payment of any Account Receivable, compromise or
settle any Account Receivable for less than the full amount thereof, release, in
whole or in part, any Person or property liable for the payment thereof, or
allow any credit or discount whatsoever thereon, except, in the absence of a
continuing Event of Default, as permitted by Section 7.02(o).
(f) Attorney-In-Fact. The Borrower hereby appoints,
and hereby causes each Subsidiary to appoint, each Agent or its designee on
behalf of such Agent as the Borrower's and each of its Subsidiaries'
attorney-in-fact with power exercisable during the continuance of an Event of
Default to endorse the Borrower's name, and the name of any of its Subsidiaries
upon any notes, acceptances, checks, drafts, money orders or other evidences of
payment relating to the Accounts Receivable of the Borrower and each of its
Subsidiaries, to sign the Borrower's name, and the name of any of its
Subsidiaries on any invoice or ▇▇▇▇ of lading relating to any of the Accounts
Receivable of the Borrower or any of its Subsidiaries, drafts against Account
Debtors with respect to Accounts Receivable of the Borrower and any of its
Subsidiaries, assignments and verifications of Accounts Receivable and notices
to Account Debtors with respect to Accounts Receivable of the Borrower and any
of its Subsidiaries, to send verification of Accounts Receivable of the Borrower
and any of its Subsidiaries, and to notify the Postal Service authorities to
change the address for delivery of mail addressed to the Borrower and any of its
Subsidiaries to such address as such Agent may designate and to do all other
acts and things necessary to carry out this Agreement. All acts of said attorney
or designee during an Event of Default are hereby ratified and approved, and
said attorney or designee shall not be liable for any acts of omission or
commission (other than acts of omission or commission constituting gross
negligence or willful misconduct as determined by a final judgment of a court of
competent jurisdiction), this power being coupled with an interest is
irrevocable until all of the Loans, Reimbursement Obligations, Letter of Credit
Obligations and other Obligations under the Loan Documents are paid in full and
all of the Loan Documents are terminated.
(g) Agents. Except as set forth in this Agreement and
the other Loan Documents, nothing herein contained shall be construed to
constitute any Agent as agent of the Borrower or any of its Subsidiaries for any
purpose whatsoever, and the Agents shall not be responsible or liable for any
shortage, discrepancy, damage, loss or destruction of any part of the Collateral
wherever the same may be located and regardless of the cause thereof (other than
from acts of omission or commission constituting gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction). The Agents shall not, under any circumstance or in any event
whatsoever, have any liability for any error or omission or delay of any kind
occurring in the settlement, collection or payment of any of the Accounts
Receivable of the Borrower or any of its Subsidiaries or any instrument received
in payment thereof or for any damage resulting therefrom (other than acts of
omission or commission constituting gross negligence or willful misconduct as
determined by a final judgment of a court of competent jurisdiction). The
Agents, by anything herein or in any assignment or otherwise, do not assume any
of the obligations under any contract or agreement assigned to any Agent and
shall not be responsible in any way for the performance by the Borrower or any
of its Subsidiaries of any of the terms and conditions thereof.
(h) Taxes. If any Account Receivable of the Borrower
or any of its Subsidiaries includes a charge for any tax payable to any
Governmental Authority, each Agent is
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hereby authorized (but in no event obligated) in its discretion to pay the
amount thereof to the proper taxing authority for the Borrower's account and to
charge the Borrower therefor. The Borrower shall notify the Agents if any
Account Receivable of the Borrower or any of its Subsidiaries includes any taxes
due to any such Governmental Authority and, in the absence of such notice, the
Agents shall have the right to retain the full proceeds of such Account
Receivable and shall not be liable for any taxes that may be due by reason of
the sale and delivery creating such Account Receivable.
(i) Rights and Remedies. Notwithstanding any other
terms set forth in the Loan Documents, the rights and remedies of the Agents and
the Lenders herein provided, and the obligations of the Loan Parties set forth
herein, are cumulative of, may be exercised singly or concurrently with, and are
not exclusive of, any other rights, remedies or obligations set forth in any
other Loan Document or as provided by law.
Section 8.02 Accounts Receivable Documentation. The Borrower
will, and will cause each of its Subsidiaries to, at such intervals as the
Agents may reasonably require, execute and deliver confirmatory written
assignments of the Accounts Receivable to the Agents and furnish such further
schedules and/or information as any such Agent may reasonably require relating
to the Accounts Receivable, including, without limitation, sales invoices or the
equivalent, credit memos issued, remittance advices, reports and copies of
deposit slips and copies of original shipping or delivery receipts for all
merchandise sold. In addition, the Borrower shall notify the Agents of any
non-compliance in respect of the representations, warranties and covenants
contained in Section 8.03. The items to be provided under this Section 8.02 are
to be in form reasonably satisfactory to the Agents and are to be executed and
delivered to the Agents from time to time solely for their convenience in
maintaining records of the Collateral. The Borrower's or any of its
Subsidiaries' failure to give any of such items to the Agents shall not affect,
terminate, modify or otherwise limit the Collateral Agent's Lien on the
Collateral. The Borrower shall not, and shall not allow any of its Subsidiaries
to, re-date any invoice or sale or make sales on extended dating beyond that
customary in the Borrower's industry, and shall not re-▇▇▇▇ any Accounts
Receivable without promptly disclosing the same to the Agents and providing the
Agents with a copy of such re-billing, identifying the same as such. If the
Borrower becomes aware of anything materially detrimental to any of the
Borrower's or any of its Subsidiaries' customers' credit, the Borrower will
promptly advise the Agents thereof.
Section 8.03 Status of Accounts Receivable and Other
Collateral. With respect to Collateral of any Loan Party at the time the
Collateral becomes subject to the Collateral Agent's Lien, the Borrower
covenants, represents and warrants: (a) such Loan Party shall be the sole owner,
free and clear of all Liens (except for the Liens granted in the favor of the
Collateral Agent for the benefit of the Lenders and Permitted Liens), and shall
be fully authorized to sell, transfer, pledge and/or grant a security interest
in each and every item of said Collateral; (b) each Account Receivable, except
Accounts Receivable with an aggregate invoice amount not in excess of $50,000,
shall be a good and valid account representing an undisputed bona fide
indebtedness incurred or an amount indisputably owed by the Account Debtor
therein named, for a fixed sum as set forth in the invoice relating thereto with
respect to an absolute sale and delivery upon the specified terms of goods sold
or services rendered by the such Loan Party; (c) no Account Receivable, except
Accounts Receivable with an aggregate invoice amount not in excess of $50,000,
shall be subject to any defense, offset, counterclaim, discount or allowance
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except as may be stated in the invoice relating thereto, discounts and
allowances as may be customary in such Loan Party's business and as otherwise
disclosed to the Agents, and each Account Receivable will be paid when due; (d)
none of the transactions underlying or giving rise to any Account Receivable,
except Accounts Receivable with an aggregate invoice amount not in excess of
$50,000, shall violate any applicable state or federal laws or regulations, and
all documents relating thereto shall be legally sufficient under such laws or
regulations and shall be legally enforceable in accordance with their terms; (e)
except as described in writing to the Collateral Agent with respect to any
Accounts Receivable, except Accounts Receivable with an aggregate invoice amount
not in excess of $50,000, no agreement under which any deduction or offset of
any kind, other than normal trade discounts, may be granted or shall have been
made by such Loan Party at or before the time such Account Receivable is
created; (f) all agreements, instruments and other documents relating to any
Account Receivable shall be true and correct and in all material respects what
they purport to be; (g) all signatures and endorsements that appear on all
material agreements, instruments and other documents relating to any Account
Receivable shall be genuine and all signatories and endorsers shall have full
capacity to contract; (h) the Borrower shall maintain, and shall cause each of
its Subsidiaries to maintain, books and records pertaining to said Collateral in
such detail, form and scope as the Agents shall reasonably require; (i) the
Borrower shall immediately notify the Agents if Accounts Receivable of the
Borrower or any of its Subsidiaries with an aggregate invoice amount in excess
of $100,000 arise out of contracts with any Governmental Authority, and will use
commercially reasonable efforts to execute any instruments and take any steps
required by the Agents in order that all monies due or to become due under any
such contract shall be assigned to the Collateral Agent and notice thereof given
to such Governmental Authority under the Federal Assignment of Claims Act or any
similar state or local law; (j) the Borrower will, immediately upon learning
thereof, report to the Agents any material loss or destruction of, or
substantial damage to, any of the Collateral with a value in excess of $100,000,
and any other matters affecting the value, enforceability or collectibility of
any of the Collateral; (k) if any amount payable under or in connection with
Accounts Receivable with an aggregate invoice amount in excess of $50,000 is
evidenced by a promissory note or other instrument, such promissory note or
instrument shall be immediately pledged, endorsed, assigned and delivered to the
Collateral Agent for the benefit of the Lenders as additional Collateral; (l)
the Borrower shall not re-date, and shall not allow any of its Subsidiaries to
re-date, any invoice or sale or make sales on extended dating beyond that which
is customary in the ordinary course of its business and in the industry; (m) the
Borrower shall conduct a physical count of its Inventory and/or Equipment, or
the Inventory and/or Equipment of any of its Subsidiaries, as the case may be,
at such intervals as any Agent may request and such Loan Party shall promptly
supply the Agents with a copy of such count accompanied by a report of the value
(based on the lower of cost (on a first in first out basis) and market value) of
such Inventory and/or Equipment; and (n) the Borrower is not and shall not be
entitled to pledge, and shall not allow any of its Subsidiaries to pledge, any
Agent's or any Lender's credit on any purchases or for any purpose whatsoever.
Section 8.04 Collateral Custodian. Upon the occurrence and
during the continuance of any Default or Event of Default, the Collateral Agent
may at any time and from time to time employ and maintain on the premises of any
Loan Party a custodian selected by the Collateral Agent who shall have full
authority to do all acts necessary to protect the Agents' and the Lenders'
interests. Each Loan Party hereby agrees to, and to cause its Subsidiaries to,
cooperate with any such custodian and to do whatever the Collateral Agent may
reasonably
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request to preserve the Collateral. All reasonable costs and expenses incurred
by the Collateral Agent by reason of the employment of the custodian shall be
the responsibility of the Borrower and charged to the Loan Account.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.01 Events of Default. If any of the following
Events of Default shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of
or interest on any Loan, any Collateral Agent Advance, any Reimbursement
Obligation or any fee, indemnity or other amount payable under this Agreement or
any other Loan Document when due (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise);
(b) any representation or warranty made or deemed
made by or on behalf of any Loan Party or by any officer of the foregoing under
or in connection with any Loan Document or under or in connection with any
report, certificate, or other document delivered to any Agent, any Lender or the
L/C Issuer pursuant to any Loan Document shall have been incorrect in any
material respect when made or deemed made;
(c) any Loan Party shall fail to perform or comply
with any covenant or agreement contained in Sections 7.01(a)(i), (a)(ii),
(a)(vii), (a)(xiv), (a)(xv), (a)(xvi) or Sections 7.01(e), 7.01(g), 7.01(i),
7.01(j), 7.01(k) and 7.01(n), and such failure, if capable of being remedied,
shall remain unremedied for 10 days; any Loan Party shall fail to perform or
comply with any covenant or agreement contained in Sections 7.01(a)(iii),
(a)(viii), (a)(x), (a)(xi), (a)(xiii), Sections 7.01(c) or 7.01(f), and such
failure, if capable of being remedied, shall remain unremedied for 3 days; any
Loan Party shall fail to perform or comply with any covenant or agreement
contained in Sections 7.01(a)(iv), (a)(v), (a)(vi), (a)(ix) or (a)(xii),
Sections 7.01(b), 7.01(d), 7.01(h), 7.01(l), 7.01(m), 7.01(o), 7.01(p), 7.01(q)
or 7.01(r), Sections 7.02 or 7.03 or Article VIII; or any Loan Party shall fail
to perform or comply with any covenant or agreement contained in any Security
Agreement to which it is a party, any Pledge Agreement to which it is a party,
or any Mortgage to which it is a party;
(d) any Loan Party shall fail to perform or comply
with any other term, covenant or agreement contained in any Loan Document to be
performed or observed by it and, except as set forth in subsections (a), (b) and
(c) of this Section 9.01, such failure, if capable of being remedied, shall
remain unremedied for 20 days after the earlier of the date a senior officer of
any Loan Party becomes aware of such failure and the date written notice of such
default shall have been given by any Agent to such Loan Party;
(e) any Loan Party shall fail to pay any principal of
or interest on any of its Indebtedness (excluding Indebtedness evidenced by this
Agreement) in excess of $1,500,000, or any interest or premium thereon, when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such
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Indebtedness, or any other default under any agreement or instrument relating to
any such Indebtedness, or any other event, shall occur and shall continue after
the applicable grace period, if any, specified in such agreement or instrument,
if the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or any such Indebtedness
shall be declared to be due and payable, or required to be prepaid (other than
by a regularly scheduled required prepayment), redeemed, purchased or defeased
or an offer to prepay, redeem, purchase or defease such Indebtedness shall be
required to be made, in each case, prior to the stated maturity thereof;
(f) any Loan Party (i) shall institute any proceeding
or voluntary case seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for any such Person or for any substantial
part of its property, (ii) shall be generally not paying its debts as such debts
become due or shall admit in writing its inability to pay its debts generally,
(iii) shall make a general assignment for the benefit of creditors, or (iv)
shall take any action to authorize or effect any of the actions set forth above
in this subsection (f);
(g) any proceeding shall be instituted against any
Loan Party seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief of debtors, or seeking the entry of an order for relief or
the appointment of a receiver, trustee, custodian or other similar official for
any such Person or for any substantial part of its property, and either such
proceeding shall remain undismissed or unstayed for a period of 45 days or any
of the actions sought in such proceeding (including, without limitation, the
entry of an order for relief against any such Person or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property) shall occur;
(h) any provision of any Loan Document shall at any
time for any reason (other than pursuant to the express terms thereof) cease to
be valid and binding on or enforceable against any Loan Party intended to be a
party thereto or the validity or enforceability thereof shall be contested by
any party thereto, and such condition, if capable of being remedied, shall
remain unremedied for 3 days, or a proceeding shall be commenced by any Loan
Party or any Governmental Authority having jurisdiction over any of them,
seeking to establish the invalidity or unenforceability thereof, or any Loan
Party shall deny in writing that it has any liability or obligation purported to
be created under any Loan Document;
(i) any Security Agreement, any Pledge Agreement, any
Mortgage or any other security document, after delivery thereof pursuant hereto,
shall for any reason fail or cease to create a valid and perfected and, except
to the extent permitted by the terms hereof or thereof, first priority Lien in
favor of the Collateral Agent for the benefit of the Lenders on any Collateral
purported to be covered thereby, and such condition, if capable of being
remedied, shall remain unremedied for 3 days;
(j) one or more judgments or orders for the payment
of money exceeding $1,500,000 in the aggregate shall be rendered against any
Loan Party and remain
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unsatisfied and either (i) enforcement proceedings shall have been commenced by
any creditor upon any such judgment or order, or (ii) there shall be a period of
10 consecutive days after entry thereof during which a stay of enforcement of
any such judgment or order, by reason of a pending appeal or otherwise, shall
not be in effect; provided, however, that any such judgment or order shall not
give rise to an Event of Default under this subsection (j) if and for so long as
(A) the amount of such judgment or order is covered by a valid and binding
policy of insurance between the defendant and the insurer covering full payment
thereof and (B) such insurer has been notified, and has not disputed the claim
made for payment, of the amount of such judgment or order;
(k) any Loan Party is enjoined, restrained or in any
way prevented by the order of any court or any Governmental Authority from
conducting all or any material part of its business for more than fifteen (15)
days;
(l) any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike, lockout,
labor dispute, embargo, condemnation, act of God or public enemy, or other
casualty which causes, for more than fifteen (15) consecutive days, the
cessation or substantial curtailment of revenue producing activities at any
facility of any Loan Party, if any such event or circumstance could reasonably
be expected to have a Material Adverse Effect;
(m) the loss, suspension or revocation of, or failure
to renew, any license or permit now held or hereafter acquired by any Loan
Party, if such loss, suspension, revocation or failure to renew could reasonably
be expected to have a Material Adverse Effect;
(n) the indictment, or the threatened indictment of
any Loan Party under any criminal statute, or commencement or threatened
commencement of criminal or civil proceedings against any Loan Party, pursuant
to which statute or proceedings the penalties or remedies sought or available
include forfeiture to any Governmental Authority of any material portion of the
property of such Loan Party;
(o) any Loan Party or any of its ERISA Affiliates
shall have made a complete or partial withdrawal from a Multiemployer Plan, and,
as a result of such complete or partial withdrawal, any Loan Party or any of its
ERISA Affiliates incurs a withdrawal liability in an annual amount exceeding
$1,500,000; or a Multiemployer Plan enters reorganization status under Section
4241 of ERISA, and, as a result thereof any Loan Party's or any of its ERISA
Affiliates' annual contribution requirements with respect to such Multiemployer
Plan increases in an annual amount exceeding $1,500,000;
(p) any Termination Event with respect to any
Employee Plan shall have occurred, and, 30 days after notice thereof shall have
been given to any Loan Party by any Agent, (i) such Termination Event (if
correctable) shall not have been corrected, and (ii) the then current value of
such Employee Plan's vested benefits exceeds the then current value of assets
allocable to such benefits in such Employee Plan by more than $1,500,000 (or, in
the case of a Termination Event involving liability under Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 4971
or 4975 of the Internal Revenue Code, the liability is in excess of such
amount);
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(q) any Loan Party shall be liable for any
Environmental Liabilities or Costs the payment of which could reasonably be
expected to have a Material Adverse Effect;
(r) a Change of Control shall have occurred;
(s) an event or development occurs which could
reasonably be expected to have a Material Adverse Effect; or
(t) the Borrower fails to perform or observe any
condition or covenant or if an event of default or an event of termination shall
occur under the B of A Swap Documents, if the effect of such failure, condition
or event is to (x) cause, or to permit Bank of America, N.A. to cause the
Borrower's obligations under the B of A Swap Documents to be declared due and
payable prior to the stated maturity thereunder or (y) exercise enforcement
rights or remedies under the B of A Swap Documents, and such failure, event of
default or event of termination, if capable of being remedied, shall remain
unremedied for 5 Business Days;
then, and upon the occurrence and continuance of any such
event, the Collateral Agent may, and shall at the request of the Required
Lenders, by notice to the Borrower, (i) terminate or reduce all Commitments,
whereupon all Commitments shall immediately be so terminated or reduced, (ii)
declare all or any portion of the Loans and Reimbursement Obligations then
outstanding to be due and payable, whereupon all or such portion of the
aggregate principal of all Loans and Reimbursement Obligations, all accrued and
unpaid interest thereon, all fees and all other amounts payable under this
Agreement and the other Loan Documents shall become due and payable immediately,
without presentment, demand, protest, notice of acceleration, notice of intent
to accelerate or further notice of any kind, all of which are hereby expressly
waived by each Loan Party and (iii) exercise any and all of its other rights and
remedies under applicable law, hereunder and under the other Loan Documents;
provided, however, that upon the occurrence of any Event of Default described in
subsection (f) or (g) of this Section 9.01, without any notice to any Loan Party
or any other Person or any act by any Agent or any Lender, all Commitments shall
automatically terminate and all Loans and Reimbursement Obligations then
outstanding, together with all accrued and unpaid interest thereon, all fees and
all other amounts due under this Agreement and the other Loan Documents shall
become due and payable automatically and immediately, without presentment,
demand, protest, notice of acceleration, notice of intent to accelerate or
notice of any kind, all of which are expressly waived by each Loan Party. Upon
demand by the Administrative Agent during the continuation of any Event of
Default, the Borrower shall deposit with the Administrative Agent with respect
to each Letter of Credit then outstanding cash in an amount equal to 110% of the
greatest amount for which such Letter of Credit may be drawn. Such deposits
shall be held by the Administrative Agent in the Letter of Credit Collateral
Account as security for, and to provide for the payment of, the Letter of Credit
Obligations.
ARTICLE X
AGENTS
Section 10.01 Appointment. Each Lender (and each subsequent
maker of any Loan by its making thereof) hereby irrevocably appoints and
authorizes the Administrative
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Agent and the Collateral Agent to perform the duties of each such Agent as set
forth in this Agreement including: (i) to receive on behalf of each Lender any
payment of principal of or interest on the Loans outstanding hereunder and all
other amounts accrued hereunder for the account of the Lenders and paid to such
Agent, and, subject to Section 2.02 of this Agreement, to distribute promptly to
each Lender its Pro Rata Share of all payments so received; (ii) to distribute
to each Lender copies of all material notices and agreements received by such
Agent and not required to be delivered to each Lender pursuant to the terms of
this Agreement; provided that, the Agents shall not have any liability to the
Lenders for any Agent's inadvertent failure to distribute any such notices or
agreements to the Lenders; (iii) to maintain, in accordance with its customary
business practices, ledgers and records reflecting the status of the
Obligations, the Loans, and related matters and to maintain, in accordance with
its customary business practices, ledgers and records reflecting the status of
the Collateral and related matters; (iv) to execute or file any and all
financing or similar statements or notices, amendments, renewals, supplements,
documents, instruments, proofs of claim, notices and other written agreements
with respect to this Agreement or any other Loan Document; (v) to make the Loans
and Collateral Agent Advances, for such Agent or on behalf of the applicable
Lenders as provided in this Agreement or any other Loan Document; (vi) to
perform, exercise, and enforce any and all other rights and remedies of the
Lenders with respect to the Loan Parties, the Obligations, or otherwise related
to any of same to the extent reasonably incidental to the exercise by such Agent
of the rights and remedies specifically authorized to be exercised by such Agent
by the terms of this Agreement or any other Loan Document; (vii) to incur and
pay such fees necessary or appropriate for the performance and fulfillment of
its functions and powers pursuant to this Agreement or any other Loan Document;
and (viii) subject to Section 10.03 of this Agreement, to take such action as
such Agent deems appropriate on its behalf to administer the Loans and the Loan
Documents and to exercise such other powers delegated to such Agent by the terms
hereof or the other Loan Documents (including, without limitation, the power to
give or to refuse to give notices, waivers, consents, approvals and instructions
and the power to make or to refuse to make determinations and calculations)
together with such powers as are reasonably incidental thereto to carry out the
purposes hereof and thereof. As to any matters not expressly provided for by
this Agreement and the other Loan Documents (including, without limitation,
enforcement or collection of the Loans), the Agents shall not be required to
exercise any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions of the Required Lenders, and such
instructions of the Required Lenders shall be binding upon all Lenders and all
makers of Loans; provided, however, that the L/C Issuer shall not be required to
refuse to honor a drawing under any Letter of Credit and the Agents shall not be
required to take any action which, in the reasonable opinion of any Agent,
exposes such Agent to liability or which is contrary to this Agreement or any
other Loan Document or applicable law.
Section 10.02 Nature of Duties. The Agents shall have no
duties or responsibilities except those expressly set forth in this Agreement or
in the other Loan Documents. The duties of the Agents shall be mechanical and
administrative in nature. The Agents shall not have by reason of this Agreement
or any other Loan Document a fiduciary relationship in respect of any Lender.
Nothing in this Agreement or any other Loan Document, express or implied, is
intended to or shall be construed to impose upon the Agents any obligations in
respect of this Agreement or any other Loan Document except as expressly set
forth herein or therein. Each Lender shall make its own independent
investigation of the
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financial condition and affairs of the Loan Parties in connection with the
making and the continuance of the Loans hereunder and shall make its own
appraisal of the creditworthiness of the Loan Parties and the value of the
Collateral, and the Agents shall have no 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 their possession
before the initial Loan hereunder or at any time or times thereafter; provided
that, upon the reasonable request of a Lender, each Agent shall provide to such
Lender any documents or reports delivered to such Agent by the Loan Parties
pursuant to the terms of this Agreement or any other Loan Document. If any Agent
seeks the consent or approval of the Required Lenders to the taking or
refraining from taking any action hereunder, such Agent shall send notice
thereof to each Lender. Each Agent shall promptly notify each Lender any time
that the Required Lenders have instructed such Agent to act or refrain from
acting pursuant hereto.
Section 10.03 Rights, Exculpation, Etc. The Agents and their
directors, officers, agents or employees shall not be liable for any action
taken or omitted to be taken by them under or in connection with this Agreement
or the other Loan Documents, except for their own gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction. Without limiting the generality of the foregoing, the Agents: (i)
may treat the payee of any Loan as the owner thereof until the Collateral Agent
receives written notice of the assignment or transfer thereof, pursuant to
Section 11.07 hereof, signed by such payee and in form satisfactory to the
Collateral Agent; (ii) may consult with legal counsel (including, without
limitation, counsel to any Agent or counsel to the Loan Parties), independent
public accountants, and other experts selected by any of them and shall not be
liable for any action taken or omitted to be taken in good faith by any of them
in accordance with the advice of such counsel or experts; (iii) make no warranty
or representation to any Lender and shall not be responsible to any Lender for
any statements, certificates, warranties or representations made in or in
connection with this Agreement or the other Loan Documents; (iv) shall not have
any duty to ascertain or to inquire as to the performance or observance of any
of the terms, covenants or conditions of this Agreement or the other Loan
Documents on the part of any Person, the existence or possible existence of any
Default or Event of Default, or to inspect the Collateral or other property
(including, without limitation, the books and records) of any Person; (v) shall
not be responsible to any Lender for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or the other
Loan Documents or any other instrument or document furnished pursuant hereto or
thereto; and (vi) shall not be deemed to have made any representation or
warranty regarding the existence, value or collectibility of the Collateral, the
existence, priority or perfection of the Collateral Agent's Lien thereon, or any
certificate prepared by any Loan Party in connection therewith, nor shall the
Agents be responsible or liable to the Lenders for any failure to monitor or
maintain any portion of the Collateral. The Agents shall not be liable for any
apportionment or distribution of payments made in good faith pursuant to Section
4.04, and if any such apportionment or distribution is subsequently determined
to have been made in error the sole recourse of any Lender to whom payment was
due but not made, shall be to recover from other Lenders any payment in excess
of the amount which they are determined to be entitled. The Agents may at any
time request instructions from the Lenders with respect to any actions or
approvals which by the terms of this Agreement or of any of the other Loan
Documents the Agents are permitted or required to take or to grant, and if such
instructions are promptly requested, the Agents shall be absolutely entitled to
refrain from taking any action or to withhold any approval under any of the Loan
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Documents until they shall have received such instructions from the Required
Lenders. Without limiting the foregoing, no Lender shall have any right of
action whatsoever against any Agent as a result of such Agent acting or
refraining from acting under this Agreement or any of the other Loan Documents
in accordance with the instructions of the Required Lenders.
Section 10.04 Reliance. Each Agent shall be entitled to rely
upon any written notices, statements, certificates, orders or other documents or
any telephone message believed by it in good faith to be genuine and correct and
to have been signed, sent or made by the proper Person, and with respect to all
matters pertaining to this Agreement or any of the other Loan Documents and its
duties hereunder or thereunder, upon advice of counsel selected by it.
Section 10.05 Indemnification. To the extent that any Agent or
the L/C Issuer is not reimbursed and indemnified by any Loan Party, the Lenders
will reimburse and indemnify such Agent and the L/C Issuer from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses, advances or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against such
Agent or the L/C Issuer in any way relating to or arising out of this Agreement
or any of the other Loan Documents or any action taken or omitted by such Agent
or the L/C Issuer under this Agreement or any of the other Loan Documents, in
proportion to each Lender's Pro Rata Share, including, without limitation,
advances and disbursements made pursuant to Section 10.08; provided, however,
that no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses, advances
or disbursements for which there has been a final judicial determination that
such liability resulted from such Agent's or the L/C Issuer's gross negligence
or willful misconduct. The obligations of the Lenders under this Section 10.05
shall survive the payment in full of the Loans and the termination of this
Agreement.
Section 10.06 Agents Individually. With respect to its Pro
Rata Share of the Total Commitment hereunder and the Loans made by it, each
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 maker of a Loan. The terms "Lenders" or "Required
Lenders" or any similar terms shall, unless the context clearly otherwise
indicates, include each Agent in its individual capacity as a Lender or one of
the Required Lenders. Each Agent and its Affiliates may accept deposits from,
lend money to, and generally engage in any kind of banking, trust or other
business with the Borrower as if it were not acting as an Agent pursuant hereto
without any duty to account to the other Lenders.
Section 10.07 Successor Agent. (a) Each Agent may resign from
the performance of all its functions and duties hereunder and under the other
Loan Documents at any time by giving at least thirty (30) Business Days' prior
written notice to the Borrower and each Lender. Such resignation shall take
effect upon the acceptance by a successor 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 shall, subject to the consent of the Borrower when no Event of Default
has occurred or is continuing (which consent shall not be unreasonably withheld
or delayed) appoint a successor Agent. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor
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Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement and the other
Loan Documents. After any Agent's resignation hereunder as an Agent, the
provisions of this Article X shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was an Agent under this Agreement and the
other Loan Documents.
(c) If a successor Agent shall not have been so
appointed within said thirty (30) Business Day period, the retiring Agent, with
the consent of the other Agent shall then appoint a successor Agent who shall
serve as an Agent until such time, if any, as the Required Lenders, with the
consent of the other Agent, appoint a successor Agent as provided above.
Section 10.08 Collateral Matters.
(a) The Collateral Agent may from time to time make
such disbursements and advances ("Collateral Agent Advances") which the
Collateral Agent, in its reasonable business judgment, deems necessary or
desirable to preserve, protect, prepare for sale or lease or dispose of the
Collateral or any portion thereof, to enhance the likelihood or maximize the
amount of repayment by the Borrower of the Loans, Reimbursement Obligations,
Letter of Credit Obligations and other Obligations, to pay any other amount
chargeable to the Borrower pursuant to the terms of this Agreement, including,
without limitation, costs, fees and expenses as described in Section 11.04 or to
make any payment pursuant to Paragraph 16 of the B of A Intercreditor Agreement.
The Collateral Agent Advances shall be repayable on demand and be secured by the
Collateral. The Collateral Agent Advances shall constitute Obligations hereunder
which may be charged to the Loan Account in accordance with Section 4.02. The
Collateral Agent shall notify each Lender and the Borrower in writing of each
such Collateral Agent Advance, which notice shall include a description of the
purpose of such Collateral Agent Advance. Without limitation to its obligations
pursuant to Section 10.05, each Lender agrees that it shall make available to
the Collateral Agent, upon the Collateral Agent's demand, in Dollars in
immediately available funds, the amount equal to such Lender's Pro Rata Share of
each such Collateral Agent Advance. If such funds are not made available to the
Collateral Agent by such Lender, the Collateral Agent shall be entitled to
recover such funds on demand from such Lender, together with interest thereon
for each day from the date such payment was due until the date such amount is
paid to the Collateral Agent, at the Federal Funds Rate for three Business Days
and thereafter at the Reference Rate.
(b) The Lenders hereby irrevocably authorize the
Collateral Agent, at its option and in its discretion, to release any Lien
granted to or held by the Collateral Agent upon any Collateral upon termination
of the Total Commitment and payment and satisfaction of all Loans, Reimbursement
Obligations, Letter of Credit Obligations, and all other Obligations which have
matured and which the Collateral Agent has been notified in writing are then due
and payable; or constituting property being sold or disposed of in the ordinary
course of any Loan Party's business and in compliance with the terms of this
Agreement and the other Loan Documents; or constituting property in which the
Loan Parties owned no interest at the time the Lien was granted or at any time
thereafter; or if approved, authorized or ratified in writing by the Lenders.
Upon request by the Collateral Agent at any time, the Lenders will confirm in
writing
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the Collateral Agent's authority to release particular types or items of
Collateral pursuant to this Section 10.08(b).
(c) Without in any manner limiting the Collateral
Agent's authority to act without any specific or further authorization or
consent by the Lenders (as set forth in Section 10.08(b)), each Lender agrees to
confirm in writing, upon request by the Collateral Agent, the authority to
release Collateral conferred upon the Collateral Agent under Section 10.08(b).
Upon receipt by the Collateral Agent of confirmation from the Lenders of its
authority to release any particular item or types of Collateral, and upon prior
written request by any Loan Party, the Collateral Agent shall (and is hereby
irrevocably authorized by the Lenders to) execute such documents as may be
necessary to evidence the release of the Liens granted to the Collateral Agent
for the benefit of the Lenders upon such Collateral; provided, however, that (i)
the Collateral Agent shall not be required to execute any such document on terms
which, in the Collateral Agent's opinion, would expose the Collateral Agent to
liability or create any obligations or entail any consequence other than the
release of such Liens without recourse or warranty, and (ii) such release shall
not in any manner discharge, affect or impair the Obligations or any Lien upon
(or obligations of any Loan Party in respect of) all interests in the Collateral
retained by any Loan Party.
(d) The Collateral Agent shall have no obligation
whatsoever to any Lender to assure that the Collateral exists or is owned by the
Loan Parties or is cared for, protected or insured or has been encumbered or
that the Lien granted to the Collateral Agent pursuant to this Agreement or any
other Loan Document has been properly or sufficiently or lawfully created,
perfected, protected or enforced or is entitled to any particular priority, or
to exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to the Collateral Agent in this
Section 10.08 or in any other Loan Document, it being understood and agreed that
in respect of the Collateral, or any act, omission or event related thereto, the
Collateral Agent may act in any manner it may deem appropriate, in its sole
discretion, given the Collateral Agent's own interest in the Collateral as one
of the Lenders and that the Collateral Agent shall have no duty or liability
whatsoever to any other Lender, except as otherwise provided herein.
Section 10.09 Agency for Perfection. Each Lender hereby
appoints each Agent and each other Lender as agent and bailee for the purpose of
perfecting the security interests in and liens upon the Collateral in assets
which, in accordance with Article 9 of the Uniform Commercial Code, can be
perfected only by possession or control (or where the security interest of a
secured party with possession or control has priority over the security interest
of another secured party) and each Agent and each Lender hereby acknowledges
that it holds possession or control, as the case may be, of any such Collateral
for the benefit of the Collateral Agent as secured party. Should any Lender
obtain possession or control of any such Collateral, such Lender shall notify
the Collateral Agent thereof, and, promptly upon the Collateral Agent's request
therefor shall deliver such Collateral to the Collateral Agent or in accordance
with the Collateral Agent's instructions. Each Loan Party by its execution and
delivery of this Agreement hereby consents to the foregoing.
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ARTICLE XI
MISCELLANEOUS
Section 11.01 Notices, Etc. All notices and other communications provided for
hereunder shall be in writing and shall be mailed, telecopied or delivered, if
to any Loan Party, at the following address:
Packaged Ice, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇, L.L.P.
Frost Bank Plaza
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
if to the Administrative Agent or to the Collateral Agent, to
it at the following address:
Ableco Finance LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: 212-909-1421
in each case, with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other parties complying as to delivery with the terms
of this Section 11.01. All such
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notices and other communications shall be effective, (i) if mailed, when
received or three days after deposited in the mails, whichever occurs first,
(ii) if telecopied, when transmitted and confirmation received, or (iii) if
delivered, upon delivery, except that notices to any Agent or the L/C Issuer
pursuant to Articles II and III shall not be effective until received by such
Agent or the L/C Issuer, as the case may be.
Section 11.02 Amendments, Etc. (a) No amendment or waiver of
any provision of this Agreement, and no consent to any departure by any Loan
Party therefrom, shall in any event be effective unless the same shall be in
writing and signed by the Required Lenders or by the Collateral Agent with the
consent of the Required Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given, provided, however, that no amendment, waiver or consent shall (i)
increase the Commitment of any Lender, reduce the principal of, or interest on,
the Loans or the Reimbursement Obligations payable to any Lender, reduce the
amount of any fee payable for the account of any Lender, or postpone or extend
any date fixed for any payment of principal of, or interest or fees on, the
Loans or Letter of Credit Obligations payable to any Lender, in each case
without the written consent of any Lender affected thereby, (ii) increase the
Total Commitment without the written consent of each Lender, (iii) change the
percentage of the Commitments or of the aggregate unpaid principal amount of the
Loans that is required for the Lenders or any of them to take any action
hereunder, (iv) amend the definition of "Required Lenders" or "Pro Rata Share",
(v) release all or a substantial portion of the Collateral (except as otherwise
provided in this Agreement and the other Loan Documents), subordinate any Lien
granted in favor of the Collateral Agent for the benefit of the Lenders, or
release the Borrower or any Guarantor, (vi) amend, modify or waive Section 4.04
or this Section 11.02 of this Agreement, or (vii) amend the definition of "Net
Book Value", "Net Orderly Liquidation Value", "Borrowing Base", "Dilution",
"Dilution Reserve", "Eligible Accounts Receivable", "Eligible Equipment", "Net
Amount of Eligible Accounts Receivable", or "M&E Component", in each case,
without the written consent of each Lender. Notwithstanding the foregoing, no
amendment, waiver or consent shall, unless in writing and signed by an Agent,
affect the rights or duties of such Agent (but not in its capacity as a Lender)
under this Agreement or the other Loan Documents.
(b) The Administrative Agent, the Collateral Agent,
Ableco and its Affiliates and the other Lenders may execute an agreement
pursuant to which such Persons agree, among other things, to certain voting
arrangements relative to matters requiring the approval of the Lenders. The
rights and duties of the Administrative Agent, the Collateral Agent, and Ableco
and its Affiliates and the other Lenders, with respect to such matters, are
subject to such Agreement.
Section 11.03 No Waiver; Remedies, Etc. No failure on the part
of any Agent or any Lender to exercise, and no delay in exercising, any right
hereunder or under any other Loan Document shall operate as a waiver thereof;
nor shall any single or partial exercise of any right under any Loan Document
preclude any other or further exercise thereof or the exercise of any other
right. The rights and remedies of the Agents and the Lenders provided herein and
in the other Loan Documents are cumulative and are in addition to, and not
exclusive of, any rights or remedies provided by law. The rights of the Agents
and the Lenders under any Loan Document against any party thereto are not
conditional or contingent on any attempt by the
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Agents and the Lenders to exercise any of their rights under any other Loan
Document against such party or against any other Person.
Section 11.04 Expenses; Taxes; Attorneys' Fees. Subject to the
limitations contained in Section 7.01(f) (to the extent Section 7.01(f) is
applicable), the Borrower will pay on demand, all reasonable out-of-pocket costs
and expenses incurred by or on behalf of each Agent (and, in the case of clauses
(b) through (m) below, each Lender), regardless of whether the transactions
contemplated hereby are consummated, including, without limitation, reasonable
fees, costs, client charges and expenses of counsel for each Agent (and, in the
case of clauses (b) through (m) below, each Lender), accounting, due diligence,
periodic field audits, physical counts, valuations, investigations, searches and
filings, monitoring of assets, appraisals of Collateral, title searches and
reviewing environmental assessments, miscellaneous disbursements, examination,
travel, lodging and meals, arising from or relating to: (a) the negotiation,
preparation, execution, delivery, performance and administration of this
Agreement and the other Loan Documents (including, without limitation, the
preparation of any additional Loan Documents pursuant to Section 7.01(b) or the
review of any of the agreements, instruments and documents referred to in
Section 7.01(f)), (b) any requested amendments, waivers or consents to this
Agreement or the other Loan Documents whether or not such documents become
effective or are given, (c) the preservation and protection of any of the
Lenders' rights under this Agreement or the other Loan Documents, (d) the
defense of any claim or action asserted or brought against any Agent or any
Lender by any Person that arises from or relates to this Agreement, any other
Loan Document, the Agents' or the Lenders' claims against any Loan Party, or any
and all matters in connection therewith, (e) the commencement or defense of, or
intervention in, any court proceeding arising from or related to this Agreement
or any other Loan Document, (f) the filing of any petition, complaint, answer,
motion or other pleading by any Agent or any Lender, or the taking of any action
in respect of the Collateral or other security, in connection with this
Agreement or any other Loan Document, (g) the protection, collection, lease,
sale, taking possession of or liquidation of, any Collateral or other security
in connection with this Agreement or any other Loan Document, (h) any attempt to
enforce any Lien or security interest in any Collateral or other security in
connection with this Agreement or any other Loan Document, (i) any attempt to
collect from any Loan Party, (j) all liabilities and costs arising from or in
connection with the past, present or future operations of any Loan Party
involving any damage to real or personal property or natural resources or harm
or injury alleged to have resulted from any Release of Hazardous Materials on,
upon or into such property, (k) any Environmental Liabilities and Costs incurred
in connection with the investigation, removal, cleanup and/or remediation of any
Hazardous Materials present or arising out of the operations of any facility of
any Loan Party, (l) any Environmental Liabilities and Costs incurred in
connection with any Environmental Lien, or (m) the receipt by any Agent or any
Lender of any advice from professionals with respect to any of the foregoing.
Without limitation of the foregoing or any other provision of any Loan Document:
(x) the Borrower agrees to pay all stamp, document, transfer, recording or
filing taxes or fees and similar impositions now or hereafter determined by any
Agent or any Lender to be payable in connection with this Agreement or any other
Loan Document, and the Borrower agrees to save each Agent and each Lender
harmless from and against any and all present or future claims, liabilities or
losses with respect to or resulting from any omission to pay or delay in paying
any such taxes, fees or impositions, and (y) if the Borrower fails to perform
any covenant or agreement contained herein or in any other Loan Document, any
Agent may itself perform or cause performance of such
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covenant or agreement, and the expenses of such Agent incurred in connection
therewith shall be reimbursed on demand by the Borrower.
Section 11.05 Right of Set-off. Upon the occurrence and during
the continuance of any Event of Default, any Agent or any Lender may, and is
hereby authorized to, at any time and from time to time, without notice to any
Loan Party (any such notice being expressly waived by the Loan Parties) and to
the fullest extent permitted by law, set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other Indebtedness at any time owing by such Agent or such Lender to or for the
credit or the account of any Loan Party against any and all obligations of the
Loan Parties either now or hereafter existing under any Loan Document,
irrespective of whether or not such Agent or such Lender shall have made any
demand hereunder or thereunder and although such obligations may be contingent
or unmatured. Each Lender agrees to notify such Loan Party promptly after any
such set-off and application made by such Agent or such Lender; provided that
the failure to give such notice shall not affect the validity of such set-off
and application. The rights of the Agents and the Lenders under this Section
11.05 are in addition to the other rights and remedies (including other rights
of set-off) which the Agents and the Lenders may have under this Agreement or
any other Loan Documents of law or otherwise.
Section 11.06 Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining portions hereof or affecting
the validity or enforceability of such provision in any other jurisdiction.
Section 11.07 Assignments and Participations. (a) This
Agreement and the other Loan Documents shall be binding upon and inure to the
benefit of each Loan Party and each Agent and each Lender and their respective
successors and assigns; provided, however, that none of the Loan Parties may
assign or transfer any of its rights hereunder without the prior written consent
of each Lender and any such assignment without the Lenders' prior written
consent shall be null and void.
(b) Each Lender may, with the written consent of the
Collateral Agent, assign to one or more other lenders or other entities all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments, the Loans made by it and its
Pro Rata Share of Letter of Credit Obligations); provided, however, that (i)
such assignment is in an amount which is at least $5,000,000 or a multiple of
$1,000,000 in excess thereof (or the remainder of such Lender's Commitment)
(except such minimum amount shall not apply to any Affiliate of a Lender or a
fund or account managed by a Lender), (ii) the assignee agrees to be bound by
the terms of the agreement among Lenders referred to in Section 11.02(b), and
(iii) the parties to each such assignment shall execute and deliver to the
Collateral Agent, for its acceptance, an Assignment and Acceptance, together
with any promissory note subject to such assignment and such parties shall
deliver to the Collateral Agent a processing and recordation fee of $5,000
(except the payment of such fee shall not be required if the assignee is an
Affiliate of a Lender or a fund or account managed by a Lender). Upon such
execution, delivery and acceptance, from and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least three
Business Days after the delivery thereof to the Collateral Agent (or such
shorter period as shall be agreed to by the
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Collateral Agent and the parties to such assignment), (A) the assignee
thereunder shall become a "Lender" hereunder and, in addition to the rights and
obligations hereunder held by it immediately prior to such effective date, have
the rights and obligations hereunder that have been assigned to it pursuant to
such Assignment and Acceptance and (B) the assigning Lender thereunder shall, to
the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations (other than those under Section 11.19) under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto).
(i) By executing and delivering an
Assignment and Acceptance, the assigning Lender and the assignee thereunder
confirm to and agree with each other and the other parties hereto as follows:
(A) other than as provided in such Assignment and Acceptance, the assigning
Lender makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement or any other Loan Document or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or any other Loan Document furnished pursuant hereto; (B) the
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Loan Party or any
of its Subsidiaries or the performance or observance by any Loan Party of any of
its obligations under this Agreement or any other Loan Document furnished
pursuant hereto; (C) such assignee confirms that it has received a copy of this
Agreement and the other Loan Documents, together with such other documents and
information it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (D) such assignee will,
independently and without reliance upon the assigning Lender, any Agent or any
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 this Agreement and the other Loan Documents; (E) such assignee
appoints and authorizes the Agents to take such action as agents on its behalf
and to exercise such powers under this Agreement and the other Loan Documents as
are delegated to the Agents by the terms hereof and thereof, together with such
powers as are reasonably incidental hereto and thereto; and (F) such assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement and the other Loan Documents
are required to be performed by it as a Lender.
(ii) The Borrower authorizes the Collateral
Agent, and the Collateral Agent agrees, to maintain, or cause to be maintained
at the Payment Office, a copy of each Assignment and Acceptance delivered to and
accepted by it and a register (the "Register") for the recordation of the names
and addresses of the Lenders and the Commitments of, and principal amount of the
Loans (the "Registered Loans") and Letter of Credit Obligations owing to each
Lender from time to time. The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Borrower, the Agents
and the Lenders may treat each Person whose name is recorded in the Register as
a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower and any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(iii) Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an assignee, together with any
promissory notes subject to
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such assignment, the Collateral Agent shall, if the Collateral Agent consents to
such assignment and if such Assignment and Acceptance has been completed (i)
accept such Assignment and Acceptance and (ii) record the information contained
therein in the Register.
(iv) A Registered Loan (and the registered
note, if any, evidencing the same) may be assigned or sold in whole or in part
only by registration of such assignment or sale on the Register (and each
registered note shall expressly so provide). Any assignment or sale of all or
part of such Registered Loan (and the registered note, if any, evidencing the
same) may be effected only by registration of such assignment or sale on the
Register, together with the surrender of the registered note, if any, evidencing
the same duly endorsed by (or accompanied by a written instrument of assignment
or sale duly executed by) the holder of such registered note, whereupon, at the
request of the designated assignee(s) or transferee(s), one or more new
registered notes in the same aggregate principal amount shall be issued to the
designated assignee(s) or transferee(s). Prior to the registration of assignment
or sale of any Registered Loan (and the registered note, if any, evidencing the
same), the Agents shall treat the Person in whose name such Registered Loan (and
the registered note, if any, evidencing the same) is registered as the owner
thereof for the purpose of receiving all payments thereon and for all other
purposes, notwithstanding notice to the contrary.
(v) In the event that any Lender sells
participations in a Registered Loan, such Lender shall maintain a register on
which it enters the name of all participants in the Registered Loans held by it
(the "Participant Register"). A Registered Loan (and the registered note, if
any, evidencing the same) may be participated in whole or in part only by
registration of such participation on the Participant Register (and each
registered note shall expressly so provide). Any participation of such
Registered Loan (and the registered note, if any, evidencing the same) may be
effected only by the registration of such participation on the Participant
Register.
(vi) Any foreign Person who purchases or is
assigned or participates in any portion of such Registered Loan shall provide
the Agents (in the case of a purchase or assignment) or the Lender (in the case
of a participation) with a completed Internal Revenue Service Form W-8BEN
(Certificate of Foreign Status) or a substantially similar form for such
purchaser, participant or any other affiliate who is a holder of beneficial
interests in the Registered Loan.
(c) Each Lender may sell participations to one or
more banks or other entities in or to all or a portion of its rights and
obligations under this Agreement and the other Loan Documents (including,
without limitation, all or a portion of its Commitments, the Loans made by it
and its Pro Rata Share of the Letter of Credit Obligations); provided, that (i)
such Lender's obligations under this Agreement (including without limitation,
its Commitments hereunder) and the other Loan Documents shall remain unchanged;
(ii) such Lender shall remain solely responsible to the other parties hereto for
the performance of such obligations, and the Borrower, the Agents and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement and
the other Loan Documents; and (iii) a participant shall not be entitled to
require such Lender to take or omit to take any action hereunder except (A)
action directly effecting an extension of the maturity dates or decrease in the
principal amount of the Loans or Letter of Credit Obligations,
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(B) action directly effecting an extension of the due dates or a decrease in the
rate of interest payable on the Loans or the fees payable under this Agreement,
or (C) actions directly effecting a release of all or a substantial portion of
the Collateral or the Borrower or any Guarantor (except as set forth in Section
10.08 of this Agreement or any other Loan Document). The Loan Parties agree that
each participant shall be entitled to the benefits of Section 2.08 and Section
4.05 of this Agreement with respect to its participation in any portion of the
Commitments and the Loans as if it was a Lender.
Section 11.08 Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of this Agreement by telefacsimile shall be equally as
effective as delivery of an original executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by telefacsimile also
shall deliver an original executed counterpart of this Agreement but the failure
to deliver an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Agreement. The foregoing shall apply
to each other Loan Document mutatis mutandis.
Section 11.09 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN
RESPECT OF SUCH OTHER LOAN DOCUMENT) SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK.
Section 11.10 CONSENT TO JURISDICTION; SERVICE OF PROCESS AND
VENUE. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN ▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ IN THE
COUNTY OF NEW YORK OR OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH
LOAN PARTY HEREBY IRREVOCABLY ACCEPTS IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH LOAN PARTY
HEREBY IRREVOCABLY APPOINTS THE SECRETARY OF STATE OF THE STATE OF NEW YORK AS
ITS AGENT FOR SERVICE OF PROCESS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING AND
FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS AND IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF
COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE BORROWER
AT ITS ADDRESS FOR NOTICES AS SET FORTH IN SECTION 11.01 AND TO THE SECRETARY OF
STATE OF THE STATE OF NEW YORK, SUCH SERVICE TO BECOME EFFECTIVE TEN (10) DAYS
AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENTS AND THE
LENDERS TO SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY LOAN PARTY IN ANY
OTHER JURISDICTION. EACH LOAN PARTY HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR
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HEREAFTER HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY SUCH LITIGATION
BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH
LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY
LOAN PARTY HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY
COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT
PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, EACH LOAN PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY
IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
Section 11.11 WAIVER OF JURY TRIAL, ETC. EACH LOAN PARTY, EACH
AGENT AND EACH LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT,
DOCUMENT OR OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN
CONNECTION THEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH LOAN
PARTY CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ANY AGENT
OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT ANY AGENT OR ANY
LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK
TO ENFORCE THE FOREGOING WAIVERS. EACH LOAN PARTY HEREBY ACKNOWLEDGES THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENTS AND THE LENDERS ENTERING INTO
THIS AGREEMENT.
Section 11.12 Consent by the Agents and Lenders. Except as
otherwise expressly set forth herein to the contrary, if the consent, approval,
satisfaction, determination, judgment, acceptance or similar action (an
"Action") of any Agent or any Lender shall be permitted or required pursuant to
any provision hereof or any provision of any other agreement to which any Loan
Party is a party and to which any Agent or any Lender has succeeded thereto,
such Action shall be required to be in writing and may be withheld or denied by
such Agent or such Lender, in its sole discretion, with or without any reason,
and without being subject to question or challenge on the grounds that such
Action was not taken in good faith.
Section 11.13 No Party Deemed Drafter. Each of the parties
hereto agrees that no party hereto shall be deemed to be the drafter of this
Agreement.
Section 11.14 Reinstatement; Certain Payments. If any claim is
ever made upon any Agent, any Lender or the L/C Issuer for repayment or recovery
of any amount or amounts received by such Agent, such Lender or the L/C Issuer
in payment or on account of any of the Obligations, such Agent, such Lender or
the L/C Issuer shall give prompt notice of such claim to each other Agent and
Lender and the Borrower, and if such Agent, such Lender or the L/C Issuer repays
all or part of such amount by reason of (i) any judgment, decree or order of
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any court or administrative body having jurisdiction over such Agent, such
Lender or the L/C Issuer or any of its property, or (ii) any good faith
settlement or compromise of any such claim effected by such Agent, such Lender
or the L/C Issuer with any such claimant, then and in such event each Loan Party
agrees that (A) any such judgment, decree, order, settlement or compromise shall
be binding upon it notwithstanding the cancellation of any Indebtedness
hereunder or under the other Loan Documents or the termination of this Agreement
or the other Loan Documents, and (B) it shall be and remain liable to such
Agent, such Lender or the L/C Issuer hereunder for the amount so repaid or
recovered to the same extent as if such amount had never originally been
received by such Agent, such Lender or the L/C Issuer.
Section 11.15 Indemnification. In addition to each Loan
Party's other Obligations under this Agreement, each Loan Party agrees to,
jointly and severally, defend, protect, indemnify and hold harmless each Agent,
each Lender and the L/C Issuer and all of their respective officers, directors,
employees, attorneys, consultants and agents (collectively called the
"Indemnitees") from and against any and all losses, damages, liabilities,
obligations, penalties, fees, reasonable costs and expenses (including, without
limitation, reasonable attorneys' fees, costs and expenses) incurred by such
Indemnitees, whether prior to or from and after the Effective Date, whether
direct, indirect or consequential, as a result of or arising from or relating to
or in connection with any of the following: (i) the negotiation, preparation,
execution or performance or enforcement of this Agreement, any other Loan
Document or of any other document executed in connection with the transactions
contemplated by this Agreement, (ii) any Agent's or any Lender's furnishing of
funds to the Borrower or the L/C Issuer's issuing of Letters of Credit for the
account of the Borrower under this Agreement or the other Loan Documents,
including, without limitation, the management of any such Loans, the
Reimbursement Obligations or the Letter of Credit Obligations, (iii) any matter
relating to the financing transactions contemplated by this Agreement or the
other Loan Documents or by any document executed in connection with the
transactions contemplated by this Agreement or the other Loan Documents, (iv)
any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto, or (v) any payments
the Collateral Agent makes pursuant to Paragraph 16 of the B of A Intercreditor
Agreement (collectively, the "Indemnified Matters"); provided, however, that the
Loan Parties shall not have any obligation to any Indemnitee under this Section
11.15 for any Indemnified Matter caused by the gross negligence or willful
misconduct of an Indemnitee or any of its officers, directors, employees or
agents, as determined by a final judgment of a court of competent jurisdiction.
Such indemnification for all of the foregoing losses, damages, fees, costs and
expenses of the Indemnitees are chargeable against the Loan Account. To the
extent that the undertaking to indemnify, pay and hold harmless set forth in
this Section 11.15 may be unenforceable because it is violative of any law or
public policy, each Loan Party shall, jointly and severally, contribute the
maximum portion which it is permitted to pay and satisfy under applicable law,
to the payment and satisfaction of all Indemnified Matters incurred by the
Indemnitees. This Indemnity shall survive the repayment of the Obligations and
the discharge of the Liens granted under the Loan Documents.
Section 11.16 Records. The unpaid principal of and interest on
the Loans, the interest rate or rates applicable to such unpaid principal and
interest, the duration of such applicability, the Commitments, and the accrued
and unpaid fees payable pursuant to Section 2.06 hereof, including, without
limitation, the Closing Fee, Loan Servicing Fee, the Anniversary
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Fee, the Unused Line Fee, the Letter of Credit Fee and Commitment Fee, shall at
all times be ascertained from the records of the Agents, which shall be
conclusive and binding absent manifest error.
Section 11.17 Binding Effect. This Agreement shall become
effective when it shall have been executed by each Loan Party, each Agent and
each Lender and when the conditions precedent set forth in Section 5.01 hereof
have been satisfied or waived in writing by the Agents, and thereafter shall be
binding upon and inure to the benefit of each Loan Party, each Agent and each
Lender, and their respective successors and assigns, except that the Loan
Parties shall not have the right to assign their rights hereunder or any
interest herein without the prior written consent of each Lender, and any
assignment by any Lender shall be governed by Section 11.07 hereof.
Section 11.18 Interest. It is the intention of the parties
hereto that each Agent and each Lender shall conform strictly to usury laws
applicable to it. Accordingly, if the transactions contemplated hereby or by any
other Loan Document would be usurious as to any Agent or any Lender under laws
applicable to it (including the laws of the United States of America and the
State of New York or any other jurisdiction whose laws may be mandatorily
applicable to such Agent or such Lender notwithstanding the other provisions of
this Agreement), then, in that event, notwithstanding anything to the contrary
in this Agreement or any other Loan Document or any agreement entered into in
connection with or as security for the Obligations, it is agreed as follows: (i)
the aggregate of all consideration which constitutes interest under law
applicable to any Agent or any Lender that is contracted for, taken, reserved,
charged or received by such Agent or such Lender under this Agreement or any
other Loan Document or agreements or otherwise in connection with the
Obligations shall under no circumstances exceed the maximum amount allowed by
such applicable law, any excess shall be canceled automatically and if
theretofore paid shall be credited by such Agent or such Lender on the principal
amount of the Obligations (or, to the extent that the principal amount of the
Obligations shall have been or would thereby be paid in full, refunded by such
Agent or such Lender, as applicable, to the Borrower); and (ii) in the event
that the maturity of the Obligations is accelerated by reason of any Event of
Default under this Agreement or otherwise, or in the event of any required or
permitted prepayment, then such consideration that constitutes interest under
law applicable to any Agent or any Lender may never include more than the
maximum amount allowed by such applicable law, and excess interest, if any,
provided for in this Agreement or otherwise shall be canceled automatically by
such Agent or such Lender, as applicable, as of the date of such acceleration or
prepayment and, if theretofore paid, shall be credited by such Agent or such
Lender, as applicable, on the principal amount of the Obligations (or, to the
extent that the principal amount of the Obligations shall have been or would
thereby be paid in full, refunded by such Agent or such Lender to the Borrower).
All sums paid or agreed to be paid to any Agent or any Lender for the use,
forbearance or detention of sums due hereunder shall, to the extent permitted by
law applicable to such Agent or such Lender, be amortized, prorated, allocated
and spread throughout the full term of the Loans until payment in full so that
the rate or amount of interest on account of any Loans hereunder does not exceed
the maximum amount allowed by such applicable law. If at an time and from time
to time (i) the amount of interest payable to any Agent or any Lender on any
date shall be computed at the Highest Lawful Rate applicable to such Agent or
such Lender pursuant to this Section 11.18 and (ii) in respect of any subsequent
interest computation period the amount of interest otherwise
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payable to such Agent or such Lender would be less than the amount of interest
payable to such Agent or such Lender computed at the Highest Lawful Rate
applicable to such Agent or such Lender, then the amount of interest payable to
such Agent or such Lender in respect of such subsequent interest computation
period shall continue to be computed at the Highest Lawful Rate applicable to
such Agent or such Lender until the total amount of interest payable to such
Agent or such Lender shall equal the total amount of interest which would have
been payable to such Agent or such Lender if the total amount of interest had
been computed without giving effect to this Section 11.18.
For purposes of this Section 11.18, the term "applicable law"
shall mean that law in effect from time to time and applicable to the loan
transaction between the Borrower, on the one hand, and the Agents and the
Lenders, on the other, that lawfully permits the charging and collection of the
highest permissible, lawful non-usurious rate of interest on such loan
transaction and this Agreement, including laws of the State of New York and, to
the extent controlling, laws of the United States of America.
The right to accelerate the maturity of the Obligations does
not include the right to accelerate any interest that has not accrued as of the
date of acceleration.
Section 11.19 Confidentiality. Each Agent and each Lender
agrees (on behalf of itself and each of its affiliates, directors, officers,
employees and representatives) to use reasonable precautions to keep
confidential, in accordance with its customary procedures for handling
confidential information of this nature and in accordance with safe and sound
practices of comparable commercial finance companies, any non-public information
supplied to it by the Loan Parties pursuant to this Agreement or the other Loan
Documents which is identified in writing by the Loan Parties as being
confidential at the time the same is delivered to such Person (and which at the
time is not, and does not thereafter become, publicly available or available to
such Person from another source not known to be subject to a confidentiality
obligation to such Person not to disclose such information), provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for any Agent or any Lender, (iii) to examiners, auditors, accountants
or Securitization Parties, (iv) in connection with any litigation to which any
Agent or any Lender is a party or (v) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first agrees, in writing, to be bound by
confidentiality provisions similar in substance to this Section 11.19. Each
Agent and each Lender agrees that, upon receipt of a request or identification
of the requirement for disclosure pursuant to clause (iv) hereof, it will make
reasonable efforts to keep the Loan Parties informed of such request or
identification; provided that the each Loan Party acknowledges that each Agent
and each Lender may make disclosure as required or requested by any Governmental
Authority or representative thereof and that each Agent and each Lender may be
subject to review by Securitization Parties or other regulatory agencies and may
be required to provide to, or otherwise make available for review by, the
representatives of such parties or agencies any such non-public information. The
obligations of the Agent and the Lenders under this Section 11.19 shall survive
termination of the Agreement.
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Section 11.20 Integration. This Agreement, together with the
other Loan Documents, reflects the entire understanding of the parties with
respect to the transactions contemplated hereby and shall not be contradicted or
qualified by any other agreement, oral or written, before the date hereof.
Section 11.21 No Novation. This Agreement does not extinguish
the obligations for the payment of money outstanding under the Existing Credit
Agreement or discharge or release the obligations under the Existing Credit
Agreement or the lien or priority of any mortgage, pledge, security agreement or
any other security therefor. Nothing herein contained shall be construed as a
substitution or novation of the obligations outstanding under the Existing
Credit Agreement or instruments securing the same, which shall remain in full
force and effect, except as modified hereby or by instruments executed
concurrently herewith. Nothing expressed or implied in this Agreement shall be
construed as a release or other discharge of the Borrower or any Guarantor under
the Existing Credit Agreement from any of its obligations and liabilities as a
"Borrower" or "Guarantor" thereunder. Each of the Borrower and the Guarantors
hereby (i) confirms and agrees that each Loan Document to which it is a party
is, and shall continue to be, in full force and effect and is hereby ratified
and confirmed in all respects except that on and after the Effective Date of
this Agreement all references in any such Loan Document to "the Credit
Agreement," "thereto," "thereof," "thereunder" or words of like import referring
to the Existing Credit Agreement shall mean the Existing Credit Agreement as
amended and restated by this Agreement and (ii) confirms and agrees that to the
extent that any such Loan Document purports to assign or pledge to the
Collateral Agent a security interest in or lien on, any collateral as security
for the obligations of the Borrower or the Guarantors from time to time existing
in respect of the Existing Credit Agreement and the Loan Documents, such pledge,
assignment and/or grant of the security interest or lien is hereby ratified and
confirmed in all respects.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
BORROWER:
PACKAGED ICE, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Financial Officer
COLLATERAL AGENT, ADMINISTRATIVE
AGENT AND LENDER:
ABLECO FINANCE LLC
By: /s/ ▇▇▇▇▇ ▇. GENDA
------------------------------------------------
Name: ▇▇▇▇▇ ▇. Genda
Title: Senior Vice-President
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