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EXHIBIT 10(a)
$700,000,000 REVOLVING CREDIT FACILITY
AMENDED AND RESTATED CREDIT AGREEMENT
by and among
CONSOLIDATED STORES CORPORATION, an Ohio corporation,
as Borrower
and
THE BANKS PARTY HERETO
and
THE BANK OF NEW YORK, as Syndication Agent and
Managing Agent
and
NATIONAL CITY BANK, as Administrative Agent and
Managing Agent
and
PNC BANK, NATIONAL ASSOCIATION, as Arranger,
Documentation Agent and Managing Agent
and
BANK ONE, N.A., as Co-Syndication Agent and Managing Agent
and
NATIONSBANK, N.A., as Managing Agent
FLEET NATIONAL BANK, as Managing Agent
FIRST UNION NATIONAL BANK, as Managing Agent
and
BANK OF AMERICA NT & SA, as Managing Agent
Dated as of May 15, 1998
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TABLE OF CONTENTS
Page
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1. CERTAIN DEFINITIONS .................................................................... 1
1.1 Certain Definitions. ............................................................ 1
1.2 Construction. ................................................................... 16
1.3 Accounting Principles. .......................................................... 18
2. REVOLVING CREDIT FACILITY .............................................................. 18
2.1 Revolving Credit Commitments. ................................................... 18
2.2 Nature of Banks' Obligations With Respect to Revolving Credit Loans. ............ 18
2.3 Facility Fees. .................................................................. 19
2.5 Revolving Credit Loan Requests. ................................................. 20
2.6 Making Revolving Credit Loans. .................................................. 20
2.7 Revolving Credit Notes. ......................................................... 21
2.8 Use of Proceeds. ................................................................ 21
2.9 Letters of Credit Subfacility. .................................................. 21
2.10 Swing Loans. ................................................................... 26
2.11 Bid Loan Facility. ............................................................. 27
3. INTEREST RATES ......................................................................... 30
3.2 Interest Periods. ............................................................... 30
3.3 Interest After Default. ......................................................... 31
3.4 Euro-Rate Unascertainable. ...................................................... 32
3.5 Selection of Interest Rate Options. ............................................. 33
4. PAYMENTS ............................................................................... 33
4.1 Payments. ....................................................................... 33
4.2 Pro Rata Treatment of Revolving Credit Banks. ................................... 34
4.3 Interest Payment Dates. ......................................................... 34
4.4 Voluntary Prepayments. .......................................................... 34
4.5 Additional Compensation in Certain Circumstances. ............................... 35
5. REPRESENTATIONS AND WARRANTIES ......................................................... 36
5.1 Representations and Warranties. ................................................. 36
5.2 Subsidiaries Other Than Material Subsidiaries. .................................. 44
5.3 Updates to Schedules. ........................................................... 44
6. CONDITIONS OF LENDING .................................................................. 44
6.2 Each Additional Loan. ........................................................... 48
7. COVENANTS .............................................................................. 48
7.1 Affirmative Covenants. .......................................................... 48
7.2.1 Indebtedness. ................................................................. 50
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TABLE OF CONTENTS
Page
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7.3 Reporting Requirements. ......................................................... 57
8. DEFAULT ............................................................................. 61
8.1 Events of Default. .............................................................. 61
8.2 Consequences of Event of Default. ............................................... 64
8.3 Notice of Sale. ................................................................. 66
9. THE MANAGING AGENTS ................................................................. 66
9.1 Appointment. .................................................................... 66
9.2 Delegation of Duties. ........................................................... 67
9.3 Nature of Duties; Independent Credit Investigation. ............................. 67
9.4 Actions in Discretion of Documentation Agent and Administrative Agent;
Instructions From the Banks................... ............................... 67
9.5 Reimbursement and Indemnification of Administrative Agent and Documentation
Agent by the Borrower......................................................... 68
9.6 Exculpatory Provisions. ......................................................... 68
9.7 Reimbursement and Indemnification by Banks of the Documentation Agent,
the Managing Agents, the Syndication Agent and the Administrative Agent....... 69
9.8 Reliance by Documentation Agent, Administrative Agent, Managing Agents
and Syndication Agent. ................. ..................................... 69
9.9 Notice of Default. .............................................................. 70
9.10 Notices. ....................................................................... 70
9.11 Banks in Their Individual Capacities. .......................................... 70
9.12 Holders of Notes. .............................................................. 70
9.13 Equalization of Banks. ......................................................... 70
9.14 Successor Administrative and Documentation Agents. ............................. 71
9.15 Other Fees. .................................................................... 71
9.16 Availability of Funds. ......................................................... 71
9.17 Calculations. .................................................................. 72
9.18 Beneficiaries. ................................................................. 72
9.19 Absence of Duties of Managing Agents and Syndication Agent. .................... 72
10. MISCELLANEOUS ....................................................................... 72
10.1 Modifications, Amendments or Waivers. .......................................... 72
10.2 No Implied Waivers; Cumulative Remedies; Writing Required. ..................... 73
10.3 Reimbursement and Indemnification of Banks by the Borrower; Taxes. ............. 74
10.4 Holidays. ...................................................................... 74
10.5 Funding by Branch, Subsidiary or Affiliate. .................................... 74
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TABLE OF CONTENTS
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10.6 Notices. ....................................................................... 75
10.7 Severability. .................................................................. 75
10.8 Governing Law. ................................................................. 76
10.9 Prior Understanding. ........................................................... 76
10.10 Duration; Survival. .......................................................... 76
10.11 Successors and Assigns. ....................................................... 76
10.12 Confidentiality. .............................................................. 78
10.13 Counterparts. ................................................................. 79
10.14 Documentation Agent's or Bank's Consent. ...................................... 79
10.15 Exceptions. ................................................................... 79
10.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL. ....................................... 79
10.17 Tax Withholding Clause. ....................................................... 80
10.18 Joinder of Guarantors. ........................................................ 80
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LIST OF SCHEDULES AND EXHIBITS
SCHEDULE
SCHEDULE 1.1(A) - PRICING GRID
SCHEDULE 1.1(B) - COMMITMENTS OF BANKS
SCHEDULE 1.1(P) - PERMITTED LIENS
SCHEDULE 5.1.1 - SUBSIDIARIES
SCHEDULE 5.1.3 - SUBSIDIARY MATTERS
SCHEDULE 5.1.13 - CONSENTS AND APPROVALS
SCHEDULE 5.1.18 - MATERIAL CONTRACTS
SCHEDULE 5.1.20 - EMPLOYEE BENEFIT PLAN DISCLOSURES
SCHEDULE 5.1.22 - ENVIRONMENTAL DISCLOSURES
SCHEDULE 7.2.1 - EXISTING INDEBTEDNESS
SCHEDULE 7.2.4 - LOANS AND INVESTMENTS
EXHIBITS
EXHIBIT 1.1(A) - FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
EXHIBIT 1.1(B) - BID NOTE
EXHIBIT 1.1(D) - DESIGNATION AGREEMENT
EXHIBIT 1.1(I)(1) - FORM OF INTERCOMPANY NOTE
EXHIBIT 1.1(R) - FORM OF REVOLVING CREDIT NOTE
EXHIBIT 1.1(S) - FORM OF SWING LOAN NOTE
EXHIBIT 2.5 - FORM OF LOAN REQUEST
EXHIBIT 2.10.2 - FORM OF SWING LOAN REQUEST
EXHIBIT 2.11.1 - BID LOAN REQUEST
EXHIBIT 2.11.2 - FORM OF BID
EXHIBIT 2.11.3(A) - NOTICE OF ACCEPTANCE TO SUCCESSFUL BIDDERS
EXHIBIT 2.11.3(B) - NOTICE OF ACCEPTANCE TO OTHER REVOLVING
CREDIT BANKS
EXHIBIT 6.1.3.3(A) - ACKNOWLEDGMENT RE GUARANTY AGREEMENT AND
INTERCOMPANY SUBORDINATION AGREEMENT
EXHIBIT 6.1.3.3(B) - JOINDER TO GUARANTY AGREEMENT AND
INTERCOMPANY SUBORDINATION AGREEMENT
EXHIBIT 6.1.4 - OPINION OF COUNSEL
EXHIBIT 7.3.3 - FORM OF COMPLIANCE CERTIFICATE
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AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT is dated as of May 15, 1998
and is made by and among CONSOLIDATED STORES CORPORATION, an Ohio corporation
(the "Borrower"), the BANKS (as hereinafter defined), and THE BANK OF NEW YORK,
in its capacity as Syndication Agent and as a Managing Agent, NATIONAL CITY
BANK, in its capacity as Administrative Agent ("Administrative Agent") and as a
Managing Agent, PNC BANK, NATIONAL ASSOCIATION, in its capacity as Arranger, as
Documentation Agent (the "Documentation Agent") and as a Managing Agent, and
BANK ONE, N.A., in its capacity as a Co-Syndication Agent and a Managing Agent
and NationsBank, N.A., Fleet National Bank, Bank of America NT & SA, and First
Union National Bank, as Managing Agents.
WITNESSETH:
WHEREAS, the Borrower had requested a revolving credit facility in an
aggregate principal amount of $700,000,000; and
WHEREAS, the Banks which executed a Credit Agreement dated as of May 3,
1996, as amended (the "Prior Credit Agreement"), provided a revolving credit
facility not to exceed $600,000,000; and
WHEREAS, the Banks are willing to provide a credit facility in an
aggregate principal amount of $700,000,000 upon the terms and conditions
hereinafter set forth;
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:
1. CERTAIN DEFINITIONS
1.1 CERTAIN DEFINITIONS.
In addition to words and terms defined elsewhere in this Agreement, the
following words and terms shall have the following meanings, respectively,
unless the context hereof clearly requires otherwise:
ADMINISTRATIVE AGENT shall mean National City Bank, in its capacity as
Administrative Agent and its successors and assigns.
ADMINISTRATIVE AGENT'S FEE shall have the meaning assigned to that term
in Section 9.15.
AFFILIATE as to any Person shall mean any other Person (i) which
directly or indirectly controls, is controlled by, or is under common control
with such Person, (ii) which beneficially owns or holds 15% or more of any class
of the voting or other equity interests of such Person, or (iii) 15% or more of
any class of voting or other equity interests of which is beneficially owned or
held, directly or indirectly, by such Person. Control, as used in this
definition, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise, including
the power to elect a majority of the directors or trustees of a corporation or
trust, as the case may be.
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AGREEMENT shall mean this Amended and Restated Credit Agreement, as the
same may be supplemented or amended from time to time, including all schedules
and exhibits.
ACKNOWLEDGMENT shall have the meaning assigned to such term in Section
6.1.3.3.
ANNUAL STATEMENTS shall have the meaning assigned to that term in
Section 5.1.9(i).
APPLICABLE DOCUMENTARY ACCEPTED TIME DRAFT LC PERCENTAGE shall have the
meaning assigned to that term in Section
APPLICABLE DOCUMENTARY LC PERCENTAGE shall mean that percentage rate
per annum based on the level of Debt Rating then in effect according to the
pricing grid on SCHEDULE 1.1(A) below the heading "Documentary LC Percentage."
The Applicable Documentary LC Percentage shall be computed in accordance with
the parameters set forth on Schedule 1.1(A).
APPLICABLE FACILITY PERCENTAGE shall mean the percentage rate per annum
based on the level of Debt Rating then in effect according to the pricing grid
on SCHEDULE 1.1(A) below the heading "Facility Fee.". The Applicable Facility
Fee Percentage shall be computed in accordance with the parameters set forth on
Schedule 1.1(A).
APPLICABLE MARGIN shall mean, as applicable:
(A) the percentage spread to be added to Euro-Rate under the Revolving
Credit Euro-Rate Option based on the level of Debt Rating then in effect
according to the pricing grid on SCHEDULE 1.1(A) below the heading "Revolving
Credit Euro-Rate Spread", or
(B) the percentage spread to be added to Base Rate under the Revolving
Credit Base Rate Option which is zero; or
The Applicable Margin shall be computed in accordance with the
parameters set forth on Schedule 1.1(A).
ASSIGNMENT AND ASSUMPTION AGREEMENT shall mean an Assignment and
Assumption Agreement by and among a Purchasing Bank, a Transferor Bank and the
Administrative Agent on behalf of the other Revolving Credit Banks,
substantially in the form of EXHIBIT 1.1(A).
AUTHORIZED OFFICER shall mean those individuals, designated by written
notice to the Administrative Agent from the Borrower, authorized to execute
notices, reports and other documents on behalf of the Loan Parties required
hereunder. The Borrower may amend such list of individuals from time to time by
giving written notice of such amendment to the Administrative Agent.
BANKS shall mean each of the Revolving Credit Banks and each of the
Designated Lenders.
BASE RATE shall mean the greater of (i) the interest rate per annum
announced from time to time by National City Bank at its Principal Office as its
then prime rate, which rate may not be the lowest rate then being charged
commercial borrowers by National City Bank, or (ii) the Federal Funds Effective
Rate plus 1/2% per annum.
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BASE TANGIBLE NET WORTH shall mean the sum of (i) $900,000,000 plus
(ii) 50% of net income of the Company and its Subsidiaries for each fiscal
quarter in which net income was earned (as opposed to a net loss) from and after
January 31, 1998, through the date of determination as determined and
consolidated in accordance with GAAP plus (iii) 50% of the net cash proceeds
from the sale of any capital stock or other equity interest of the Company less
any sums paid or owing by the Company since the date hereof with respect to the
redemption, repurchase or other retirement or cancellation of any of its capital
stock or other equity interests.
BENEFIT ARRANGEMENT shall mean at any time an "employee benefit plan,"
within the meaning of Section 3(3) of ERISA, which is neither a Plan nor a
Multiemployer Plan and which is maintained, sponsored or otherwise contributed
to by any member of the ERISA Group.
BID shall have the meaning assigned to such term in Section 2.11.2.
BID LOAN FIXED RATE OPTION shall mean the option of the Borrower to
request that the Revolving Credit Banks submit Bids to make Bid Loans bearing
interest at a fixed rate per annum quoted by such Revolving Credit Banks as a
numerical percentage (and not as a spread over another rate such as the
Euro-Rate).
BID LOAN INTEREST PERIOD shall have the meaning assigned to such term
in Section 2.11.1.
BID LOAN REQUEST shall have the meaning assigned to such term in
Section 2.11.1.
BID LOANS shall mean collectively and BID LOAN shall mean separately
all of the loans or any loan made by any of the Revolving Credit Banks to the
Borrower pursuant to Section 2.11.
BID NOTES shall mean collectively and BID NOTE shall mean separately
all of the promissory notes or any promissory note of the Borrower in the form
of EXHIBIT 1.1(B) evidencing the Bid Loans together with all amendments,
extensions, renewals, replacements, refinancings or refunds thereof in whole or
in part.
BORROWER shall mean Consolidated Stores Corporation, a corporation
organized and existing under the laws of the State of Ohio.
BORROWING DATE shall mean, with respect to any Loan, the date for the
making thereof or the renewal or conversion thereof at or to the same or a
different Interest Rate Option, which shall be a Business Day.
BORROWING TRANCHE shall mean specified portions of Revolving Credit
Loans or Bid Loans outstanding as follows: (i) any Loans to which a Revolving
Credit Euro-Rate Option or a Bid Loan Fixed Rate Option applies under the
applicable Loan Request by the Borrower and which have the same Interest Period
shall constitute one Borrowing Tranche, and (ii) all Revolving Credit Loans to
which a Revolving Credit Base Rate Option applies shall constitute one Borrowing
Tranche.
BUSINESS DAY shall mean any day other than a Saturday or Sunday or a
legal holiday on which commercial banks are authorized or required to be closed
for business in Columbus, Ohio or New York, New York, and, if the applicable
Business Day relates to any Revolving Credit Loan to which the Revolving Credit
Euro-Rate Option applies, such day must also be a day on which dealings in
Dollar deposits are carried on in the London interbank market.
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CAPITALIZED LEASE shall mean any lease of Property by a Person as
lessee which is a capital lease in accordance with GAAP.
CLOSING DATE shall mean May 15, 1998.
CO-AGENTS shall mean Bank of Tokyo - Mitsubishi Trust Company and
KeyBank National Association.
COMPANY shall mean Consolidated Stores Corporation, a Delaware
corporation, which beneficially owns directly or indirectly all of the capital
stock of the Borrower and its Subsidiaries.
CONSOLIDATED EBIT for any period of determination shall mean an amount
equal to (A) the sum of (i) the net income for such period plus (ii) interest
expense in respect of Indebtedness to the extent deducted in determining net
income for such period ("Interest Expense"), plus (iii) the provision for taxes
for such period based on income or profits to the extent such income or profits
were included in computing net income for such period, minus (B) all
extraordinary income and gains to net income to the extent included in net
income for such period, in each case of the Company and its Subsidiaries for
such period determined on a consolidated basis in accordance with GAAP.
CONSOLIDATED INTEREST EXPENSE for any period of determination shall be
equal to the Interest Expense of the Company and its Subsidiaries as determined
in subclause (ii) of clause (A) of the definition of the term "Consolidated
EBIT" for such period on a consolidated basis in accordance with GAAP.
CONSOLIDATED MATURING RENTALS shall mean the aggregate rental amounts
payable by the Company and its Subsidiaries for the most recent four (4) full
consecutive fiscal quarters immediately preceding the date of determination
under any lease of Property having a remaining term (including any required
renewals or any renewals at the option of the lessor or lessee) of less than one
year (but does not include any amounts payable under Capitalized Leases),
determined in accordance with GAAP.
CONSOLIDATED RENTALS shall mean the aggregate rental amounts payable by
the Company and its Subsidiaries for the most recent four (4) full consecutive
fiscal quarters immediately preceding the date of determination under any lease
of Property having a remaining term (including any required renewals or any
renewals at the option of the lessor or lessee) of one year or more (but does
not include any amounts payable under Capitalized Leases), determined in
accordance with GAAP.
CONSOLIDATED TANGIBLE NET WORTH shall mean as of any date of
determination total stockholders' equity less intangible assets of the Company
and its Subsidiaries as of such date determined and consolidated in accordance
with GAAP.
CO-SYNDICATION AGENT shall mean Bank One, N.A., in its capacity as the
Co-Syndication Agent hereunder.
DEBT RATING shall mean the rating by either Standard & Poor's or
▇▇▇▇▇'▇ of the senior unsecured Indebtedness of the Borrower having an original
maturity of more than one year.
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DESIGNATED LENDER shall mean any Person who has been designated by a
Revolving Credit Bank to fund Bid Loans and has executed a Designation Agreement
and thereby become a party to this Agreement pursuant to Section 10.11.3.1.
DESIGNATING BANK shall have the meaning assigned to such term in
Section 10.11.3.1.
DESIGNATION AGREEMENT means a designation agreement entered into by a
Revolving Credit Bank and a Designated Lender and accepted by the Administrative
Agent, in substantially the form of EXHIBIT 1.1(D).
DOCUMENTARY LETTER OF CREDIT shall have the meaning assigned to that
term in Section 2.9.1.
DOCUMENTARY LETTER OF CREDIT OUTSTANDINGS shall mean at any time the
sum of (i) the aggregate undrawn face amount of outstanding Documentary Letters
of Credit (which excludes Documentary Letter of Credit of (Time Draft)
Outstandings) and (ii) without duplication, the aggregate amount of all unpaid
and outstanding Reimbursement Obligations relating to Documentary Letters of
Credit.
DOCUMENTARY LETTER OF CREDIT (TIME DRAFT) OUTSTANDINGS shall mean at
any time the aggregate face amount of all drafts outstanding under any
Documentary Letters of Credit which the applicable Issuing Letter of Credit Bank
has accepted for payment, but has not yet paid, because such drafts are payable
at a later date that has not yet occurred.
DOCUMENTATION AGENT shall mean PNC Bank, National Association, and its
successors and assigns, in its capacity as Documentation Agent.
DOLLAR, DOLLARS, U.S. DOLLARS and the symbol $ shall mean lawful money
of the United States of America.
ENVIRONMENTAL COMPLAINT shall mean any written complaint setting forth
a cause of action for personal or property damage or natural resource damage or
equitable relief, order, notice of violation, citation, request for information
issued pursuant to any Environmental Laws by an Official Body, subpoena or other
written notice of any type relating to, arising out of, or issued pursuant, to
any of the Environmental Laws or any Environmental Conditions, as the case may
be.
ENVIRONMENTAL CONDITIONS shall mean any conditions of the environment,
including the workplace, the ocean, natural resources (including flora or
fauna), soil, surface water, groundwater, any actual or potential drinking water
supply sources, substrata or the ambient air, relating to or arising out of, or
caused by, the use, handling, storage, treatment, recycling, generation,
transportation, release, spilling, leaking, pumping, emptying, discharging,
injecting, escaping, leaching, disposal, dumping, threatened release or other
management or mismanagement of Regulated Substances resulting from the use of,
or operations on, any Property.
ENVIRONMENTAL LAWS shall mean all federal, state, local and foreign
Laws and regulations, including permits, licenses, authorizations, bonds,
orders, judgments, and consent decrees issued, or entered into, pursuant
thereto, relating to pollution or protection of human health or the environment
or employee safety in the workplace.
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ERISA shall mean the Employee Retirement Income Security Act of 1974,
as the same may be amended or supplemented from time to time, and any successor
statute of similar import, and the rules and regulations thereunder, as from
time to time in effect.
ERISA GROUP shall mean, at any time, the Company and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which, together with
the Borrower, are treated as a single employer under Section 414 of the Internal
Revenue Code.
EURO-RATE shall mean with respect to the Revolving Credit Loans
comprising any Borrowing Tranche to which the Revolving Credit Euro-Rate Option
applies for any Interest Period, the interest rate per annum determined by the
Administrative Agent by dividing (the resulting quotient rounded upward to the
nearest 1/16 of 1% per annum) (i) the rate of interest determined by the
Administrative Agent in accordance with its usual procedures (which
determination shall be conclusive absent manifest error) to be the average of
the London interbank offered rates set forth on the "LIBO" page of the Reuters
Monitor Money Rate Service (or appropriate successor) or, if Reuters or its
successor ceases to provide such quotes, a comparable replacement determined by
the Administrative Agent, at approximately 11:00 a.m. London time two (2)
Business Days prior to the first day of such Interest Period for an amount
comparable to such Borrowing Tranche and having a maturity comparable to such
Interest Period by (ii) a number equal to 1.00 minus the Euro-Rate Reserve
Percentage. The Euro-Rate may also be expressed by the following formula:
Average of London interbank offered rates
on LIBO page of Reuters Monitor Money
Euro-Rate = Rate Service or appropriate successor
-------------------------------------
1.00 - Euro-Rate Reserve Percentage
The Euro-Rate shall be adjusted with respect to any Revolving Credit
Euro-Rate Option outstanding on the effective date of any change in the
Euro-Rate Reserve Percentage as of such effective date. The Administrative Agent
shall give prompt notice to the Borrower of the Euro-Rate as determined or
adjusted in accordance herewith, which determination shall be conclusive absent
manifest error.
EURO-RATE RESERVE PERCENTAGE shall mean the maximum percentage
(expressed as a decimal rounded upward to the nearest 1/100 of 1%) as determined
by the Managing Agents which is in effect during any relevant period, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the reserve requirements (including supplemental,
marginal and emergency reserve requirements) with respect to eurocurrency
funding (currently referred to as "Eurocurrency Liabilities") of a member bank
in such System.
EVENT OF DEFAULT shall mean any of the events described in Section 8.1.
EXECUTIVE OFFICER shall mean as to any designated Person a natural
Person who constitutes an executive officer of such designated Person for
purposes of item 401(b) of Regulation S-K promulgated under the Securities Act
of 1933 and the Securities Exchange Act of 1934.
EXPIRATION DATE shall mean May 15, 2003.
FACILITY FEE shall have the meaning assigned to that term in Section
2.3.
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FEDERAL FUNDS EFFECTIVE RATE for any day shall mean the rate per annum
(based on a year of 360 days and actual days elapsed and rounded upward to the
nearest 1/100 of 1%) announced by the Federal Reserve Bank of New York (or any
successor) on such day as being the weighted average of the rates on overnight
federal funds transactions arranged by federal funds brokers on the previous
trading day, as computed and announced by such Federal Reserve Bank (or any
successor) in substantially the same manner as such Federal Reserve Bank
computes and announces the weighted average it refers to as the "Federal Funds
Effective Rate" as of the date of this Agreement; PROVIDED, if such Federal
Reserve Bank (or its successor) does not announce such rate on any day, the
"Federal Funds Effective Rate" for such day shall be the Federal Funds Effective
Rate for the last day of which such rate was announced.
FINANCIAL PROJECTIONS shall have the meaning assigned to that term in
Section 5.1.9(ii).
FIXED CHARGE COVERAGE RATIO shall mean on any date of determination,
the ratio of (i) the sum of (a) Consolidated EBIT for the most recent four (4)
full consecutive fiscal quarters immediately preceding the date of determination
plus (b) Consolidated Rentals plus (c) Consolidated Maturing Rentals, to (ii)
Fixed Charges.
FIXED CHARGES shall mean for any period of determination the sum of (i)
Consolidated Interest Expense for the most recent four (4) full consecutive
fiscal quarters immediately preceding the date of determination, plus (ii)
Consolidated Rentals plus (iii) Consolidated Maturing Rentals, plus (iv)
dividends paid by the Company and payments by Company for the purchase or
redemption of its capital stock for the four (4) full consecutive fiscal
quarters immediately preceding the date of determination.
FIXED RATE shall mean a fixed interest rate quoted by a Revolving
Credit Bank in its Bid to apply to such Revolving Credit Bank's Bid Loan over
the term of such Bid Loan if such Revolving Credit Bank's Bid is accepted.
GAAP shall mean generally accepted accounting principles as are in
effect from time to time, subject to the provisions of Section 1.3, and applied
on a consistent basis both as to classification of items and amounts.
GOVERNMENTAL ACTS shall have the meaning assigned to that term in
Section 2.9.8.
GUARANTOR shall mean each of the Company and the Subsidiaries of the
Company which is designated as a "Guarantor" on the signature page to the Master
Guaranty Agreement and each other Subsidiary of the Company which joins the
Master Guaranty Agreement and the other Loan Documents as a Guarantor after the
date hereof pursuant to Section 10.18.
GUARANTOR JOINDER shall mean a joinder to the Master Guaranty Agreement
as provided in the Master Guaranty Agreement.
GUARANTY of any Person shall mean any obligation of such Person
guaranteeing or in effect guaranteeing any liability or obligation of any other
Person in any manner, whether directly or indirectly, including any agreement to
indemnify or hold harmless any other Person, any performance bond or other
suretyship arrangement and any other form of assurance against loss, except
endorsement of negotiable or other instruments for deposit or collection in the
ordinary course of business.
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HISTORICAL STATEMENTS shall have the meaning assigned to that term in
Section 5.1.9(i).
INDEBTEDNESS shall mean, as to any Person at any time, any and all
indebtedness, obligations or liabilities (whether matured or unmatured,
liquidated or unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of: (i) borrowed money, (ii)
amounts raised under or liabilities in respect of any note purchase or
acceptance credit facility, (iii) reimbursement obligations (contingent or
otherwise) under any letter of credit, currency swap agreement, interest rate
swap, cap, collar or floor agreement or other interest rate management device,
(iv) any other transaction (including forward sale or purchase agreements,
capitalized leases (but not operating leases) and conditional sales agreements)
having the commercial effect of a borrowing of money entered into by such Person
to finance its operations or capital requirements (but not including trade
payables, trade credits and accrued expenses incurred in the ordinary course of
business which are not represented by a promissory note or other evidence of
indebtedness and which are not more than thirty (30) days past due), or (v) any
Guaranty of Indebtedness for borrowed money. For purposes only of determining
the ratio of total indebtedness to total capitalization in Section 0, the
Subordinated Notes shall be excluded from the term "Indebtedness" used in such
section.
INTERCOMPANY LOANS shall mean loans made by one Loan Party to one or
more other Loan Parties or their Subsidiaries and, in the case of loans between
the Borrower and the Material Subsidiaries, evidenced by intercompany notes (the
"Intercompany Notes") in the form attached hereto as Exhibit 1.1(I)(1).
INTERCOMPANY NOTES shall have the meaning assigned to that term in the
definition of the term "Intercompany Loans".
INTEREST PAYMENT DATE shall mean each date specified for the payment of
interest in Section 4.3.
INTEREST PERIOD shall mean either a Bid Loan Interest Period or a
Revolving Credit Interest Period.
INTEREST RATE OPTION shall mean any Revolving Credit Euro-Rate Option,
the Bid Loan Fixed Rate Option or Revolving Credit Base Rate Option.
INTERNAL REVENUE CODE shall mean the Internal Revenue Code of 1986, as
the same may be amended or supplemented from time to time, and any successor
statute of similar import, and the rules and regulations thereunder, as from
time to time in effect.
ISSUING LETTER OF CREDIT BANK shall mean with respect to a Letter of
Credit a Qualified Letter of Credit Bank which has issued that Letter of Credit
pursuant to Section 2.9."
JOINDER shall have the meaning assigned to such term in Section
6.1.3.3.
LABOR CONTRACTS shall mean all employment agreements, employment
contracts, collective bargaining agreements and other agreements among any Loan
Party or Subsidiary of a Loan Party and its employees.
LAW shall mean any law (including common law), constitution, statute,
treaty, regulation, rule, ordinance, opinion, release, ruling, order,
injunction, writ, decree or award of any Official Body.
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LETTER OF CREDIT shall have the meaning assigned to that term in
Section 2.9.1.
LETTER OF CREDIT OUTSTANDINGS shall mean at any time the sum of (i) the
Documentary Letter of Credit Outstandings, (ii) the Standby Letter of Credit
Outstandings, (iii) the Documentary Letter of Credit (Time Draft) Outstandings
and (iv) without duplication, the aggregate amount of all unpaid and outstanding
Reimbursement Obligations.
LETTERS OF CREDIT FEES shall have the meaning assigned to that term in
Section 2.9.3.
LIEN shall mean any mortgage, deed of trust, pledge, lien, security
interest, charge or other encumbrance or security arrangement of any nature
whatsoever, whether voluntarily or involuntarily given, including any
conditional sale or title retention arrangement, and any assignment, deposit
arrangement or lease intended as, or having the effect of, security and any
filed financing statement or other notice of any of the foregoing (whether or
not a lien or other encumbrance is created or exists at the time of the filing).
LOAN DOCUMENTS shall mean this Agreement, the Master Guaranty
Agreement, the Master Intercompany Subordination Agreement, the Revolving Credit
Notes, the Bid Notes, the Joinder and the Acknowledgment, and any other
instruments, certificates or documents delivered or contemplated to be delivered
hereunder or thereunder or in connection herewith or therewith, as the same may
be supplemented or amended from time to time in accordance herewith or
therewith, and LOAN Document shall mean any of the Loan Documents.
LOAN PARTIES shall mean the Borrower and the Guarantors.
LOAN REQUEST shall mean either a Revolving Credit Loan Request or a Bid
Loan Request.
LOANS shall mean collectively and LOAN shall mean separately all
Revolving Credit Loans, Swing Loans and Bid Loans or any Revolving Credit Loan,
Swing Loan or Bid Loan.
MANAGING AGENTS shall mean all of the financial institutions identified
as a Managing Agent on the first page hereof, each of which is referred to
herein as a "Managing Agent", and their successors and assigns, in their
capacity as Managing Agents.
MASTER GUARANTY AGREEMENT shall mean the Master Guaranty and Suretyship
Agreement, dated as of May 3, 1996, as amended, executed and delivered by the
Company and the other Guarantors to the Administrative Agent for the benefit of
the Revolving Credit Banks.
MASTER INTERCOMPANY SUBORDINATION AGREEMENT shall mean the Master
Intercompany Subordination Agreement, dated as of May 3, 1996, as amended, among
the Loan Parties.
MATERIAL ADVERSE CHANGE shall mean any set of circumstances or events
which (a) has or could reasonably be expected to have any material adverse
effect whatsoever upon the validity or enforceability of this Agreement or any
other Loan Document, (b) is or could reasonably be expected to be material and
adverse to the business, properties, assets, financial condition, results of
operations or prospects of the Loan Parties and their Subsidiaries taken as a
whole, (c) impairs materially or could reasonably be expected to impair
materially the ability of the Loan Parties and their Subsidiaries taken as a
whole to duly and punctually pay or perform their Indebtedness, or (d) impairs
materially or could reasonably be expected to impair materially the ability of
the Documentation Agent or any of the Revolving
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Credit Banks, to the extent permitted, to enforce their legal remedies pursuant
to this Agreement or any other Loan Document.
MATERIAL SUBSIDIARY shall mean any of ▇.▇. ▇▇▇▇ Company, an Ohio
corporation, KB Toy of California, Inc., a Delaware corporation, K.B.
Consolidated, Inc., an Ohio corporation, ▇▇▇-Bee Center, Inc., a California
corporation, and any Subsidiary of the Borrower or the Company having at least
10% of the total consolidated assets of the Company and its Subsidiaries or at
least 10% of the total consolidated revenues of the Company and its Subsidiaries
for the 12-month period ending on the last day of the most recent fiscal quarter
of the Company. Notwithstanding the foregoing, each of KB Toy of Wisconsin,
Inc., TRO, Inc. and ▇▇▇-Bee Toy & Hobby Shops, Inc. (each a "Deemed NM
Subsidiary") shall not be considered to be a Material Subsidiary so long as the
operating assets (as opposed to assets consisting of capital stock) of such
Deemed NM Subsidiary shall not exceed 10% of the total consolidated operating
assets of the Company and its Subsidiaries and the revenues of such Deemed NM
Subsidiary (excluding revenues of Subsidiaries of such Deemed NM Subsidiary
which may be consolidated with the revenues of such Deemed NM Subsidiary under
GAAP) shall not exceed 10% of the total consolidated revenues of the Company and
its Subsidiaries for the 12-month period ending on the last day of the most
recent fiscal quarter of the Company.
MONTH, with respect to an Interest Period under the Revolving Credit
Euro-Rate Option, shall mean the interval between the days in consecutive
calendar months numerically corresponding to the first day of such Interest
Period. If any Euro-Rate Interest Period begins on a day of a calendar month for
which there is no numerically corresponding day in the month in which such
Interest Period is to end, the final month of such Interest Period shall be
deemed to end on the last Business Day of such final month.
MOODY'S shall mean ▇▇▇▇▇'▇ Investors Service, Inc., or any successor
thereto.
MULTIEMPLOYER PLAN shall mean any employee benefit plan which is a
"multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and to
which the Borrower or any member of the ERISA Group is then making or accruing
an obligation to make contributions or, within the preceding five plan years,
has made or had an obligation to make such contributions.
MULTIPLE EMPLOYER PLAN shall mean a Plan which has two or more
contributing sponsors (including the Borrower or any member of the ERISA Group)
at least two of whom are not under common control, as such a plan is described
in Sections 4063 and 4064 of ERISA.
NOTES shall mean the Revolving Credit Notes and the Bid Notes and NOTE
shall mean any Revolving Credit Note or Bid Note.
NOTICES shall have the meaning assigned to that term in Section 10.6.
OBLIGATION shall mean any obligation or liability of any of the Loan
Parties to the Documentation Agent, the Syndication Agents, the Administrative
Agent, the Managing Agents, the Issuing Letter of Credit Banks or any of the
Revolving Credit Banks, howsoever created, arising or evidenced, whether direct
or indirect, absolute or contingent, now or hereafter existing, or due or to
become due, under or in connection with this Agreement, the Notes, the Letters
of Credit or any other Loan Document.
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OFFERED AMOUNT shall have the meaning assigned to such term in Section
2.11.2.
OFFICIAL BODY shall mean any national, federal, state, local or other
government or political subdivision or any agency, authority, bureau, central
bank, commission, department or instrumentality of either, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
PBGC shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor thereto.
PERMITTED INVESTMENTS shall mean:
(i) direct obligations of the United States of America or any agency or
instrumentality thereof or obligations backed by the full faith and credit of
the United States of America maturing in twelve (12) months or less from the
date of acquisition;
(ii) commercial paper maturing in 180 days or less rated not lower than
A-1 by Standard & Poor's or P-1 by Moody's on the date of acquisition; and
(iii) demand deposits, time deposits or certificates of deposit
maturing within one year in commercial banks whose obligations are rated A-1, A
or the equivalent or better by Standard & Poor's on the date of acquisition.
PERMITTED LIENS shall mean:
(i) Liens for taxes, assessments, or similar charges, incurred in the
ordinary course of business and which are not yet due and payable;
(ii) Pledges or deposits made in the ordinary course of business to
secure payment of workmen's compensation, or to participate in any fund in
connection with workmen's compensation, unemployment insurance, old-age pensions
or other social security programs;
(iii) Liens of mechanics, materialmen, warehousemen, carriers, or other
like Liens, securing obligations incurred in the ordinary course of business
that are not yet due and payable and Liens of landlords securing obligations to
pay lease payments that are not yet due and payable or in default;
(iv) Good-faith pledges or deposits made in the ordinary course of
business to secure performance of bids, tenders, contracts (other than for the
repayment of borrowed money) or leases, not in excess of the aggregate amount
due thereunder, or to secure statutory obligations, or surety, appeal,
indemnity, performance or other similar bonds required in the ordinary course of
business;
(v) Encumbrances consisting of zoning restrictions, easements or other
restrictions on the use of real property, none of which materially impairs the
use of such property or the value thereof, and none of which is violated in any
material respect by existing or proposed structures or land use;
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(vi) Liens and security interests in favor of the Administrative
Agent for the benefit of the Revolving Credit Banks or any Issuing Letter of
Credit Bank in the application for a Letter of Credit;
(vii) Liens on property leased by any Loan Party or Subsidiary of a
Loan Party or other interest or title of the lessor under capital and operating
leases securing obligations of such Loan Party or Subsidiary to the lessor under
such leases;
(viii) Any Lien existing on the date of this Agreement and described on
Schedule 1.1(P), provided that the principal amount secured thereby is not
hereafter increased (although it may be refinanced), and no additional assets
become subject to such Lien;
(ix) Purchase Money Security Interests to the extent that (X) such
Purchase Money Security Interests attach to inventory purchased in the ordinary
course of business pursuant to customary payment terms and are not perfected by
the filing of financing statements or other public filings or (Y) the aggregate
amount of loans and deferred payments secured by Purchase Money Security
Interests not described in the foregoing clause (X) do not exceed at any one
time outstanding $10,000,000 (excluding for the purpose of this computation any
loans or deferred payments secured by Liens described on Schedule 1.1(P));
(x) Liens relating to the licensing by Borrower, the other Loan
Parties or their Subsidiaries of intellectual property;
(xi) Liens relating to a sublease entered into by a Loan Party or its
Subsidiary;
(xii) The following, (A) if the validity or amount thereof is being
contested in good faith by appropriate and lawful proceedings diligently
conducted so long as levy and execution thereon have been stayed and continue to
be stayed or (B) if a final judgment is entered and such judgment is discharged
within thirty (30) days of entry or (C) if payments thereof are covered in full
(subject to customary deductibles) by an insurance company of reputable standing
which insurance company has acknowledged that the applicable policy applies to
the following and is not reserving any right to contest applicability, and in
any case they do not in the aggregate, materially impair the ability of any Loan
Party to perform its Obligations hereunder or under the other Loan Documents:
(1) Claims or Liens for taxes, assessments or charges by the
United States, or any department, agency or
instrumentality thereof, or by any state, county,
municipal or other governmental agency, including the
PBGC, due and payable and subject to interest or penalty,
provided that the applicable Loan Party maintains such
reserves or other appropriate provisions as shall be
required by GAAP and pays all such taxes, assessments or
charges forthwith upon the commencement of proceedings to
foreclose any such Lien;
(2) Claims, Liens or encumbrances upon, and defects of title
to, real or personal property, including any attachment of
personal or real property or other legal process prior to
adjudication of a dispute on the merits; and
(3) Claims or Liens of mechanics, materialmen, warehousemen,
carriers, or other statutory nonconsensual Liens; and
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(xiii) additional Liens securing Indebtedness not to exceed
$10,000,000.
PERSON shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, joint
venture, limited liability company, government or political subdivision or
agency thereof, or any other entity.
PLAN shall mean at any time an employee pension benefit plan (including
a Multiple Employer Plan, but not a Multiemployer Plan) which is covered by
Title IV of ERISA or is subject to the minimum funding standards under Section
412 of the Internal Revenue Code and either (i) is maintained by any member of
the ERISA Group for employees of any member of the ERISA Group or (ii) has at
any time within the preceding five years been maintained by any entity which was
at such time a member of the ERISA Group for employees of any entity which was
at such time a member of the ERISA Group.
PNC BANK shall mean PNC Bank, National Association, its successors and
assigns.
POTENTIAL DEFAULT shall mean any event or condition which with notice,
passage of time or a determination by the Managing Agents or the Required Banks,
or any combination of the foregoing, would constitute an Event of Default.
PRINCIPAL OFFICE shall mean the main banking office of the
Administrative Agent in Columbus, Ohio or the main banking office of a Managing
Agent at the address shown on the signature page hereto, as the case may be.
PRIOR CREDIT AGREEMENT shall have the meaning assigned to such term in
the preambles to this Agreement.
PROHIBITED TRANSACTION shall mean any prohibited transaction as defined
in Section 4975 of the Internal Revenue Code or Section 406 of ERISA for which
neither an individual nor a class exemption has been issued by the United States
Department of Labor.
PROPERTY shall mean all real property, both owned and leased, of any
Loan Party or Subsidiary of a Loan Party.
PURCHASE MONEY SECURITY INTEREST shall mean Liens upon real or personal
property securing loans to any Loan Party or Subsidiary of a Loan Party or
deferred payments by such Loan Party or Subsidiary for the purchase of such
property.
PURCHASING BANK shall mean a Revolving Credit Bank which becomes a
party to this Agreement by executing an Assignment and Assumption Agreement.
QUALIFIED LETTER OF CREDIT BANK shall mean any Revolving Credit Bank
designated as such in a written notice by the Borrower to the Administrative
Agent to which the Administrative Agent has not reasonably objected or such
Revolving Credit Bank has not objected to a Revolving Credit Bank's designation
as such within five (5) Business Days of receipt of the Borrower's written
notice of such designation and which designation has not been revoked in a
written notice by the Borrower to the Administrative Agent, provided, however,
that the Borrower may not have more than four (4) Revolving Credit Banks so
designated at any one time.
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RATABLE SHARE shall mean the proportion that a Revolving Credit Bank's
Revolving Credit Commitment bears to the Revolving Credit Commitments of all of
the Revolving Credit Banks.
REGULATED SUBSTANCES shall mean any substance including any solid,
liquid, semisolid, gaseous, thermal, thoriated or radioactive material, refuse,
garbage, wastes, chemicals, petroleum products, by-products and coproducts,
impurities, dust, scrap, and heavy metals defined as a "hazardous substance,"
"pollutant," "pollution," "contaminant," "hazardous or toxic substance,"
"extremely hazardous substance," "toxic chemical," "toxic waste," "hazardous
waste," "industrial waste," "residual waste," "solid waste," "municipal waste,"
"mixed waste," "infectious waste," "chemotherapeutic waste," "medical waste," or
"regulated substance" or any related materials, substances or wastes as now or
hereafter defined pursuant to any Environmental Laws, ordinances, rules,
regulations or other directives of any Official Body, the generation,
manufacture, extraction, processing, distribution, treatment, storage, disposal,
transport, recycling, reclamation, use, reuse, spilling, leaking, dumping,
injection, pumping, leaching, emptying, discharge, escape, release or other
management or mismanagement of which is regulated by the Environmental Laws.
REGULATION U shall mean Regulation U, T, G or X as promulgated by the
Board of Governors of the Federal Reserve System, as amended from time to time.
REIMBURSEMENT OBLIGATION shall have the meaning assigned to such term
in Section 2.9.4.
REPORTABLE EVENT shall mean a reportable event described in Section
4043 of ERISA and regulations thereunder with respect to a Plan or Multiemployer
Plan.
REQUESTED AMOUNT shall have the meaning assigned to such term in
Section 2.11.1.
REQUIRED BANKS shall be defined as follows: (i) prior to the
termination of the Revolving Credit Commitments, "Required Banks" shall mean
Revolving Credit Banks whose Revolving Credit Commitments aggregate at least 66
2/3% of the Revolving Credit Commitments of all of the Revolving Credit Banks,
and (ii) after the earlier of the date on which the Revolving Credit Commitments
are terminated or the date on which Revolving Credit Loans or any other
Indebtedness of the Borrower to the Revolving Credit Banks shall have become due
and payable pursuant to Section 8.2, "Required Banks" shall mean Banks whose
outstanding Loans and Ratable Share (as determined pursuant to Section 2.9.2) in
the face amount of outstanding Letters of Credit and Reimbursement Obligations
aggregate at least 66 2/3% of the total principal amount of the Loans and the
face amount of Letters of Credit and Reimbursement Obligations outstanding
hereunder.
REVOLVING CREDIT BANKS shall mean the financial institutions named on
SCHEDULE 1.1(B) and their respective successors and assigns as permitted
hereunder, each of which is referred to herein as a "Revolving Credit Bank."
REVOLVING CREDIT BASE RATE OPTION shall mean the option of the Borrower
to have Revolving Credit Loans bear interest at the rate and under the terms and
conditions set forth in Section 3.1.1(i).
REVOLVING CREDIT COMMITMENT shall mean, as to any Revolving Credit Bank
at any time the amount initially set forth opposite its name on SCHEDULE 1.1(B)
in the column labeled "Revolving Credit Commitment" and thereafter on Schedule I
to the most recent Assignment and Assumption Agreement, as the same may have
been reduced in accor-
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dance with Section 2.4 and REVOLVING CREDIT COMMITMENTS shall mean the aggregate
Revolving Credit Commitments of all of the Revolving Credit Banks.
REVOLVING CREDIT EURO-RATE OPTION shall mean the option of the Borrower
to have Revolving Credit Loans bear interest at the rate and under the terms and
conditions set forth in Section 3.1.1(ii).
REVOLVING CREDIT INTEREST PERIOD shall have the meaning assigned to
such term in Section 3.2.
REVOLVING CREDIT LOAN REQUEST shall have the meaning assigned to such
term in Section 2.5.
REVOLVING CREDIT LOANS shall mean collectively and REVOLVING CREDIT
LOAN shall mean separately all loans or any loan made by the Revolving Credit
Banks or one of the Revolving Credit Banks to the Borrower pursuant to Section
2.1 or 2.9.4. A Bid Loan is not a Revolving Credit Loan, except that it will be
treated as a Revolving Credit Loan following a termination of the Revolving
Credit Commitments or an acceleration of the Revolving Credit Loans hereunder
pursuant to Section 8.2.1 or 8.2.2 as provided in Section 8.2.3.
REVOLVING CREDIT NOTES shall mean collectively and REVOLVING CREDIT
NOTE shall mean separately all the Revolving Credit Notes of the Borrower in the
form attached hereto as EXHIBIT 1.1(R) evidencing the Revolving Credit Loans
together with all amendments, extensions, renewals, replacements, refinancings
or refundings thereof in whole or in part.
REVOLVING FACILITY USAGE shall mean at any time the sum of the
Revolving Credit Loans outstanding, the Bid Loans outstanding, the Swing Loans
outstanding and the Letter of Credit Outstandings.
ROLLOVER LCS shall mean all letters of credit which were issued by the
Issuing Letter of Credit Banks under the Prior Credit Agreement prior to the
date hereof upon the application of the Borrower or one of its Subsidiaries and
are outstanding on the Closing Date.
SETTLEMENT DATE shall have the meaning assigned thereto in Section
2.10.5.
SHARES shall have the meaning assigned to that term in Section 5.1.2.
STANDARD & POOR'S shall mean Standard & Poor's Ratings Services, a
division of The McGraw Hill Companies, or any successor thereto.
STANDBY LETTER OF CREDIT shall have the meaning assigned to that term
in Section 2.9.1.
STANDBY LETTER OF CREDIT OUTSTANDINGS shall mean at any time the sum of
(i) the aggregate undrawn face amount of outstanding Standby Letters of Credit
and (ii) without duplication, the aggregate amount of all unpaid and outstanding
Reimbursement Obligations relating to Standby Letters of Credit.
SUBORDINATED NOTE AGREEMENT shall mean that certain Note Agreement
dated as of May 9, 1997, between the Borrower and the purchasers thereof for the
purchase of $100,000,000 principal amount of 7% Senior Subordinated Notes due
May 4, 2000 as hereafter amended, replaced or restated.
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SUBORDINATED NOTES shall mean the Notes issued by the Borrower on May
16, 1997 pursuant to the Subordinated Note Agreement as hereafter amended,
replaced or restated, including replacement Subordinated Notes issued thereafter
to transferees of holders thereof.
SUBSIDIARY of any Person at any time shall mean (i) any corporation or
trust of which 50% or more (by number of shares or number of votes) of the
outstanding capital stock or shares of beneficial interest normally entitled to
vote for the election of one or more directors or trustees (regardless of any
contingency which does or may suspend or dilute the voting rights) is at such
time owned directly or indirectly by such Person or one or more of such Person's
Subsidiaries, or any partnership of which such Person is a general partner or of
which 50% or more of the partnership interests is at the time directly or
indirectly owned by such Person or one or more of such Person's Subsidiaries, or
(ii) any corporation, trust, partnership or other entity which is controlled or
capable of being controlled by such Person and/or one or more of such Person's
Subsidiaries.
SUBSIDIARY SHARES shall have the meaning assigned to that term in
Section 5.1.3.
SWING LENDER shall mean National City Bank.
SWING LOAN COMMITMENT shall mean the Swing Lender's commitment to make
Swing Loans to the Borrower pursuant to Section 2.10 in an aggregate principal
amount up to but not in excess of $30,000,000.
SWING NOTE shall mean the Swing Note of the Borrower in the form of
EXHIBIT 1.1(S) evidencing the Swing Loans, together with all amendments,
extensions, renewals, replacements, refinancings or refundings thereof in whole
or in part.
SWING LOAN REQUEST shall mean a request for Swing Loans made in
accordance with Section 2.10.2.
SWING LOANS shall mean collectively and SWING LOAN shall mean
separately all Swing Loans or any Swing Loan made by the Swing Lender to the
Borrower pursuant to Section 2.10.
SYNDICATION AGENT shall mean The Bank of New York, in its capacity as
the Syndication Agent hereunder.
TRANSFEROR BANK shall mean the selling Bank pursuant to an Assignment
and Assumption Agreement.
YEAR 2000 PROBLEM shall have the meaning assigned to such term in
Section 5.1.24.
1.2 CONSTRUCTION.
Unless the context of this Agreement otherwise clearly requires, the
following rules of construction shall apply to this Agreement and each of the
other Loan Documents:
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1.2.1 NUMBER; INCLUSION.
References to the plural include the singular, the plural, the part and
the whole; "or" has the inclusive meaning represented by the phrase "and/or,"
and "including" has the meaning represented by the phrase "including without
limitation";
1.2.1 DETERMINATION.
References to "determination" of or by the Administrative Agent or the
Banks shall be deemed to include good-faith estimates by the Administrative
Agent or the Banks (in the case of quantitative determinations) and good-faith
beliefs by the Administrative Agent or the Banks (in the case of qualitative
determinations) and such determination shall be conclusive absent manifest
error;
1.2.3 DOCUMENTATION AGENT'S DISCRETION AND CONSENT.
Whenever the Documentation Agent or the Banks are granted the right
herein to act in its or their sole discretion or to grant or withhold consent
such right shall be exercised in good-faith;
1.2.4 DOCUMENTS TAKEN AS A WHOLE.
The words "hereof," "herein," "hereunder," "hereto" and similar terms
in this Agreement or any other Loan Document refer to this Agreement or such
other Loan Document as a whole and not to any particular provision of this
Agreement or such other Loan Document;
1.2.5 HEADINGS.
The section and other headings contained in this Agreement or such
other Loan Document and the Table of Contents (if any) preceding this Agreement
or such other Loan Document are for reference purposes only and shall not
control or affect the construction of this Agreement or such other Loan Document
or the interpretation thereof in any respect;
1.2.6 IMPLIED REFERENCES TO THIS AGREEMENT.
Article, section, subsection, clause, schedule and exhibit references
are to this Agreement or such other Loan Document, as the case may be, unless
otherwise specified;
1.2.7 PERSONS.
Reference to any Person includes such Person's successors and assigns
but, if applicable, only if such successors and assigns are permitted by this
Agreement or such other Loan Document, as the case may be, and reference to a
Person in a particular capacity excludes such Person in any other capacity;
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1.2.8 MODIFICATIONS TO DOCUMENTS.
Reference to any agreement (including this Agreement and any other Loan
Document together with the schedules and exhibits hereto or thereto), document
or instrument means such agreement, document or instrument as amended, modified,
replaced, substituted for, superseded or restated;
1.2.9 FROM, TO AND THROUGH.
Relative to the determination of any period of time, "from" means "from
and including," "to" means "to but excluding," and "through" means "through and
including"; and
1.2.10 SHALL; WILL.
References to "shall" and "will" are intended to have the same meaning.
1.3 ACCOUNTING PRINCIPLES.
Except as otherwise provided in this Agreement, all computations and
determinations as to accounting or financial matters and all financial
statements to be delivered pursuant to this Agreement shall be made and prepared
in accordance with GAAP (including principles of consolidation where
appropriate), and all accounting or financial terms shall have the meanings
ascribed to such terms by GAAP. In the event that on or after the date hereof, a
material change occurs in GAAP, the Banks and the Borrower will consult in good
faith regarding whether such change in GAAP affects any financial covenants
contained herein that should be adjusted due to such change in GAAP.
2. REVOLVING CREDIT FACILITY
--------------------------
2.1 REVOLVING CREDIT COMMITMENTS.
Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth, each Revolving Credit Bank
severally agrees to make Revolving Credit Loans to the Borrower at any time or
from time to time on or after the date hereof to the Expiration Date in an
aggregate principal amount not to exceed at any one time such Revolving Credit
Bank's Revolving Credit Commitment minus such Revolving Credit Bank's Ratable
Share of the Letter of Credit Outstandings. Within such limits of time and
amount and subject to the other provisions of this Agreement, the Borrower may
borrow, repay and reborrow pursuant to this Section 2.1; provided that in no
event shall the Revolving Facility Usage exceed, at any one time, an amount
equal to the Revolving Credit Commitments less the face amount of commercial
paper issued by the Borrower and its Subsidiaries.
2.2 NATURE OF BANKS' OBLIGATIONS WITH RESPECT TO REVOLVING
CREDIT LOANS.
Each Revolving Credit Bank shall be obligated to participate in each
request for Revolving Credit Loans pursuant to Section 2.5 in accordance with
its Ratable Share. The aggregate of each Revolving Credit Bank's Revolving
Credit Loans outstanding hereunder to the Borrower at any time shall never
exceed its Revolving Credit Commitment minus its Ratable Share of the Letter of
Credit Outstandings. The obligations of each Revolving Credit Bank hereunder are
several. The failure of any Revolving Credit Bank to perform its obligations
hereunder shall not affect the Obligations of the Borrower to any other party
nor shall any other party be liable for the failure of such Revolving Credit
Bank
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to perform its obligations hereunder. The Revolving Credit Banks shall have no
obligation to make Revolving Credit Loans hereunder on or after the Expiration
Date.
2.3 FACILITY FEES.
The Borrower agrees to pay to the Administrative Agent for the account
of each Revolving Credit Bank, as consideration for such Revolving Credit Bank's
Revolving Credit Commitment hereunder, a nonrefundable facility fee (the
"Facility Fee") at the times and in the amounts as follows:
(A) on the Closing Date in an amount equal to the product of the
following: (i) a fraction equal to the number of days remaining in the quarter
ending on May 31, 1998 as of such Closing Date divided by 365, (ii) the
Applicable Facility Percentage as of such Closing Date, and (iii) the amount of
such Bank's Revolving Credit Commitment (regardless of usage) as of such
effective date, and
(B) on the first Business Day of each June, September, December and
March after the Closing Date until the Expiration Date in an amount equal to the
product of the following: (i) 25%, (ii) the Applicable Facility Percentage in
effect on the due date of such payment, and (iii) the amount of such Revolving
Credit Bank's Revolving Credit Commitment (regardless of usage) as of the due
date of such payment; except that the Facility Fee on the last payment date
prior to the Expiration Date shall equal the product of the following: (i) a
fraction equal to the number of days remaining in the quarter in which the
Expiration Date falls through the Expiration Date divided by 365 or 366, as
applicable, (ii) the Applicable Facility Percentage in effect on the due date of
such payment, and (iii) the amount of such Bank's Revolving Credit Commitment
(regardless of usage) as of the due date of such payment.
2.4 REDUCTION OF REVOLVING CREDIT COMMITMENTS.
2.4.1 VOLUNTARY REDUCTION OF REVOLVING CREDIT COMMITMENTS.
The Borrower shall have the right at any time and from time to time
upon not less than three (3) Business Days' prior written notice to the
Revolving Credit Banks to permanently reduce, in whole multiples of $10,000,000,
or terminate the Revolving Credit Commitments without penalty or premium, except
as hereinafter set forth, provided that any such reduction or termination shall
be accompanied by (a) the payment in full of any Facility Fee then accrued on
the amount of such reduction or termination and (b) prepayment of the Notes,
together with the full amount of interest accrued on the principal sum to be
prepaid (and all amounts referred to in Section 4.5) and the Borrower shall
deposit in a non-interest bearing account (provided that with the consent of the
Issuing Letter of Credit Banks and the Administrative Agent, such consent not to
be unreasonably withheld, such account may be an interest bearing account) with
the Administrative Agent, as cash collateral for its Obligations in respect of
the Letters of Credit and related applications and agreements, an amount equal
to the maximum amount currently or at any time thereafter available to be drawn
on all outstanding Letters of Credit, and the Borrower hereby pledges to the
Administrative Agent and the Revolving Credit Banks, and grants to the
Administrative Agent and the Revolving Credit Banks a security interest in, all
such cash as security for such Obligations, to the extent that the Revolving
Facility Usage then exceeds the difference between the Revolving Credit
Commitments as so reduced or terminated and the face amount of the commercial
paper issued by the Borrower and its Subsidiaries. From time to time the
Administrative Agent shall return to the Borrower any excess of the amount held
in such account over the amount by which the Revolving Facility Usage then
ex-
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ceeds the Revolving Credit Commitments. From the effective date of any such
reduction or termination, the obligations of Borrower to pay the Facility Fee
pursuant to Section 2.3 shall correspondingly be reduced or cease.
2.5 REVOLVING CREDIT LOAN REQUESTS.
Except as otherwise provided herein, the Borrower may from time to time
prior to the Expiration Date request the Revolving Credit Banks to make
Revolving Credit Loans, or renew or convert the Interest Rate Option applicable
to existing Revolving Credit Loans pursuant to Section 3.2, by delivering to the
Administrative Agent, not later than 2:00 p.m., Columbus, Ohio time, (i) three
(3) Business Days prior to the proposed Borrowing Date with respect to the
making of Revolving Credit Loans to which the Revolving Credit Euro-Rate Option
applies or the conversion to or the renewal of the Revolving Credit Euro-Rate
Option for any Revolving Credit Loans; and (ii) one (1) Business Day prior to
either the proposed Borrowing Date with respect to the making of a Revolving
Credit Loan to which the Revolving Credit Base Rate Option applies or the last
day of the preceding Interest Period with respect to the conversion to the
Revolving Credit Base Rate Option for any Revolving Credit Loan, of a duly
completed request therefor substantially in the form of EXHIBIT 2.5 or a request
by telephone immediately confirmed in writing by letter, facsimile or telex in
such form (each, a "Revolving Credit Loan Request"), it being understood that
the Administrative Agent may rely on the authority of any individual making such
a telephonic request without the necessity of receipt of such written
confirmation. Each Revolving Credit Loan Request shall be irrevocable and shall
specify (i) the proposed Borrowing Date; (ii) the aggregate amount of the
proposed Revolving Credit Loans comprising each Borrowing Tranche, which shall
be in integral multiples of $1,000,000 and not less than $5,000,000 for each
Borrowing Tranche to which the Revolving Credit Euro-Rate Option applies and not
less than the lesser of $5,000,000 or the maximum amount available for Borrowing
Tranches to which the Revolving Credit Base Rate Option applies; (iii) whether
the Revolving Credit Euro-Rate Option or Revolving Credit Base Rate Option shall
apply to the proposed Revolving Credit Loans comprising the applicable Borrowing
Tranche; and (iv) in the case of a Borrowing Tranche to which the Revolving
Credit Euro-Rate Option applies, an appropriate Interest Period for the proposed
Revolving Credit Loans comprising such Borrowing Tranche.
2.6 MAKING REVOLVING CREDIT LOANS.
The Administrative Agent shall, promptly after receipt by it of a
Revolving Credit Loan Request pursuant to Section 2.5, notify the Revolving
Credit Banks of its receipt of the related Revolving Credit Loan Request
specifying: (i) the proposed Borrowing Date of such Revolving Credit Loans; (ii)
the amount and type of each such Revolving Credit Loan and the applicable
Interest Period (if any); and (iii) the apportionment among the Revolving Credit
Banks of such Revolving Credit Loans as determined by the Administrative Agent
in accordance with Section 2.2. Each Revolving Credit Bank shall remit the
principal amount of each Revolving Credit Loan to the Administrative Agent such
that the Administrative Agent is able to, and the Administrative Agent shall, to
the extent the Revolving Credit Banks have made funds available to it for such
purpose, fund such Revolving Credit Loans to the Borrower in Dollars and
immediately available funds at the Principal Office prior to 2:00 p.m.,
Columbus, Ohio time, on the applicable Borrowing Date, PROVIDED that if the
Administrative Agent assumes pursuant to Section 9.16 that a Revolving Credit
Bank will make available to the Administrative Agent such Revolving Credit
Bank's portion of a Revolving Credit Loan and such Revolving Credit Bank fails
to remit such funds to the Administrative Agent in a timely manner, the
Administrative Agent may elect in its sole discretion to fund with its own funds
the Revolving Credit Loans of such Revolving Credit Bank on such Borrowing Date,
and such Revolving Credit Bank shall be subject to the repayment obligation in
Section 9.16.
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2.7 REVOLVING CREDIT NOTES.
The Obligation of the Borrower to repay the aggregate unpaid principal
amount of the Revolving Credit Loans made to it by each Revolving Credit Bank,
together with interest thereon, shall be evidenced by a Revolving Credit Note
payable to the order of such Revolving Credit Bank in a face amount equal to the
Revolving Credit Commitment of such Revolving Credit Bank.
2.8 USE OF PROCEEDS.
The proceeds from Loans made shall be used for working capital and
similar general corporate purposes and in accordance with Section 7.1.10 [Use of
Proceeds], and to make other payments as permitted herein.
2.9 LETTERS OF CREDIT SUBFACILITY.
2.9.1 ISSUANCE OF LETTERS OF CREDIT.
Borrower or a Material Subsidiary may request the issuance of (or
modification of any issued) commercial letters of credit in connection with the
Borrower's or Subsidiary of the Borrower's purchase of goods and services (each
a "Documentary Letter of Credit") and standby letters of credit for the benefit
of workmen's compensation or liability insurers, state and federal agencies to
assure compliance with applicable Laws and other Persons in support of refund,
warranty or other obligations of the Borrower or a Subsidiary of the Borrower
(each a "Standby Letter of Credit" and together with Documentary Letters of
Credit referred to as "Letters of Credit" in the aggregate or individually as a
"Letter of Credit") on behalf of itself or another Loan Party by delivering by
no later than 10:00 a.m., Columbus, Ohio time, two (2) Business Days in the case
of a Documentary Letter of Credit and three (3) Business Days in case of a
Standby Letter of Credit prior to the requested date of issuance of such Letter
of Credit to the applicable Issuing Letter of Credit Bank with a copy to the
Administrative Agent a written notice specifying the proposed beneficiary, date
of issuance and expiry date for such Letter of Credit or modification to an
existing Letter of Credit and the nature of the transactions to be supported
thereby. Subject to the terms and conditions hereof and to the execution of a
completed application and agreement for letters of credit in such form as the
applicable Issuing Letter of Credit Bank may specify from time to time and in
reliance on the agreements of the Revolving Credit Banks set forth in this
Section 2.9, such Issuing Letter of Credit Bank will issue a Letter of Credit
provided that each Letter of Credit shall (A) have a maximum maturity of 364
days from the date of issuance, (B) in no event expire later than five Business
Days prior to the Expiration Date and provided further that in no event shall
(i) the sum of the Standby Letter of Credit Outstandings exceed $75,000,000, or
(ii) the Revolving Facility Usage exceed, at any one time, the Revolving Credit
Commitments. Each of the Rollover LC shall be deemed to have been issued
hereunder on the Closing Date by the applicable Issuing Letter of Credit Bank as
a Documentary Letter of Credit or Standby Letter of Credit, as the case may be,
and shall be deemed to be a Letter of Credit for all purposes of this Agreement.
In the event of any conflict between the terms of this Agreement and the terms
of any Issuing Letter of Credit Bank's application and agreement for letters of
credit, the terms of this Agreement shall control (provided that terms of any
Issuing Letter of Credit Bank's application and agreement for letters of credit
which are in addition to those contained herein and which do not expressly
conflict with the terms contained herein shall not be deemed to be in conflict
with this Agreement).
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2.9.2 PARTICIPATIONS.
Immediately upon issuance of each Letter of Credit, and without further
action, each Revolving Credit Bank shall be deemed to, and hereby agrees that it
shall, have irrevocably purchased for such Revolving Credit Bank's own account
and risk from the applicable Issuing Letter of Credit Bank an individual
participation interest in such Letter of Credit and drawings thereunder in an
amount equal to such Revolving Credit Bank's Ratable Share of the maximum amount
which is or at any time may become available to be drawn thereunder, and each
Revolving Credit Bank shall be responsible to reimburse such Issuing Letter of
Credit Bank immediately for its Ratable Share of any disbursement under any
Letter of Credit which has not been reimbursed by Borrower in accordance with
Section 2.9.4 by making its Ratable Share of the Revolving Credit Loans referred
to in Section 2.9.4 available to such Issuing Letter of Credit Bank. Upon the
request of any Revolving Credit Bank and no less frequently than once in each
calendar month, the Administrative Agent shall notify each Revolving Credit Bank
of the amount of such Revolving Credit Bank's participation in Letters of
Credit.
2.9.3 LETTER OF CREDIT FEES.
The Borrower shall pay to the Administrative Agent for the ratable
account of the Revolving Credit Banks (a) fees ("Documentary Letters of Credit
Fees") with respect to Documentary Letters of Credit and (b) fees ("Standby
Letters of Credit Fees") with respect to Standby Letters of Credit, in each case
in the amounts set forth in Sections 2.9.3.1 and 2.9.3.2 (as the same may be
increased as provided in Section 3.3). All Documentary Letters of Credit Fees
and Standby Letters of Credit Fees (collectively, "Letters of Credit Fees")
shall be payable quarterly in arrears commencing with the first Business Day of
each March, June, September and December following issuance of each Letter of
Credit and on the earlier of the Expiration Date or the acceleration of the
Revolving Credit Notes.
2.9.3.1 DOCUMENTARY LETTER OF CREDIT FEES.
Documentary Letters of Credit Fees on Documentary Letters of Credit
shall be determined by multiplying the then Applicable Documentary LC Percentage
times the average daily Documentary Letter of Credit Outstandings.
The Company shall also pay Documentary Letters of Credit Fees in
respect of Documentary Letter of Credit (Time Draft) Outstandings determined by
multiplying two (2) times the Applicable Documentary LC Percentage times the
average daily Documentary Letter of Credit (Time Draft) Outstandings.
The Borrower shall also pay to the applicable Issuing Letter of Credit
Bank for its sole account (i) a fronting fee as determined by such Issuing
Letter of Credit Bank and the Borrower and (ii) such Issuing Letter of Credit
Bank's then in effect customary issuance fees and administrative expense payable
with respect to its Documentary Letters of Credit as such Issuing Letter of
Credit Bank may generally charge or incur from time to time in connection with
the issuance, maintenance, modification (if any), assignment or transfer (if
any), negotiation, and administration of commercial letters of credit, payable
at such times as such Issuing Letter of Credit Bank may specify.
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2.9.3.2 STANDBY LETTER OF CREDIT FEES.
Standby Letters of Credit Fees shall be determined by multiplying the
Applicable Margin then applicable to Revolving Credit Loans outstanding under
the Revolving Credit Euro-Rate Option times the average daily Standby Letter of
Credit Outstandings.
The Borrower shall also pay to the applicable Issuing Letter of Credit
Bank for its sole account (i) a fronting fee as determined by such Issuing
Letter of Credit Bank and the Borrower and (ii) such Issuing Letter of Credit
Bank's then in effect customary issuance fees and administrative expense payable
with respect to its Standby Letters of Credit as such Issuing Letter of Credit
Bank may generally charge or incur from time to time in connection with the
issuance, maintenance, modification (if any), assignment or transfer (if any),
negotiation, and administration of standby letters of credit payable at such
times as such Issuing Letter of Credit Bank may specify.
2.9.4 DISBURSEMENTS, REIMBURSEMENT.
Borrower shall be obligated immediately to reimburse the applicable
Issuing Letter of Credit Bank (each a "Reimbursement Obligation") for all
amounts which such Issuing Letter of Credit Bank is required to pay pursuant to
the Letters of Credit issued by such Issuing Letter of Credit Bank on or before
the date on which the applicable Issuing Letter of Credit Bank is required to
make payment with respect to a draft presented thereunder; provided, however,
that a Reimbursement Obligation with respect to a Documentary Letter of Credit
time draft which has been accepted for payment by an Issuing Letter of Credit
Bank shall not arise until the date on which the applicable Issuing Letter of
Credit Bank is obligated to make a payment with respect to such draft which it
has accepted for payment. The applicable Issuing Letter of Credit Bank will
promptly notify (A) the Borrower of each demand or presentment for payment or
draft accepted for payment or other drawing under each Letter of Credit issued
by such Issuing Letter of Credit Bank, and (B) the Administrative Agent of the
amount required to be paid by such Issuing Letter of Credit Bank pursuant to
each such Letter of Credit. The Administrative Agent shall promptly notify each
Revolving Credit Bank of the amount required to be paid by such Revolving Credit
Bank as a result of a drawing upon such Letter of Credit if the applicable
Issuing Letter of Credit Bank shall have notified the Administrative Agent that
the Borrower has not timely reimbursed such Issuing Letter of Credit Bank for
such draw. If such notice is received by a Revolving Credit Bank before 1:00
p.m., Columbus, Ohio time, such Revolving Credit Bank shall deliver such
Revolving Credit Bank's Ratable Share of such payment in immediately available
funds to the Administrative Agent on that Business Day. If such notice is
received by a Revolving Credit Bank after 1:00 p.m., Columbus, Ohio time, such
Revolving Credit Bank shall before 10:00 a.m., Columbus, Ohio time, on the next
succeeding Business Day deliver to the Administrative Agent such Revolving
Credit Bank's Ratable Share of such payment as a Revolving Credit Loan from such
Revolving Credit Bank in immediately available funds. Upon receipt of each
Revolving Credit Bank's Ratable Share of such payment, the Administrative Agent
shall immediately deliver such Revolving Credit Bank's Ratable Share of such
payment to the applicable Issuing Letter of Credit Bank.
2.9.5 DOCUMENTATION.
Each Loan Party agrees to be bound by the terms of each Issuing Letter
of Credit Bank's application and agreement for letters of credit and each
Issuing Letter of Credit Bank`s written regulations and customary practices
relating to letters of credit, though such interpretation may be different from
such Loan Party's own. In the event of a conflict between such application or
agreement and this Agreement, this Agreement shall govern (provided that terms
of any Issuing Letter of Credit Bank's application and agreement for letters of
credit which are in addition to those con-
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tained herein and which do not expressly conflict with the terms contained
herein shall be deemed not to be in conflict with this Agreement). It is
understood and agreed that, except in the case of gross negligence or willful
misconduct, the applicable Issuing Letter of Credit Bank shall not be liable for
any error, negligence and/or mistakes, whether of omission or commission, in
following any Loan Party's instructions or those contained in the Letters of
Credit issued by such Issuing Letter of Credit Bank or any modifications,
amendments or supplements thereto.
2.9.6 DETERMINATIONS TO HONOR DRAWING REQUESTS.
In determining whether to honor any request for drawing under any
Letter of Credit by the beneficiary thereof, the applicable Issuing Letter of
Credit Bank shall be responsible only to determine that the documents and
certificates required to be delivered under such Letter of Credit have been
delivered and that they appear to comply on their face with the requirements of
such Letter of Credit.
2.9.7 NATURE OF PARTICIPATION AND REIMBURSEMENT OBLIGATIONS.
The obligation of the Revolving Credit Banks to participate in Letters
of Credit pursuant to Section 2.9.2 and the obligation of the Revolving Credit
Banks pursuant to Section 2.9.4 to fund Revolving Credit Loans upon a draw under
a Letter of Credit or to acquire participations in Letters of Credit and the
Obligations of the Borrower to reimburse the applicable Issuing Letter of Credit
Bank upon a draw under any Letter of Credit pursuant to Section 2.9 shall be
absolute unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of such sections under all circumstances, including
the following circumstances:
(i) the failure of any Loan Party or any other Person to
comply with the conditions set forth in Sections 2.1, 2.5,
2.6 or 6.2 or as otherwise set forth in this Agreement for
the making of a Revolving Credit Loan, it being
acknowledged that such conditions are not required for the
making of a Revolving Credit Loan under Section 2.9.4;
(ii) any lack of validity or enforceability of any Letter of
Credit;
(iii) the existence of any claim, set-off, defense or other
right which any Loan Party or any Revolving Credit Bank
may have at any time against a beneficiary or any
transferee of any Letter of Credit (or any Persons for
whom any such transferee may be acting), such Issuing
Letter of Credit Bank or any Revolving Credit Bank or any
other Person or whether in connection with this Agreement,
the transactions contemplated herein or any unrelated
transaction (including any underlying transaction between
any Loan Party or Subsidiaries of a Loan Party and the
beneficiary for which any Letter of Credit was procured);
(iv) any draft, demand, certificate or other document presented
under any 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 even if such Issuing Letter of Credit Bank has
been notified thereof;
(v) payment by such Issuing Letter of Credit Bank under any
Letter of Credit against presentation of a demand, draft
or certificate or other document which does not comply
with the terms of such Letter of Credit;
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(vi) any adverse change in the business, operations,
properties, assets, condition (financial or otherwise) or
prospects of any Loan Party or Subsidiaries of a Loan
Party;
(vii) any breach of this Agreement or any other Loan Document by
any party thereto;
(viii) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing;
(ix) the fact that an Event of Default or a Potential Default
shall have occurred and be continuing; and
(x) the fact that the Expiration Date shall have passed or
this Agreement or the Revolving Credit Commitments
hereunder shall have been terminated.
2.9.8 INDEMNITY.
In addition to amounts payable as provided in Section 9.5, the Borrower
hereby agrees to pay and to protect, indemnify and save harmless each Issuing
Letter of Credit Bank from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable fees,
expenses and disbursements of counsel and allocated costs of internal counsel)
which such Issuing Letter of Credit Bank may incur or be subject to as a
consequence, direct or indirect, of (i) the issuance of any Letter of Credit,
other than as a result of (A) the gross negligence or willful misconduct of such
Issuing Letter of Credit Bank as determined by a final judgment of a court of
competent jurisdiction or (B) subject to the following clause (ii), the wrongful
dishonor by such Issuing Letter of Credit Bank of a proper demand for payment
made under any Letter of Credit or (ii) the failure of such Issuing Letter of
Credit Bank to honor a drawing under any such Letter of Credit as a result of
any act or omission, whether rightful or wrongful, of any present or future de
jure or de facto government or governmental authority (all such acts or
omissions herein called "Governmental Acts").
2.9.9 LIABILITY FOR ACTS AND OMISSIONS.
As between any Loan Party and each Issuing Letter of Credit Bank, such
Loan Party assumes all risks of the acts and omissions of, or misuse of the
Letters of Credit by, the respective beneficiaries of the Letters of Credit. In
furtherance and not in limitation of the foregoing, the applicable Issuing
Letter of Credit Bank shall not be responsible for: (i) the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for an issuance of any Letter of
Credit issued by such Issuing Letter of Credit Bank, even if it should in fact
prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent
or forged (even if such Issuing Letter of Credit Bank shall have been notified
thereof); (ii) the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any such Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part, which
may prove to be invalid or ineffective for any reason; (iii) failure of the
beneficiary of any such Letter of Credit to comply fully with any conditions
required in order to draw upon such Letter of Credit; (iv) errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex or otherwise, whether or not they be in cipher; (v)
errors in interpretation of technical terms; (vi) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of any drawing under such Letter of Credit; or (viii) any consequences arising
from causes beyond the control of
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such Issuing Letter of Credit Bank, including any Governmental Acts, and none of
the above shall affect or impair, or prevent the vesting of, any of such Issuing
Letter of Credit Bank's rights or powers hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth above, any action taken or omitted by any Issuing Letter of
Credit Bank under or in connection with the Letters of Credit issued by it or
any documents and certificates delivered thereunder, if taken or omitted in good
faith, shall not put such Issuing Letter of Credit Bank under any resulting
liability to the Borrower or any Revolving Credit Banks.
The Revolving Credit Banks and any Loan Party may not commence a
proceeding against any Issuing Letter of Credit Bank for wrongful disbursement
under a Letter of Credit issued by such Issuing Letter of Credit Bank as a
result of acts or omissions constituting gross negligence or willful misconduct
of such Issuing Letter of Credit Bank, until the Revolving Credit Banks have
made and the Borrower has repaid the Revolving Credit Loans described in Section
2.9.4; provided, however, that nothing in this Section 2.9 shall adversely
affect the right of any Loan Party, after such payment, to commence any
proceeding against such Issuing Letter of Credit Bank for any breach of its
obligations hereunder.
2.10 SWING LOANS.
2.10.1 SWING LOAN COMMITMENT.
Subject to the terms and conditions hereof and relying upon the
representations and warranties herein set forth, and in order to facilitate
loans and repayments in amounts of $30,000,000 or less, the Swing Lender may, at
its option, cancelable at any time for any reason whatsoever, make swing loans
(the "Swing Loans") to the Borrower at any time or from time to time after the
date hereof to, but not including, the Expiration Date, in an aggregate
principal amount up to the Swing Loan Commitment, subject to reduction as
provided herein and to be made in accordance with the following provisions. The
Swing Lender may in its discretion make Swing Loans provided that the Revolving
Facility Usage shall not at any time exceed an amount equal to the Revolving
Credit Commitments less the face amount of commercial paper issued by the
Borrower and its Subsidiaries. Within such limits of time and amount and subject
to the other provisions of this Agreement, the Borrower may borrow, repay and
reborrow pursuant to this Section 2.10.
2.10.2 SWING LOAN REQUESTS.
Except as otherwise provided herein, the Borrower may from time to time
prior to the Expiration Date request the Swing Lender to make Swing Loans by
delivery to the Swing Lender not later than 12:00 p.m. Columbus, Ohio time on
the proposed Borrowing Date of a duly completed request therefor substantially
in the form of EXHIBIT 2.10.2 hereto or a request by telephone immediately
confirmed in writing by letter, facsimile or telex (each, a "Swing Loan
Request"), it being understood that the Swing Lender may rely on the authority
of any individual making such a telephonic request without the necessity of
receipt of such written confirmation. Each Swing Loan Request shall be
irrevocable and shall specify the proposed Borrowing Date and the principal
amount of such Swing Loan, which shall be not less than $100,000 and in integral
multiples of $100,000.
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2.10.3 MAKING OF SWING LOANS.
So long as the Swing Lender elects to make Swing Loans, the Swing
Lender shall, after receipt by it of a Swing Loan Request pursuant to Section
2.10.2, fund a Swing Loan to the Borrower in U.S. Dollars and immediately
available funds at its Principal Office prior to 2:00 p.m. Columbus, Ohio time
on the related Borrowing Date.
2.10.4 SWING NOTE.
The obligation of the Borrower to repay the unpaid principal amount of
the Swing Loans made to it by the Swing Lender together with interest thereon
shall be evidenced by a demand promissory note of the Borrower in substantially
the form attached hereto as EXHIBIT 1.1(S) payable to the order of the Swing
Lender in a face amount equal to the Swing Loan Commitment.
2.10.5 REPAYMENT OF SWING LOANS WITH REVOLVING CREDIT LOANS
BORROWINGS.
The Swing Lender may at its option, exercisable at any time for any
reason whatsoever, and shall no later than the fifth (5th) Business Day
following the making of a Swing Loan if the outstanding Swing Loans exceed
$15,000,000 on such date (a "Settlement Date"), demand repayment of all Swing
Loans (or at the Swing Lender's option, such portion of the outstanding Swing
Loans which results in the aggregate of such Swing Loans not exceeding
$15,000,000), and each Revolving Credit Bank shall make a Revolving Credit Loan
in an amount equal to such Revolving Credit Bank's Ratable Share of the
aggregate principal amount of the outstanding Swing Loans for which repayment is
demanded, plus, if the Swing Lender so requests, accrued interest thereon,
provided that no Revolving Credit Bank shall be obligated in any event to make
Revolving Credit Loans in excess of its Revolving Credit Commitment less its
Ratable Share of Letter of Credit Outstandings. In that event, such Revolving
Credit Loans shall bear interest at the Base Rate and shall be deemed to have
been properly requested in accordance with Section 2.5 without regard to any of
the requirements of that provision. The Swing Lender shall provide notice to the
Administrative Agent (which may be a telephonic or written notice by letter,
facsimile or telex) that such Revolving Credit Loans are to be made under this
Section 2.10.5; the Administrative Agent shall then provide notice to the
Revolving Credit Banks (which may be a telephonic or written notice by letter,
facsimile or telex) that such Revolving Credit Loans are to be made under this
Section 2.10.5 and of the apportionment among the Revolving Credit Banks, the
Revolving Credit Banks shall be unconditionally obligated to fund such Revolving
Credit Loans (whether or not the conditions specified in Section 6.2 are then
satisfied, including, without limitation, the existence or continuance of any
Event of Default) by the time the Administrative Agent so requests, which shall
not be earlier than 2:00 p.m. Columbus, Ohio time, on the Business Day next
succeeding the date the Revolving Credit Banks receive such notice from the
Administrative Agent; and the Administrative Agent shall promptly deliver the
funds it receives from the Revolving Credit Banks to the Swing Lender.
2.11 BID LOAN FACILITY.
2.11.1 BID LOAN REQUESTS.
Except as otherwise provided herein, the Borrower may from time to time
prior to the Expiration Date request that the Revolving Credit Banks make Bid
Loans by delivery to the Administrative Agent not later than 2:00 P.M., Columbus
time of a duly completed request therefor substantially in the form of EXHIBIT
2.11.1 or a request by telephone immediately confirmed in writing by letter,
facsimile or telex (each, a "Bid Loan Request") at least three (3) Business
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Days prior to the proposed Borrowing Date. The Administrative Agent may rely on
the authority of any individual making a telephonic request referred to in the
preceding sentence without the necessity of receipt of written confirmation.
Each Bid Loan Request shall be irrevocable and shall specify (i) the proposed
Borrowing Date, (ii) the term of the proposed Bid Loan (the "Bid Loan Interest
Period") which may be no less than seven (7) days and no longer than thirty (30)
days, and (iii) the maximum principal amount (the "Requested Amount") of such
Bid Loan, which shall be not less than $5,000,000 and shall be an integral
multiple of $1,000,000. After giving effect to such Bid Loan and any other Loan
made on or before the Borrowing Date, the Revolving Facility Usage shall not
exceed an amount equal to the Revolving Credit Commitments [less the face amount
of commercial paper issued by the Borrower and its Subsidiaries .
2.11.2 BIDDING.
The Administrative Agent shall promptly after receipt by it of a Bid
Loan Request pursuant to Section 2.11.1 notify the Revolving Credit Banks of its
receipt of such Bid Loan Request specifying (i) the proposed Borrowing Date,
(ii) the Bid Loan Interest Period and (iii) the principal amount of the proposed
Bid Loan. Each Revolving Credit Bank may submit a bid (a "Bid") in the form of
EXHIBIT 2.11.2 to the Administrative Agent not later than 10:00 A.M. Columbus
time one (1) Business Day before the proposed Borrowing Date in writing by
facsimile. Each Bid shall specify: (A) the principal amount of proposed Bid
Loans offered by such Revolving Credit Bank (such Bid Loans may be funded by
such Revolving Credit Bank's Designated Lender as provided in Section 2.11.4,
however, such Revolving Credit Bank shall not be required to specify in its Bid
whether such Bid Loans will be funded by such Designated Lender) (the "Offered
Amount") which (i) may be less than, but shall not exceed, the Requested Amount,
(ii) shall be at least $5,000,000 and shall be an integral multiple of
$1,000,000 and (iii) may exceed such Revolving Credit Bank's Revolving Credit
Commitment, and (B) the Fixed Rate which shall apply to such proposed Bid Loan.
If any Bid omits information required hereunder, the Administrative Agent may in
its sole discretion attempt to notify the Revolving Credit Bank submitting such
Bid. If the Administrative Agent so notifies a Revolving Credit Bank, such
Revolving Credit Bank may resubmit its Bid provided that it does so prior to the
time set forth above in this Section 2.11 by which such Revolving Credit Bank is
required to submit its Bid to the Administrative Agent. The Administrative Agent
shall promptly notify the Borrower of the Bids which it timely received from the
Revolving Credit Banks. If the Administrative Agent in its capacity as a
Revolving Credit Bank shall, in its sole discretion, make a Bid, it shall notify
the Borrower of such Bid before 9:00 A.M., Columbus time, one (1) Business Day
before the proposed Borrowing Date.
2.11.3 ACCEPTING BIDS.
The Borrower shall irrevocably accept or reject Bids by notifying the
Administrative Agent of such acceptance or rejection by telephone (immediately
confirmed in writing by letter, facsimile or telex) not later than 11:00 A.M.,
Columbus time, one (1) Business Day before the proposed Borrowing Date. If the
Borrower elects to accept any Bids, its acceptance must meet the following
conditions: (1) the total amount which the Borrower accepts from all Revolving
Credit Banks must exceed $5,000,000 and be in integral multiples of $1,000,000
and may not exceed the Requested Amount; (2) the Borrower must (subject to
clause (4) below) accept Bids based solely on the Fixed Rates which the
Revolving Credit Banks quoted in their Bids in ascending order of such Fixed
Rates; (3) the Borrower may not borrow Bid Loans from any Revolving Credit Bank
(or such Revolving Credit Bank's Designated Lender) on the Borrowing Date in an
amount exceeding such Revolving Credit Bank's Offered Amount; (4) if two or more
Revolving Credit Banks make Bids at the same Fixed Rate and the Borrower desires
to accept a portion but not all of the Bids at such Fixed Rate, the Borrower
shall accept a portion of each Bid equal to the product of the Offered Amount of
such Bid times the fraction obtained by dividing the total amount of Bids which
Borrower is accepting at such Fixed Rate by the sum of
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the Offered Amounts of the Bids at such Fixed Rate; provided that the Borrower
shall round the Bid Loans allocated to each such Revolving Credit Bank upward or
downward as the Borrower may select to integral multiples of $100,000. The
Administrative Agent shall (i) promptly notify a Revolving Credit Bank that has
made a Bid of the amount of its Bid that was accepted or rejected by the
Borrower by delivering a notice in the form of EXHIBIT 2.11.3(A) and (ii) as
promptly as practical notify all of the Revolving Credit Banks (other than those
described in clause (i) immediately above) of the amount of all Bids which the
Borrower has accepted by delivering a notice in the form of EXHIBIT 2.11.3(B).
2.11.4 FUNDING BID LOANS.
Each Revolving Credit Bank whose Bid or portion thereof is accepted
shall, or at its option shall cause its Designated Lender to, remit the
principal amount of its Bid Loan to the Administrative Agent by 12:00 Noon on
the Borrowing Date. The Administrative Agent shall make such funds available to
the Borrower on or before 1:00 A.M. on the Borrowing Date provided that the
conditions precedent to the making of such Bid Loan set forth in Section 6.2
have been satisfied not later than 10:00 A.M., Columbus time, on the proposed
Borrowing Date. If such conditions precedent have not been satisfied prior to
such time, then (i) the Administrative Agent shall not make such funds available
to the Borrower, (ii) the Bid Loan Request shall be deemed to be canceled and
(iii) the Administrative Agent shall return the amount previously funded to the
Administrative Agent by each applicable Bank no later than the following
Business Day. The Borrower shall immediately notify the Administrative Agent of
any failure to satisfy the conditions precedent to the making of Bid Loans under
Section 6.2. The Administrative Agent may assume that the Borrower has satisfied
such conditions precedent if the Borrower (i) has delivered to the
Administrative Agent the documents required to be delivered under Section 6.2,
(ii) the Borrower has not notified the Administrative Agent that the Loan
Parties have not satisfied any other conditions precedent, and (iii) the
Administrative Agent has no actual notice of such a failure. Any Designated
Lender which funds a Bid Loan shall on and after the time of such funding become
the obligee under such Bid Loan and be entitled to receive payment thereof when
due. A Revolving Credit Bank shall be relieved of its obligation to fund a Bid
Loan upon the funding of such Bid Loan by its Designated Lender and not prior to
such time.
2.11.5 SEVERAL OBLIGATIONS.
The obligations of the Revolving Credit Banks to make Bid Loans after
their Bids have been accepted are several. No Revolving Credit Bank shall be
responsible for the failure of any other Bank to make any Bid Loan which another
Revolving Credit Bank has agreed to make.
2.11.6 BID NOTES.
The obligation of the Borrower to repay the aggregate unpaid principal
amount of the Bid Loans made to it by each Revolving Credit Bank or its
Designated Lender, as the case may be, together with interest thereon, shall be
evidenced by a Bid Note dated as of the Closing Date payable to the order of
such Revolving Credit Bank and a Bid Note dated as of the date of the applicable
Designation Agreement in favor of the Designated Lender named in such
Designation Agreement in a face amount equal to the aggregate Revolving Credit
Commitments of all of the Banks.
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2.11.7 PAYMENTS AND PREPAYMENTS.
The Borrower shall repay each Bid Loan on the last day of the Interest
Period with respect to such Bid Loan. The Borrower may not prepay the Bid Loans.
3. INTEREST RATES
--------------
3.1 INTEREST RATE OPTIONS.
The Borrower shall pay interest in respect of the outstanding unpaid
principal amount of the Revolving Credit Loans as selected by it from the
Revolving Credit Base Rate Option or Revolving Credit Euro-Rate Option set forth
below applicable to the Revolving Credit Loans, it being understood that,
subject to the provisions of this Agreement, the Borrower may select different
Interest Rate Options and different Interest Periods to apply simultaneously to
the Revolving Credit Loans comprising different Borrowing Tranches and may
convert to or renew one or more Interest Rate Options with respect to all or any
portion of the Revolving Credit Loans comprising any Borrowing Tranche, PROVIDED
that there shall not be at any one time outstanding more than eight (8)
Borrowing Tranches in the aggregate among all the Revolving Credit Loans. If at
any time the designated rate applicable to any Revolving Credit Loan made by any
Revolving Credit Bank exceeds such Revolving Credit Bank's highest lawful rate,
the rate of interest on such Revolving Credit Bank's Revolving Credit Loan shall
be limited to such Revolving Credit Bank's highest lawful rate.
3.1.1 REVOLVING CREDIT INTEREST RATE OPTIONS.
The Borrower shall have the right to select from the following Interest
Rate Options applicable to the Revolving Credit Loans:
(i) REVOLVING CREDIT BASE RATE OPTION: A fluctuating rate per
annum (computed on the basis of a year of 365 or 366 days,
as the case may be, and actual days elapsed) equal to the
Base Rate, such interest rate to change automatically from
time to time effective as of the effective date of each
change in the Base Rate;
(ii) REVOLVING CREDIT EURO-RATE OPTION: A rate per annum
(computed on the basis of a year of 360 days and actual
days elapsed) equal to the Euro-Rate plus the Applicable
Margin
Swing Loans shall bear interest in accordance with Section 3.1.1(i)
[Revolving Credit Base Rate Option] except to the extent that the Swing Lender
agrees in writing to a different rate of interest; provided, however, that any
Swing Loans with respect to which the Swing Lender demands payment pursuant to
Section 2.10.5 shall bear interest on and after such demand for payment in
accordance with Section 3.1.1(i) [Revolving Credit Base Rate Option]
notwithstanding any other interest rate agreed to by the Administrative Agent.
3.2 INTEREST PERIODS.
At any time when the Borrower shall select, convert to or renew a
Revolving Credit Euro-Rate Option, the Borrower shall notify the Administrative
Agent thereof at least three (3) Business Days prior to the effective date of
such Revolving Credit Euro-Rate Option by delivering a Loan Request. Such notice
shall specify an interest period (the "Re-
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volving Credit Interest Period") during which such Interest Rate Option shall
apply, such Interest Period to be one, two, three or six Months, PROVIDED, that:
3.2.1 ENDING DATE AND BUSINESS DAY.
Any Interest Period which would otherwise end on a date which is not a
Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in the next calendar month, in which case such Interest
Period shall end on the next preceding Business Day;
3.2.2 AMOUNT OF BORROWING TRANCHE.
Each Borrowing Tranche of a Loan to which the Revolving Credit
Euro-Rate Option applies shall be in integral multiples of $1,000,000 and not
less than $5,000,000;
3.2.3 TERMINATION BEFORE EXPIRATION DATE.
The Borrower shall not select, convert to or renew an Interest Period
for any portion of the Loans that would end after the Expiration Date; and
3.2.4 RENEWALS.
In the case of the renewal of a Revolving Credit Euro-Rate Option at
the end of an Interest Period, the first day of the new Interest Period shall be
the last day of the preceding Interest Period, without duplication in payment of
interest for such day.
3.3 INTEREST AFTER DEFAULT.
To the extent permitted by Law, upon the occurrence of an Event of
Default and until such time such Event of Default shall have been cured or
waived:
3.3.1 LETTERS OF CREDIT FEES, INTEREST RATE.
The Letters of Credit Fees and the rate of interest for each Loan
otherwise applicable pursuant to Section 2.9 or Section 3.1, respectively, shall
be increased by 2.0% per annum;
3.3.2 OTHER OBLIGATIONS.
Each other Obligation hereunder if not paid when due shall bear
interest at a rate per annum equal to the sum of the rate of interest applicable
under the Revolving Credit Base Rate Option plus an additional 2.0% per annum
from the time such Obligation becomes due and payable and until it is paid in
full; and
3.3.3 ACKNOWLEDGMENT.
The Borrower acknowledges that the increased rates referred to in this
Section 3.3 reflect, among other things, the fact that such Loans or other
amounts have become a substantially greater risk given their default status
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and that the Banks are entitled to additional compensation for such risk. All
such interest shall be payable by Borrower upon demand by the Administrative
Agent.
3.4 EURO-RATE UNASCERTAINABLE.
3.4.1 UNASCERTAINABLE.
If on any date on which a Euro-Rate would otherwise be determined, the
Administrative Agent shall have determined that:
(i) adequate and reasonable means do not exist for
ascertaining such Euro-Rate, or
(ii) a contingency has occurred which materially and adversely
affects the London interbank eurodollar market relating to
the Euro-Rate,
then the Administrative Agent shall have the rights specified in
Section 3.4.3.
3.4.2 ILLEGALITY; INCREASED COSTS; DEPOSITS NOT AVAILABLE.
If at any time any Revolving Credit Bank shall have determined that:
(i) the making, maintenance or funding of any Revolving Credit
Loan to which a Revolving Credit Euro-Rate Option applies
has been made impracticable or unlawful by compliance by
such Revolving Credit Bank in good faith with any Law or
any interpretation or application thereof by any Official
Body or with any request or directive of any Official Body
(whether or not having the force of Law), or
(ii) such Revolving Credit Euro-Rate Option will not adequately
and fairly reflect the cost to such Revolving Credit Bank
of the establishment or maintenance of any such Revolving
Credit Loan, or
(iii) after making all reasonable efforts, deposits of the
relevant amount in Dollars for the relevant Interest
Period for a Revolving Credit Loan to which a Revolving
Credit Euro-Rate Option applies, are not available to such
Revolving Credit Bank with respect to such Revolving
Credit Loan in the London interbank market,
then such Revolving Credit Bank shall have the rights specified in
Section 3.4.3.
3.4.3 ADMINISTRATIVE AGENT'S AND REVOLVING CREDIT BANK'S
RIGHTS.
In the case of any event specified in Section 3.4.1, the Administrative
Agent shall promptly so notify the Revolving Credit Banks and the Borrower
thereof, and in the case of a determination specified in Section 3.4.2, such
Revolving Credit Bank shall promptly so notify the Administrative Agent and
endorse a certificate to such notice as to the specific circumstances of such
notice, and the Administrative Agent shall promptly send copies of such notice
and certificate to the other Revolving Credit Banks and the Borrower. Upon such
date as shall be specified in such notice (which shall not be earlier than the
date such notice is given) the obligation of (A) the Revolving Credit Banks, in
the
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case of such notice given by the Administrative Agent in respect of Section
3.4.1, or (B) such Revolving Credit Bank, in the case of such notice given by
such Revolving Credit Bank in respect of Section 3.4.2, to allow the Borrower to
select, convert to or renew a Revolving Credit Euro-Rate Option shall be
suspended until the Administrative Agent shall have later notified the Borrower,
or such Revolving Credit Bank shall have later notified the Administrative
Agent, of the Administrative Agent's or such Revolving Credit Bank's, as the
case may be, determination that the circumstances giving rise to such previous
determination no longer exist. If at any time the Administrative Agent makes a
determination under Section 3.4.1 and the Borrower has previously notified the
Administrative Agent of its selection of, conversion to or renewal of a
Revolving Credit Euro-Rate Option and such Interest Rate Option has not yet gone
into effect, such notification shall be deemed to provide for selection of,
conversion to or renewal of the Revolving Credit Base Rate Option otherwise
available with respect to the affected Revolving Credit Loans. If any Revolving
Credit Bank notifies the Administrative Agent of a determination under Section
3.4.2, the Borrower shall, subject to the Borrower's indemnification Obligations
under Section 4.5.2, as to any Revolving Credit Loan of such Revolving Credit
Bank to which a Revolving Credit Euro-Rate Option applies, on the date specified
in such notice convert such Revolving Credit Loan to the Revolving Credit Base
Rate Option otherwise available with respect to such Revolving Credit Loan.
Absent due notice from the Borrower of conversion, such Revolving Credit Loan
shall automatically be converted to the Revolving Credit Base Rate Option
otherwise available with respect to such Revolving Credit Loan upon such
specified date. Upon any such conversion, the Borrower shall have the right to
prepay Revolving Credit Loans in the amount of such Revolving Credit Loan on the
date of such conversion without providing the notice otherwise required by
Section 4.4.1.
3.5 SELECTION OF INTEREST RATE OPTIONS.
If the Borrower fails to select a new Interest Period to apply to any
Borrowing Tranche to which a Revolving Credit Euro-Rate Option applies at the
expiration of an existing Interest Period applicable to such Borrowing Tranche
in accordance with the provisions of Section 3.2, the Borrower shall be deemed
to have converted such Borrowing Tranche to the Revolving Credit Base Rate
Option commencing upon the last day of such Interest Period.
4. PAYMENTS
--------
4.1 PAYMENTS.
All payments and prepayments to be made in respect of principal,
interest, Facility Fees, Letters of Credit Fees, the Administrative Agent's Fee,
or other amounts due from the Borrower hereunder (other than the fees and
expenses referenced in Section 2.9.3.1 and Section 2.9.3.2 which are to be paid
to the Issuing Letter of Credit Bank as provided in such sections and the fees
and expenses referenced in Section 9.15, each of which shall be paid in
accordance with such sections) shall be payable prior to 11:00 a.m., Columbus,
Ohio time, on the date when due without presentment, demand, protest or notice
of any kind, all of which are hereby expressly waived by the Borrower, and
without set-off, counterclaim or other deduction of any nature, and an action
therefor shall immediately accrue. Payments of principal and interest on Loans
and of Facility Fees and Letters of Credit Fees shall be made to the
Administrative Agent at the Principal Office for the ratable accounts of the
Banks in Dollars and in immediately available funds, and the Administrative
Agent shall promptly distribute such amounts to the Banks in immediately
available funds. The Administrative Agent's and each Bank's statement of
account, ledger or other relevant record shall, in the absence of manifest
error, be conclusive as the statement of the amount of principal of and interest
on the Loans and other amounts owing under this Agreement and shall be deemed an
"account stated."
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4.2 PRO RATA TREATMENT OF REVOLVING CREDIT BANKS.
Each borrowing of a Revolving Credit Loan and each reduction of the
Revolving Credit Commitments shall be allocated to each Revolving Credit Bank
according to its Ratable Share, and each selection of, conversion to or renewal
of any Interest Rate Option and each payment or prepayment by the Borrower with
respect to principal, interest, Facility Fees, Letters of Credit Fees, or other
fees (except for the Administrative Agent's Fee and any Issuing Letter of Credit
Bank's fees) or amounts due from the Borrower hereunder to the Revolving Credit
Banks with respect to the Revolving Credit Loans, shall (except as provided in
Section 3.4.2 [Illegality, Increased Costs; Deposits not Available], [Voluntary
Prepayments] or [Additional Compensation in Certain Circumstances]) be made in
proportion to the applicable Revolving Credit Loans outstanding from each
Revolving Credit Bank and, if no such Revolving Credit Loans are then
outstanding, in proportion to the Ratable Share of each Revolving Credit Bank.
4.3 INTEREST PAYMENT DATES.
Interest on Revolving Credit Loans to which the Revolving Credit Base
Rate Option applies and on Swing Loans shall be due and payable in arrears on
the first Business Day of each March, June, September and December after the
date hereof and on the Expiration Date or upon acceleration of the Revolving
Credit Notes. Interest on Revolving Credit Loans to which the Revolving Credit
Euro-Rate Option applies and on any Bid Loans shall be due and payable on the
last day of each Interest Period for those Loans and, if any Interest Period
applicable to a Revolving Credit Loan is longer than three Months, also on the
last day of every third Month during such Interest Period. Without limitation on
Section 4.4.1 interest on mandatory prepayments of principal under Section 4.5
shall be due on the date such mandatory prepayment is due. Interest on the
principal amount of each Loan or other monetary Obligation shall be due and
payable on demand after such principal amount or other monetary Obligation
becomes due and payable (whether on the stated maturity date, upon acceleration
or otherwise).
4.4 VOLUNTARY PREPAYMENTS.
4.4.1 RIGHT TO PREPAY.
The Borrower shall have the right at its option from time to time to
prepay the Revolving Credit Loans and Swing Loans in whole or part without
premium or penalty (except as provided in Section 4.5):
(i) at any time with respect to any Revolving Credit Loan to
which the Revolving Credit Base Rate Option applies or
with respect to any Swing Loan,
(ii) on the last day of the applicable Interest Period with
respect to Revolving Credit Loans to which a Revolving
Credit Euro-Rate Option applies, and
(iii) on the date specified in a notice by any Revolving Credit
Bank pursuant to Section 3.4.3 [Euro-Rate Unascertainable]
with respect to any Revolving Credit Loan to which a
Revolving Credit Euro-Rate Option applies.
Whenever the Borrower desires to prepay any part of the Revolving
Credit Loans, it shall provide a prepayment notice to the Administrative Agent
not later than noon, Columbus, Ohio time on the Business Day prior to the
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date of prepayment of Revolving Credit Loans setting forth the following
information (provided no notice from Borrower is required pursuant to subsection
(iii) above):
(x) the date, which shall be a Business Day, on
which the proposed prepayment is to be made;
(y) a statement indicating the application of
the prepayment to the Revolving Credit Loans
or Swing Loans; and
(z) the total principal amount of such
prepayment, which shall not be less than
$1,000,000.
All prepayment notices shall be irrevocable. The principal amount of
the Revolving Credit Loans and Swing Loans for which a prepayment notice is
given, together with interest on such principal amount except with respect to
Revolving Credit Loans to which the Revolving Credit Base Rate Option applies,
shall be due and payable on the date specified in such prepayment notice as the
date on which the proposed prepayment is to be made. If the Borrower prepays a
Revolving Credit Loan pursuant to this section or otherwise prepays a Revolving
Credit Loan, but fails to specify the applicable Borrowing Tranche which the
Borrower is prepaying, the prepayment shall be applied first to Revolving Credit
Loans to which the Revolving Credit Base Rate Option applies, then to Revolving
Credit Loans to which the Revolving Credit Euro-Rate Option applies. Any
prepayment hereunder shall be subject to the Borrower's Obligation to indemnify
the Revolving Credit Banks under Section 4.5.2.
4.5 ADDITIONAL COMPENSATION IN CERTAIN CIRCUMSTANCES.
4.5.1 INCREASED COSTS OR REDUCED RETURN RESULTING FROM
TAXES, RESERVES, CAPITAL ADEQUACY REQUIREMENTS, EXPENSES, ETC.
If any Law, guideline or interpretation or any change in any Law,
guideline or interpretation or application thereof by any Official Body charged
with the interpretation or administration thereof or compliance with any request
or directive (whether or not having the force of Law) of any central bank or
other Official Body:
(i) subjects any Bank to any tax or changes the basis of
taxation with respect to this Agreement, the Notes, the Loans or payments by the
Borrower of principal, interest, Facility Fees, or other amounts due from the
Borrower hereunder or under the Notes (except for taxes on the overall net
income of such Bank),
(ii) imposes, modifies or deems applicable any reserve, special
deposit or similar requirement against credits or commitments to extend credit
extended by, or assets (funded or contingent) of, deposits with or for the
account of, or other acquisitions of funds by, any Bank, or
(iii) imposes, modifies or deems applicable any capital adequacy
or similar requirement (A) against assets (funded or contingent) of, or letters
of credit, other credits or commitments to extend credit extended by, any Bank,
or (B) otherwise applicable to the obligations of any Bank under this Agreement,
and the result of any of the foregoing is to increase the cost to, reduce the
income receivable by, or impose any expense (including loss of margin) upon any
Bank with respect to this Agreement, the Notes or the making, maintenance or
funding of any part of the Loans (or, in the case of any capital adequacy or
similar requirement, to have the effect of
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reducing the rate of return on any Bank's capital, taking into consideration
such Bank's customary policies with respect to capital adequacy) by an amount
which such Bank in its sole discretion deems to be material, such Bank shall
from time to time notify the Borrower and the Administrative Agent of the amount
determined in good faith (using any averaging and attribution methods employed
in good faith and shall be binding upon the parties absent manifest error) by
such Bank to be necessary to compensate such Bank for such increase in cost,
reduction of income or additional expense or reduced rates of return. Such
notice shall set forth in reasonable detail the basis for such determination.
Such amount shall be due and payable by the Borrower to such Bank ten (10)
Business Days after such notice is given.
4.5.2 INDEMNITY.
In addition to the compensation required by Section 4.6.1, the Borrower
shall indemnify each Bank against all liabilities, losses or expenses (including
loss of margin, any loss or expense incurred in liquidating or employing
deposits from third parties and any loss or expense incurred in connection with
funds acquired by a Bank to fund or maintain Revolving Credit Loans subject to a
Revolving Credit Euro-Rate Option or Bid Loans ) which such Bank sustains or
incurs as a consequence of any
(i) payment, prepayment, conversion or renewal of any
Revolving Credit Loan to which a Revolving Credit
Euro-Rate Option applies or any Bid Loan on a day other
than the last day of the corresponding Interest Period
(whether or not such payment or prepayment is mandatory,
voluntary or automatic and whether or not such payment or
prepayment is then due),
(ii) attempt by the Borrower to revoke (expressly, by later
inconsistent notices or otherwise) in whole or part any
Loan Requests under Section 2.5 or 2.11 or any notice
relating to prepayments under Section 4.4, or
(iii) default by the Borrower in the performance or observance
of any covenant or condition contained in this Agreement
or any other Loan Document, including any failure of the
Borrower to pay when due (by acceleration or otherwise)
any principal, interest, Facility Fee or any other amount
due hereunder.
If any Bank sustains or incurs any such loss or expense, it shall from
time to time notify the Borrower of the amount determined in good faith by such
Bank (which determination may include such assumptions, allocations of costs and
expenses and averaging or attribution methods as such Bank shall deem reasonable
and shall be binding on the parties absent manifest error) to be necessary to
indemnify such Bank for such loss or expense. Such notice shall set forth in
reasonable detail the basis for such determination. Such amount shall be due and
payable by the Borrower to such Bank ten (10) Business Days after such notice is
given.
5. REPRESENTATIONS AND WARRANTIES
------------------------------
5.1 REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Documentation Agent, the
Administrative Agent, the Syndication Agents, the Managing Agents, the Issuing
Letter of Credit Banks and each of the Banks as follows:
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5.1.1 ORGANIZATION AND QUALIFICATION.
Each Loan Party and each Subsidiary of any Loan Party is a corporation
or partnership, duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization. Each Loan Party and each Subsidiary of
any Loan Party has the lawful power to own or lease its properties and to engage
in the business it presently conducts or proposes to conduct. Each Loan Party
and each Subsidiary of any Loan Party is listed on SCHEDULE 5.1.1 and duly
licensed or qualified and in good standing in each jurisdiction where the
property owned or leased by it or the nature of the business transacted by it or
both makes such licensing or qualification necessary (except where the failure
to be so licensed or qualified would not constitute a Material Adverse Change),
and upon request of the Administrative Agent, the Borrower will promptly furnish
a written list of every jurisdiction where each Subsidiary and Loan Party is so
qualified.
CAPITALIZATION AND OWNERSHIP.
The authorized capital stock of the Company consists of 290 million
authorized shares of voting common stock, 107,378,774 of which were outstanding
as of March 27, 1998 (referred to herein as the "Shares"); 8 million authorized
shares of non-voting common stock, none of which are outstanding; and 2 million
authorized shares of preferred stock, none of which are outstanding. All of the
Shares have been validly issued and are fully paid and nonassessable.
5.1.3 SUBSIDIARY MATTERS.
Other than as set forth on SCHEDULE 5.1.3, each of the Company's
Subsidiaries is directly or indirectly wholly owned by the Company and all of
the issued and outstanding shares of capital stock of each such Subsidiary
(referred to herein as the "Subsidiary Shares") are owned free and clear in each
case of any Lien. All Subsidiary Shares have been validly issued, and all
Subsidiary Shares are fully paid and nonassessable. There are no options,
warrants or other rights outstanding to purchase any Subsidiary Shares except as
indicated on SCHEDULE 5.1.3.
5.1.4 POWER AND AUTHORITY.
Each Loan Party has full power to enter into, execute, deliver and
carry out this Agreement and the other Loan Documents to which it is a party, to
incur the Indebtedness contemplated by the Loan Documents and to perform its
Obligations under the Loan Documents to which it is a party, and all such
actions have been duly authorized by all necessary proceedings on its part.
5.1.5 VALIDITY AND BINDING EFFECT.
This Agreement has been duly and validly executed and delivered by each
Loan Party, and each other Loan Document which any Loan Party is required to
execute and deliver on or after the date hereof will have been duly executed and
delivered by such Loan Party on the required date of delivery of such Loan
Document. This Agreement and each other Loan Document constitutes, or will
constitute, legal, valid and binding obligations of each Loan Party which is or
will be a party thereto on and after its date of delivery thereof, enforceable
against such Loan Party in accordance with its terms, except to the extent that
enforceability of any such Loan Document may be limited by bankruptcy,
insol-
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vency, reorganization, moratorium or other similar laws affecting the
enforceability of creditors' rights generally or limiting the right of specific
performance.
5.1.6 NO CONFLICT.
Neither the execution and delivery of this Agreement or the other Loan
Documents by any Loan Party nor the consummation of the transactions herein or
therein contemplated or compliance with the terms and provisions hereof or
thereof by any of them will conflict with, constitute a default under or result
in any breach of (i) the terms and conditions of the certificate of
incorporation, bylaws or other organizational documents of any Loan Party or
(ii) any Law or any material agreement or instrument or order, writ, judgment,
injunction or decree to which any Loan Party or any of its Subsidiaries is a
party or by which it or any of its Subsidiaries is bound or to which it or any
of its Subsidiaries is subject, or result in the creation or enforcement of any
Lien whatsoever upon any property (now or hereafter acquired) of any Loan Party
or any of its Subsidiaries (other than Liens granted under the Loan Documents).
5.1.7 LITIGATION.
There are no actions, suits, proceedings or investigations pending or,
to the knowledge of any Loan Party, threatened against such Loan Party or any
Subsidiary of any Loan Party at law or equity before any Official Body which
individually or in the aggregate may result in any Material Adverse Change. None
of the Loan Parties or any Subsidiaries of any Loan Party is in violation of any
order, writ, injunction or any decree of any Official Body which may result in
any Material Adverse Change.
5.1.8 TITLE TO PROPERTIES.
Each Loan Party and each Subsidiary of any Loan Party has good and
marketable title to or a valid leasehold interest in all material properties,
assets and other rights which it purports to own or lease or which are reflected
as owned or leased on its books and records, free and clear of all Liens except
Permitted Liens, and subject to the terms and conditions of the applicable
leases. All material leases of property are in full force and effect without the
necessity for any consent which has not previously been obtained upon
consummation of the transactions contemplated hereby.
5.1.9 FINANCIAL STATEMENTS.
(i) HISTORICAL STATEMENTS. The Company has delivered to the
Administrative Agent copies of its audited consolidated
year-end financial statements for and as of the end of the
three fiscal years ended January 31, 1998 (the "Annual
Statements" and the Annual Statements are sometimes
collectively referred to as the "Historical Statements").
The Historical Statements were compiled from the books and
records maintained by the Company's management, are
correct and complete and fairly represent the consolidated
financial condition of the Company and its Subsidiaries as
of their dates and the results of operations for the
fiscal periods then ended and have been prepared in
accordance with GAAP consistently applied;
(ii) FINANCIAL PROJECTIONS. The Company has delivered to the
Administrative Agent financial projections of the Company
and its Subsidiaries for fiscal years 1998 through 2003
and derived from various assumptions of the Company's
management (the "Financial Projections"). The Financial
Projections reflect the reasonable expectations of the
Company's management as of the Closing
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Date in light of the history of the business, present
and foreseeable conditions and intentions of the
Company's management, all based on the assumptions
thereto. The Financial Projections accurately reflect
the liabilities of the Company and its Subsidiaries
incurred pursuant to the Loan Documents upon
consummation of the transactions contemplated hereby as
of the Closing Date; and
(iii) ACCURACY OF FINANCIAL STATEMENTS. Neither the Company nor
any Subsidiary of the Company has as of the date of the
Historical Statements any material liabilities, contingent
or otherwise, or forward or long-term commitments that are
not disclosed in the Historical Statements or in the notes
thereto, and except as disclosed therein there are no
unrealized or anticipated losses from any commitments of
the Company or any Subsidiary of the Company which may
cause a Material Adverse Change. Since January 31, 1998 ,
no Material Adverse Change has occurred.
5.1.10 MARGIN STOCK.
None of the Loan Parties or any Subsidiaries of any Loan Party engages
or intends to engage principally, or as one of its important activities, in the
business of extending credit for the purpose, immediately, incidentally or
ultimately, of purchasing or carrying margin stock (within the meaning of
Regulation U). No part of the proceeds of any Loan or issued Letter of Credit
has been or will be used, immediately, incidentally or ultimately, to purchase
or carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock or to refund Indebtedness originally
incurred for such purpose, or for any purpose which entails a violation of or
which is inconsistent with the provisions of the regulations of the Board of
Governors of the Federal Reserve System. None of the Loan Parties or any
Subsidiary of any Loan Party holds or intends to hold margin stock in such
amounts that more than 25% of the reasonable value of the assets of any Loan
Party or Subsidiary of any Loan Party are or will be represented by margin
stock.
5.1.11 FULL DISCLOSURE.
Neither this Agreement nor any other Loan Document, nor any
certificate, statement, agreement or other documents furnished to the
Documentation Agent, the Administrative Agent, the Syndication Agent, the
Managing Agents, the Issuing Letter of Credit Banks or any Bank in connection
herewith or therewith, contains any untrue statement of a material fact or omits
to state a material fact necessary in order to make the statements contained
herein and therein, in light of the circumstances under which they were made,
not misleading. There is no fact known to any Loan Party which materially
adversely affects the business, property, assets, financial condition, results
of operations or prospects of any Loan Party or Subsidiary of any Loan Party
which has not been set forth in this Agreement or in the certificates,
statements, agreements or other documents furnished in writing to the
Documentation Agent, the Administrative Agent, the Syndication Agent, the
Managing Agents, the Issuing Letter of Credit Banks and the Banks prior to or at
the date hereof in connection with the transactions contemplated hereby.
5.1.12 TAXES.
All federal, state, local and other tax returns required to have been
filed with respect to each Loan Party and each Subsidiary of any Loan Party have
been filed, and payment or adequate provision has been made for the payment of
all taxes, fees, assessments and other governmental charges shown to be owing
pursuant to said returns or to assessments received, except to the extent that
such taxes, fees, assessments and other charges are being con-
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tested in good faith by appropriate proceedings diligently conducted and for
which such reserves or other appropriate provisions, if any, as shall be
required by GAAP shall have been made. There are no agreements or waivers
extending the statutory period of limitations applicable to any federal income
tax return of any Loan Party or Subsidiary of any Loan Party for any period.
5.1.13 CONSENTS AND APPROVALS.
No consent, approval, exemption, order or authorization of, or a
registration or filing with, any Official Body or any other Person is required
by any Law or any agreement in connection with the execution, delivery and
carrying out of this Agreement and the other Loan Documents by any Loan Party,
except as listed on SCHEDULE 5.1.13, all of which shall have been obtained or
made on or prior to the Closing Date except as otherwise indicated on SCHEDULE
5.1.13.
5.1.14 NO EVENT OF DEFAULT; COMPLIANCE WITH INSTRUMENTS.
No event has occurred and is continuing and no condition exists now or
will exist after giving effect to and as a result of the extensions of credit to
be made on the Closing Date under the Loan Documents which constitutes an Event
of Default or Potential Default. None of the Loan Parties or any Subsidiaries of
any Loan Party is in violation of (i) any term of its certificate of
incorporation, bylaws, or other organizational documents or (ii) any material
agreement or instrument to which it is a party or by which it or any of its
properties may be subject or bound where such violation would constitute a
Material Adverse Change.
5.1.15 PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES, ETC.
A Loan Party or a Subsidiary of a Loan Party owns or possesses all the
material patents, trademarks, service marks, trade names, copyrights, licenses,
registrations, franchises, permits and rights necessary to own and operate its
properties and to carry on its business as presently conducted and planned to be
conducted by the Borrower and its Subsidiaries taken as a whole, without known
conflict by, or with the rights of, others.
5.1.16 INSURANCE.
The Borrower has delivered to the Administrative Agent a true and
correct listing of the property and general liability insurance of the Borrower.
No notice has been given or claim made and no grounds exist to cancel or avoid
any of such policies or bonds or to reduce the coverage provided thereby. Such
policies and bonds provide adequate coverage from reputable and financially
sound insurers in amounts sufficient to insure the assets and risks of each Loan
Party and each Subsidiary of any Loan Party in accordance with prudent business
practice in the industry of the Loan Parties and their Subsidiaries.
5.1.17 COMPLIANCE WITH LAWS.
The Loan Parties and their Subsidiaries are in compliance in all
material respects with all applicable Laws (other than Environmental Laws which
are specifically addressed in Section 5.1.22) in all jurisdictions in which any
Loan Party or Subsidiary of any Loan Party is presently or currently anticipates
it will be doing business except where the failure to do so would not constitute
a Material Adverse Change.
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5.1.18 MATERIAL CONTRACTS.
SCHEDULE 5.1.18 lists all material contracts relating to the business
operations of each Loan Party and each Subsidiary of any Loan Party, including
all employee benefit plans and Labor Contracts. All such material contracts are
valid, binding and enforceable upon such Loan Party or Subsidiary and each of
the other parties thereto in accordance with their respective terms, and there
is no default thereunder, to the Loan Parties' knowledge, with respect to
parties other than such Loan Party or Subsidiary. For purposes of this Section
5.1.18 the term "material contracts" shall mean those contracts or other
agreements which the Company would be required to file with the Securities and
Exchange Commission pursuant to item 601(a)(10) of Regulation S-K promulgated
under the Securities Act of 1933 and the Securities Exchange Act of 1934.
5.1.19 INVESTMENT COMPANIES.
None of the Loan Parties or any Subsidiaries of any Loan Party is an
"investment company" registered or required to be registered under the
Investment Company Act of 1940 or under the "control" of an "investment company"
as such terms are defined in the Investment Company Act of 1940 and shall not
become such an "investment company" or under such "control".
5.1.20 PLANS AND BENEFIT ARRANGEMENTS.
Except as set forth on SCHEDULE 5.1.20:
(i) The Company and each other member of the ERISA Group are
in compliance in all material respects with any
applicable provisions of ERISA with respect to all
Benefit Arrangements, Plans and Multiemployer Plans.
There has been no Prohibited Transaction with respect to
any Benefit Arrangement or any Plan or, to the best
knowledge of the Company, with respect to any
Multiemployer Plan or Multiple Employer Plan, which
could result in any material liability of the Company or
any other member of the ERISA Group. The Company and all
other members of the ERISA Group have made when due any
and all payments required to be made under any agreement
relating to a Multiemployer Plan or a Multiple Employer
Plan or any Law pertaining thereto. With respect to each
Plan and Multiemployer Plan, the Company and each other
member of the ERISA Group (i) have fulfilled in all
material respects their obligations under the minimum
funding standards of ERISA, (ii) have not incurred any
liability to the PBGC, and (iii) have not had asserted
against them any penalty for failure to fulfill the
minimum funding requirements of ERISA;
(ii) To the best of each Loan Parties' knowledge, each
Multiemployer Plan and Multiple Employer Plan is able to
pay benefits thereunder when due;
(iii) Neither the Company nor any other member of the ERISA
Group has instituted or intends to institute proceedings
to terminate any Plan;
(iv) No event requiring notice to the PBGC under Section
302(f)(4)(A) of ERISA has occurred or is reasonably
expected to occur with respect to any Plan, and no
amendment with respect to which
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security is required under Section 307 of ERISA has been
made or is reasonably expected to be made to any Plan;
(v) The aggregate accumulated benefit obligations determined
in accordance with GAAP as of the end of the most recent
calendar year for all Plans does not exceed by more than
$8 million the fair market value of all assets of the
Plans;
(vi) Neither the Company nor any other member of the ERISA
Group has incurred or reasonably expects to incur any
material withdrawal liability under ERISA to any
Multiemployer Plan or Multiple Employer Plan. Neither the
Company nor any other member of the ERISA Group has been
notified by any Multiemployer Plan or Multiple Employer
Plan that such Multiemployer Plan or Multiple Employer
Plan has been terminated within the meaning of Title IV of
ERISA and, to the best knowledge of the Company, no
Multiemployer Plan or Multiple Employer Plan is reasonably
expected to be reorganized or terminated, within the
meaning of Title IV of ERISA;
(vii) To the extent that any Benefit Arrangement is insured, the
Company and all other members of the ERISA Group have paid
when due all premiums required to be paid for all periods
through the Closing Date. To the extent that any Benefit
Arrangement is funded other than with insurance, the
Company and all other members of the ERISA Group have made
when due all contributions required to be paid for all
periods through the Closing Date; and
(viii) All Plans, Benefit Arrangements and Multiemployer Plans
have been administered in accordance with their terms and
applicable Law.
5.1.21 EMPLOYMENT MATTERS.
Each of the Loan Parties and each of their Subsidiaries is in
compliance with the Labor Contracts and all applicable federal, state and local
labor and employment Laws including those related to equal employment
opportunity and affirmative action, labor relations, minimum wage, overtime,
child labor, medical insurance continuation, worker adjustment and relocation
notices, immigration controls and worker and unemployment compensation, where
the failure to comply would constitute a Material Adverse Change. There are no
outstanding grievances, arbitration awards or appeals therefrom arising out of
the Labor Contracts or current or threatened strikes, picketing, handbilling or
other work stoppages or slowdowns at facilities of any of the Loan Parties or
any of their Subsidiaries which in any case would constitute a Material Adverse
Change.
5.1.22 ENVIRONMENTAL MATTERS.
Except as disclosed on SCHEDULE 5.1.22:
(i) Except for notices which could reasonably relate to a
Material Adverse Change, none of the Loan Parties or any
Subsidiaries of any Loan Party has received any
Environmental Complaint from any Official Body or private
Person alleging that such Loan Party or Subsidiary or any
prior or subsequent owner of any Property is a potentially
responsible party under the Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C.sec.
9601, ET SEQ., and none of the Loan Parties has any reason
to believe that such an Environmental Complaint might be
received.
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There are no pending or, to any Loan Party's knowledge,
threatened Environmental Complaints relating to any Loan
Party or any Subsidiary of any Loan Party or, to any Loan
Party's knowledge, any prior or subsequent owner of any
Property pertaining to, or arising out of, any
Environmental Conditions which could reasonably result in
a Material Adverse Change,
(ii) Except for Environmental Conditions, violations or
failures which individually and in the aggregate are not
reasonably likely to result in a Material Adverse Change,
there are no circumstances at, on or under any Property
that constitute a breach of or non-compliance with any of
the Environmental Laws, and there are no past or present
Environmental Conditions at, on or under any Property or,
to any Loan Party's knowledge, at, on or under adjacent
property, that prevent compliance with the Environmental
Laws at any Property,
(iii) Neither any Property nor any structures, improvements,
equipment, fixtures, activities or facilities thereon or
thereunder contain or use Regulated Substances, except in
compliance with Environmental Laws, which could reasonably
result in a Material Adverse Change. There are no
processes, facilities, operations, equipment or other
activities at, on or under any Property, or, to any Loan
Party's knowledge, at, on or under adjacent property, that
currently result in the release or threatened release of
Regulated Substances onto any Property, except to the
extent that such releases or threatened releases are not a
breach of or otherwise not a violation of the
Environmental Laws or are not likely to result in a
Material Adverse Change,
(iv) There are no aboveground storage tanks, underground
storage tanks or underground piping associated with such
tanks, used for the management of Regulated Substances at,
on or under any Property that (a) do not have, to the
extent required by Environmental Laws, a full operational
secondary containment system in place, and (b) are not
otherwise in compliance with all Environmental Laws,
except in any case where such would not result in a
Material Adverse Change. There are no abandoned
underground storage tanks or underground piping associated
with such tanks, previously used for the management of
Regulated Substances at, on or under any Property that
have not either been closed in place in accordance with
Environmental Laws or removed in compliance with all
applicable Environmental Laws and no contamination
associated with the use of such tanks exists on any
Property that is not in compliance with Environmental
Laws, except in any case where such would not result in a
Material Adverse Change,
(v) The applicable Loan Party or a Subsidiary of a Loan Party
has all permits, licenses, authorizations, plans and
approvals necessary under the Environmental Laws for the
conduct of the business of the Borrower and its
Subsidiaries taken as a whole, except in any case where
the failure to so have would not result in a Material
Adverse Change. Each Loan Party and each Subsidiary of a
Loan Party has submitted all notices, reports and other
filings required by the Environmental Laws to be submitted
to an Official Body which pertain to past and current
operations on any Property, except in any case where the
failure to so submit would not result in a Material
Adverse Change, and
(vi) Except for violations which individually and in the
aggregate are not likely to result in a Material Adverse
Change, all past and present on-site generation, storage,
processing, treatment, recycling, reclamation, disposal or
other use or management of Regulated Substances at, on, or
under
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any Property and all off-site transportation, storage,
processing, treatment, recycling, reclamation, disposal or
other use or management of Regulated Substances have been
done in accordance with the Environmental Laws.
5.1.23 SENIOR DEBT STATUS.
The Obligations of each Loan Party under this Agreement, the Notes, the
Master Guaranty Agreement and each of the other Loan Documents to which it is a
party do rank and will rank at least PARI PASSU in priority of payment with all
other Indebtedness of such Loan Party except Indebtedness of such Loan Party to
the extent secured by Permitted Liens and will rank senior in priority of
payment to the Subordinated Notes. There is no Lien upon or with respect to any
of the properties or income of any Loan Party or Subsidiary of any Loan Party
which secures indebtedness or other obligations of any Person except for
Permitted Liens.
5.1.24 YEAR 2000.
The Borrower and its Subsidiaries have reviewed the areas within their
business and operations which could be adversely affected by, and have developed
or are developing a program to address on a timely basis, the risk that certain
computer applications used by the Borrower or its Subsidiaries (or any of their
respective material suppliers, customers or vendors but excluding the U.S.
Customs Service and related agencies provided any such failure to comply shall
not result as a Material Adverse Change) may be unable to recognize and perform
properly date-sensitive functions involving dates prior to and after December
31, 1999 (the "Year 2000 Problem"). The Year 2000 Problem will not result in any
Material Adverse Change.
5.2 SUBSIDIARIES OTHER THAN MATERIAL SUBSIDIARIES.
The breach of any of the representations and warranties contained in
Section 5.1 with respect to a Subsidiary of the Borrower other than a Material
Subsidiary shall not be deemed to breach such representation or warranty unless
such breach constitutes a Material Adverse Change.
5.3 UPDATES TO SCHEDULES.
Should any of the information or disclosures provided on any of the
Schedules attached hereto become outdated or incorrect in any material respect,
the applicable Loan Parties shall promptly provide to the Managing Agents in
writing with such revisions or updates to such Schedule as may be necessary or
appropriate to update or correct same; PROVIDED, however, that no Schedule shall
be deemed to have been amended, modified or superseded by any such correction or
update (other than the amendments and updates contained in the Schedules
delivered on the Closing Date), nor shall any breach of warranty or
representation resulting from the inaccuracy or incompleteness of any such
Schedule be deemed to have been cured thereby, unless and until the Required
Banks, in their sole and absolute discretion, shall have accepted in writing
such revisions or updates to such Schedule, which decision to accept or not must
be communicated to the Borrower promptly.
6. CONDITIONS OF LENDING
---------------------
The obligation of each Bank to make Revolving Credit Loans and of the
Issuing Letter of Credit Banks to issue Letters of Credit hereunder is subject
to the performance by each of the Loan Parties of its Obligations to be per-
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formed hereunder at or prior to the making of any such Revolving Credit Loans or
issuance of such Letters of Credit and to the satisfaction of the following
further conditions:
6.1 FIRST REVOLVING CREDIT LOANS.
On the Closing Date:
6.1.1 OFFICER'S CERTIFICATE.
The representations and warranties of each of the Loan Parties
contained in Article and in each of the other Loan Documents shall be true and
accurate on and as of the Closing Date with the same effect as though such
representations and warranties had been made on and as of such date (except
representations and warranties which relate solely to an earlier date or time,
which representations and warranties shall be true and correct on and as of the
specific dates or times referred to therein), and each of the Loan Parties shall
have performed and complied with all covenants and conditions hereof and
thereof, no Event of Default or Potential Default shall have occurred and be
continuing or shall exist; and there shall be delivered to the Administrative
Agent for the benefit of each Bank a certificate of the Borrower, the Company
and each of the Material Subsidiaries, dated the Closing Date and signed by the
Chief Executive Officer, President or Chief Financial Officer of such Person, to
each such effect.
6.1.2 SECRETARY'S CERTIFICATE.
There shall be delivered to the Administrative Agent for the benefit of
each Bank a certificate dated the Closing Date and signed by the Secretary or an
Assistant Secretary of each of the Company, the Borrower and each Material
Subsidiary, certifying as appropriate as to:
(i) all action taken by such Loan Party in connection with
this Agreement and the other Loan Documents which are
effective as of the Closing Date hereof;
(ii) the names of the officer or officers authorized to sign
this Agreement and the other Loan Documents and the true
signatures of such officer or officers and specifying the
Authorized Officers permitted to act on behalf of such
Loan Party for purposes of this Agreement and the true
signatures of such officers, on which the Administrative
Agent and each Bank may conclusively rely; and
(iii) copies of its organizational documents, including its
certificate of incorporation and bylaws as in effect on
the Closing Date (except if there have been no changes to
such organizational documents with respect to any such
Loan Party since the date on which such documents were
delivered in connection with the Prior Credit Agreement,
the secretary of such Loan Party may certify to such
effect in lieu of delivering copies of such organizational
documents) certified by the appropriate state official
where such documents are filed in a state office together
with certificates from the appropriate state officials as
to the continued existence and good standing of the
Borrower in the state where organized.
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6.1.3 DELIVERY OF LOAN DOCUMENTS.
6.1.3.1 THIS AGREEMENT.
This Agreement shall have been executed by all of the parties hereto
and delivered to the Administrative Agent for the benefit of the Banks.
6.1.3.2 REVOLVING CREDIT NOTES AND BID NOTES.
The Borrower shall have executed and delivered to each Revolving Credit
Bank a Revolving Credit Note in the form of Exhibit 1.1(R) of the Credit
Agreement and a Bid Note in the form of EXHIBIT 1.1(B) of this Agreement.
6.1.3.3 ACKNOWLEDGMENT REGARDING MASTER GUARANTY
AGREEMENT AND MASTER INTERCOMPANY SUBORDINATION AGREEMENT AND JOINDER
THERETO.
Each of the parties to the Master Guaranty Agreement and Master
Intercompany Subordination Agreement shall sign an acknowledgment (the
"Acknowledgment") in the form of EXHIBIT 6.1.3.3(A) hereto, provided however,
that the Company must sign and deliver its signature page to such Acknowledgment
on or before May 21, 1998 in accordance with Section 7.2.22 hereof, (1)
acknowledging that the Master Guaranty Agreement and Master Intercompany
Subordination Agreement remain in full force and effect after giving effect to
this Amendment and the transactions contemplated hereby, and (2) including a new
schedule of Guarantors to be attached to such Master Guaranty Agreement and
Master Intercompany Subordination Agreement and an acknowledgment that all such
Guarantors are obligated thereunder. Each Subsidiary of the Company which has
not executed the Master Guaranty Agreement or Master Intercompany Subordination
Agreement shall execute and deliver to the Administrative Agent for the benefit
of the Banks the joinder (the "Joinder") in the form attached as EXHIBIT
6.1.3.3(B) hereto.
6.1.3.4 SCHEDULES.
The Loan Parties shall have delivered the Schedules to this Agreement
(which may be in substantially the same form as those delivered in connection
with the Prior Agreement, but which shall be updated to reflect any changes
thereto).
6.1.4 OPINION OF COUNSEL.
There shall be delivered to the Administrative Agent for the benefit of
each Bank a written opinion of Benesch, Friedlander, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P. and
of ▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq., counsel for the Loan Parties (who may rely on the
opinions of such other counsel as may be acceptable to the Administrative
Agent), dated the Closing Date and in form and substance satisfactory to the
Managing Agents and their counsel as to the matters set forth in EXHIBIT 6.1.4.
6.1.5 LEGAL DETAILS.
All legal details and proceedings in connection with the transactions
contemplated by this Agreement and the other Loan Documents shall be in form and
substance satisfactory to the Administrative Agent, Documentation Agent,
Syndication Agent and Co-Syndication Agent and their counsel, and the
Administrative Agent and Documentation Agent shall have received all such other
counterpart originals or certified or other copies of such documents and
pro-
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ceedings in connection with such transactions, in form and substance
satisfactory to the Administrative Agent and Documentation Agent and said
counsel, as any of the Administrative Agent or Documentation Agent or said
counsel may reasonably request.
6.1.6 PAYMENT OF FEES.
The Borrower shall have paid or caused to be paid to the Administrative
Agent for itself and for the account of the Banks to the extent not previously
paid all Facility Fees, arrangement fees and other fees accrued through the
Closing Date and the costs and expenses for which the Documentation Agent, the
Administrative Agent and the Banks are entitled to be reimbursed.
6.1.7 CONSENTS.
All material consents required to effectuate the transactions
contemplated hereby as set forth on SCHEDULE 5.1.13 shall have been obtained.
6.1.8 OFFICER'S CERTIFICATE REGARDING MACS.
Since January 31, 1998 (i) no Material Adverse Change shall have
occurred and (ii) there shall have been no material change in the management of
the Company or the Borrower (except as disclosed to the Banks in a writing
referencing this provision); and there shall have been delivered to the
Administrative Agent for the benefit of each Bank a certificate dated the
Closing Date and signed by the Chief Executive Officer, President or Chief
Financial Officer of the Borrower and the Company to each such effect.
6.1.9 NO VIOLATION OF LAWS.
The making of the Revolving Credit Loans and issuance of the Letters of
Credit shall not contravene any Law applicable to any Loan Party or any of the
Banks.
6.1.10 NO ACTIONS OR PROCEEDINGS.
No action, proceeding, investigation, regulation or legislation shall
have been instituted, threatened or proposed before any court, governmental
agency or legislative body to enjoin, restrain or prohibit, or to obtain damages
in respect of, this Agreement, the other Loan Documents or the consummation of
the transactions contemplated hereby or thereby or which, in the Administrative
Agent's, the Documentation Agent's, the Syndication Agent's and the
Co-Syndication Agent's sole discretion, would make it inadvisable to consummate
the transactions contemplated by this Agreement or any of the other Loan
Documents.
6.1.11 [INTENTIONALLY OMITTED].
6.1.12 TERMINATION OF PRIOR CREDIT AGREEMENT.
The Borrower shall have terminated the Prior Credit Agreement and paid
all amounts owed thereunder and the parties thereto shall have executed and
delivered a payoff letter in connection with such termination and repayment. It
is acknowledged that the Facility Fee thereunder shall accrue through (and not
beyond) the Closing Date and
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appropriate credits shall be made to the payoff amount under the Prior Credit
Agreement to provide for any prepayment of such Facility Fee relating to periods
after the Closing Date.
6.2 EACH ADDITIONAL LOAN.
At the time of making any Revolving Credit Loans, Bid Loan or Swing
Loans or issuance of any Letters of Credit other than Revolving Credit Loans or
Bid Loans made or Letters of Credit deemed issued on the Closing Date and after
giving effect to the proposed extensions of credit: the representations and
warranties of the Loan Parties contained in Article and in the other Loan
Documents shall be true on and as of the date of such additional Revolving
Credit Loan, Bid Loan or Swing Loan or Letter of Credit with the same effect as
though such representations and warranties had been made on and as of such date
(except representations and warranties which expressly relate solely to an
earlier date or time, which representations and warranties shall be true and
correct on and as of the specific dates or times referred to therein) and the
Loan Parties shall have performed and complied with all covenants and conditions
hereof; no Event of Default or Potential Default shall have occurred and be
continuing or shall exist; the making of the Revolving Credit Loans, Bid Loans
or Swing Loans or issuance of such Letter of Credit shall not contravene any Law
applicable to any Loan Party or Subsidiary of any Loan Party or any of the
Banks; and the Borrower shall have delivered to the Administrative Agent or the
Issuing Letter of Credit Bank, a duly executed and completed Loan Request or
application for a Letter of Credit as the case may be.
7. COVENANTS
---------
7.1 AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that until payment in full of the
Revolving Credit Loans and Reimbursement Obligations and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties' other Obligations under the Loan Documents and termination of the
Revolving Credit Commitments, the Loan Parties shall comply at all times with
the following affirmative covenants:
7.1.1 PRESERVATION OF EXISTENCE, ETC.
The Company, the Borrower and, except as permitted by Section 7.2.6,
each Material Subsidiary shall maintain its corporate existence and its license
or qualification and good standing in each jurisdiction in which its ownership
or lease of property or the nature of its business makes such license or
qualification necessary, except where the failure to be so licensed or qualified
would not result in a Material Adverse Change.
7.1.2 PAYMENT OF LIABILITIES, INCLUDING TAXES, ETC.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
duly pay and discharge all liabilities to which it is subject or which are
asserted against it, promptly as and when the same shall become due and payable,
including all taxes, assessments and governmental charges upon it or any of its
properties, assets, income or profits, prior to the date on which penalties
attach thereto, except to the extent that such liabilities, including taxes,
assessments or charges, are being contested in good faith and by appropriate and
lawful proceedings diligently conducted and for which such reserve or other
appropriate provisions, if any, as shall be required by GAAP shall have been
made, but only to the extent that failure to discharge any such liabilities
would not result in any additional liability which would adversely affect to a
material extent the financial condition of the Loan Parties and their
Subsidiaries taken as a
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whole, PROVIDED that the Loan Parties and their Subsidiaries will pay all such
liabilities forthwith upon the commencement of proceedings to foreclose any Lien
which may have attached as security therefor unless and as long as such
proceedings are stayed.
7.1.3 MAINTENANCE OF INSURANCE.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
insure its properties and assets against loss or damage by fire and such other
insurable hazards as such assets are commonly insured (including fire, extended
coverage, property damage, workers' compensation, public liability and business
interruption insurance) and against other risks (including errors and omissions)
in such amounts as similar properties and assets are insured by prudent
companies in similar circumstances carrying on similar businesses, and with
reputable and financially sound insurers, including self-insurance to the extent
customary, all as reasonably determined by the Documentation Agent. At the
request of the Administrative Agent, the Loan Parties shall deliver to the
Administrative Agent (x) on the Closing Date and annually thereafter an original
certificate of insurance signed by the Loan Parties' independent insurance
broker describing and certifying as to the existence of the insurance required
to be maintained by this Agreement and the other Loan Documents, and (y) from
time to time a summary schedule indicating all insurance then in force with
respect to each of the Loan Parties.
7.1.4 MAINTENANCE OF PROPERTIES AND LEASES.
Each Loan Party shall, and shall cause each of its Subsidiaries to, maintain in
good repair, working order and condition (ordinary wear and tear excepted) in
accordance with the general practice of other businesses of similar character
and size, all of those material properties necessary to its business, and from
time to time, such Loan Party or such Subsidiary will make or cause to be made
all appropriate repairs, renewals or replacements thereof.
7.1.5 MAINTENANCE OF PATENTS, TRADEMARKS, ETC.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
maintain in full force and effect all patents, trademarks, service marks, trade
names, copyrights, licenses, franchises, permits and other authorizations
necessary for the ownership and operation of its properties and business if the
failure so to maintain the same would constitute a Material Adverse Change.
7.1.6 VISITATION RIGHTS.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
permit any of the officers or authorized employees or representatives of the
Documentation Agent, the Administrative Agent or any of the Revolving Credit
Banks to visit and inspect any of its properties and to examine and make
excerpts from its books and records and discuss its business affairs, finances
and accounts with its officers, all in such detail and at such times and as
often as any of the Revolving Credit Banks may reasonably request, PROVIDED that
each Revolving Credit Bank shall provide the Borrower and the Administrative
Agent with reasonable notice prior to any visit or inspection.
7.1.7 KEEPING OF RECORDS AND BOOKS OF ACCOUNT.
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The Company shall, and shall cause each Subsidiary of the Company
including the Borrower to, maintain and keep proper books and records which
enable the Company and its Subsidiaries to issue financial statements in
accordance with GAAP and as otherwise required by applicable Laws of any
Official Body having jurisdiction over the Company or any Subsidiary of the
Company, and in which full, true and correct entries shall be made in all
material respects of all its dealings and business and financial affairs.
7.1.8 PLANS AND BENEFIT ARRANGEMENTS.
The Company shall, and shall cause each other member of the ERISA Group
to, comply with ERISA, the Internal Revenue Code and other applicable Laws
applicable to Plans and Benefit Arrangements except where such failure, alone or
in conjunction with any other failure, would not result in a Material Adverse
Change. Without limiting the generality of the foregoing, the Company shall
cause all of its Plans and all Plans maintained by any other member of the ERISA
Group to be funded in accordance with the minimum funding requirements of ERISA
and shall make, and cause each other member of the ERISA Group to make, in a
timely manner, all contributions due to Plans, Benefit Arrangements and
Multiemployer Plans.
7.1.9 COMPLIANCE WITH LAWS.
Each Loan Party shall, and shall cause each of its Subsidiaries to,
comply with all applicable Laws, including all Environmental Laws, in all
respects, PROVIDED that it shall not be deemed to be a violation of this Section
7.1.9 if any failure to comply with any Law would not result in fines,
penalties, remediation costs, other similar liabilities or injunctive relief
which in the aggregate would constitute a Material Adverse Change.
7.1.10 USE OF PROCEEDS.
The Borrower will use the Letters of Credit and the proceeds of the
Loans only for lawful purposes in accordance with Section 2.8 and such uses
shall not contravene any applicable Law or any other provision hereof.
7.1.11 SUBORDINATION OF INTERCOMPANY LOANS.
Each Loan Party shall cause any Intercompany Loans owed by any Loan
Party to any other Loan Party or Subsidiary of a Loan Party to be subordinated
pursuant to the terms of the Master Intercompany Subordination Agreement.
7.2 NEGATIVE COVENANTS.
The Borrower covenants and agrees that until payment in full of the
Revolving Credit Loans and Reimbursement Obligations and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties' other Obligations hereunder and termination of the Revolving
Credit Commitments, the Loan Parties shall comply with the following negative
covenants:
7.2.1 INDEBTEDNESS.
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Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, at any time create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness under the Loan Documents;
(ii) existing Indebtedness as set forth on SCHEDULE 7.2.1,
including any extensions or renewals thereof, PROVIDED
there is no increase in the amount thereof or imposition
of additional material obligations therein unless
otherwise specified on SCHEDULE 7.2.1;
(iii) capitalized and operating leases;
(iv) Intercompany Loans which is subordinated in accordance
with the provisions of Section 7.1.11;
(v) Indebtedness secured by Purchase Money Security Interests
not exceeding $10,000,000;
(vi) Indebtedness of a Loan Party to another Loan Party;
(vii) the Subordinated Notes;
(viii) Indebtedness permitted under Section 7.2.3;
(ix) commercial paper maturing in not more than 180 days; and
(x) any other Indebtedness not referenced above which does not
exceed in the aggregate at any one time outstanding
$200,000,000.
7.2.2 LIENS.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, (i) at any time create, incur, assume or suffer to exist any
Lien on any of its property or assets, tangible or intangible, now owned or
hereafter acquired, or agree or become liable to do so, except Permitted Liens
or (ii) at any time agree, directly or indirectly, with respect to any asset
material to the Borrower and its Subsidiaries taken as a whole to any
restriction (including without limitation on the foregoing any requirement to
grant a third Person a Lien in the event that the Banks are granted a Lien) on
the granting or conveying of Liens to the Banks.
7.2.3 GUARANTIES.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, at any time, directly or indirectly, become or be liable in
respect of any Guaranty, or assume, guarantee, become surety for, endorse or
otherwise agree, become or remain directly or contingently liable upon or with
respect to any obligation or liability of any other Person, except for
Guaranties of Indebtedness of the Loan Parties permitted hereunder; provided,
however, that no Subsidiary of the Borrower shall guaranty the Subordinated
Notes.
7.2.4 LOANS AND INVESTMENTS.
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Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, at any time make or suffer to remain outstanding any loan or
advance to, or purchase, acquire or own any stock, bonds, notes or securities
of, or any partnership interest (whether general or limited) in, or any other
investment or interest in, or make any capital contribution to, any other
Person, or agree, become or remain liable to do any of the foregoing, except as
set forth on SCHEDULE 7.2.4 and:
(i) trade credit extended on usual and customary terms in the
ordinary course of business;
(ii) advances to employees to meet expenses incurred by such
employees in the ordinary course of business;
(iii) Permitted Investments;
(iv) loans, advances and investments in other Loan Parties and
Subsidiaries of Loan Parties;
(v) Indebtedness permitted by Section 7.2.1, liquidations,
mergers, consolidations and acquisitions permitted by
Section 7.2.6, and capital expenditures; and
(vi) Investments other than those set forth herein above not
to exceed $35,000,000 at any time outstanding.
7.2.5 DIVIDENDS AND RELATED DISTRIBUTIONS.
Except as provided herein, each of the Loan Parties shall not, and
shall not permit any of its Subsidiaries to, make or pay, or agree to become or
remain liable to make or pay, any dividend or other distribution of any nature
(whether in cash, property, securities or otherwise) on account of or in respect
of its shares of capital stock or partnership interests on account of the
purchase, redemption, retirement or acquisition of its shares of capital stock
(or warrants, options or rights therefor) or partnership interests, except
dividends or other distributions payable to another Loan Party. The Company may
declare and pay dividends on its capital stock which are payable solely in
shares of its capital stock or other equity interests of the Company. Except
during the existence of an Event of Default, the Company may (i) pay cash
dividends on its capital stock, or (ii) make purchases and redemptions of its
capital stock pursuant to existing plans, PROVIDED that the aggregate of all
such cash dividends, purchases and redemptions referred to in clauses (i) and
(ii) does not exceed $50,000,000 between the Closing Date and the payment in
full of all Obligations hereunder and the termination of the Revolving Credit
Commitments.
7.2.6 LIQUIDATIONS, MERGERS, CONSOLIDATIONS, ACQUISITIONS.
Except as permitted by Section 7.2.7, each of the Loan Parties shall
not, and shall not permit any of the Company, the Borrower and the Material
Subsidiaries to, dissolve, liquidate or windup its affairs, or become a party to
any merger or consolidation, or acquire by purchase, lease or otherwise all or
substantially all of the assets or capital stock of any other Person; PROVIDED
that any Loan Party other than the Borrower and the Company may consolidate,
liquidate, dissolve or merge into, or acquire, another Loan Party which is
wholly-owned, directly or indirectly, by the Company; and PROVIDED further that
any Loan Party may acquire by merger, purchase or otherwise all or substantially
all of the assets of any other Person or any division or subsidiary of such
other Person if (a) the Borrower is in compliance with all of the provisions of
this Agreement immediately prior to such acquisition and after giving effect to
such acquisi-
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tion the Borrower will be in compliance with all of the provisions of this
Agreement and (b) with respect to any acquisition of capital stock of another
Person, Borrower shall acquire at least fifty percent (50%) of such capital
stock so that such other Person shall become a Subsidiary of the Borrower, and
such Person shall join in the Master Guaranty Agreement in accordance with
Section 10.18, provided that any Subsidiary which is organized, owns assets and
conducts its business in a jurisdiction other than the United States (each a
"Foreign Subsidiary") shall not be required to join the Master Guaranty
Agreement if both of the following are true: (i) the total assets of all of the
Foreign Subsidiaries which are not Guarantors is less than 10% of the total
consolidated assets of the Company and its Subsidiaries and (ii) the total
consolidated revenues of all of the Foreign Subsidiaries which are not
Guarantors for the immediately preceding fiscal year is less than 10% of the
total consolidated revenues of the Company and its Subsidiaries for such year.
7.2.7 DISPOSITIONS OF ASSETS OR SUBSIDIARIES.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, sell, convey, assign, lease, abandon or otherwise transfer or
dispose of, voluntarily or involuntarily, any of its properties or assets,
tangible or intangible (including sale, assignment, discount or other
disposition of accounts, contract rights, chattel paper, equipment or general
intangibles with or without recourse or of capital stock, shares of beneficial
interest or partnership interests of a Subsidiary of such Loan Party), except:
(i) transactions involving the sale of inventory in the
ordinary course of business;
(ii) any sale, transfer or lease of assets in the ordinary
course of business which are no longer necessary or
required in the conduct of such Loan Party's or such
Subsidiary's business;
(iii) any sale, transfer or lease of assets by any wholly owned
Subsidiary of such Loan Party to another Loan Party;
(iv) any sale, transfer or lease of assets, other than
those specifically excepted pursuant to clauses (i)
through (iii) above or clauses (v) and (vi) below,
provided that there shall not exist any Event of Default
or Potential Default after such sale and the Loan Parties
shall be in compliance with all of the covenants
herein applicable to any Loan Party or its Subsidiaries
including those in Section 7.2.10 (Continuation of or
Change in Business), 7.2.16 (Minimum Fixed Charge
Coverage Ratio), 7.2.17 (Total Indebtedness to Total
Capitalization Ratio) and 7.2.18 (Minimum Tangible Net
Worth) and the Borrower shall deliver a certificate to
the Administrative Agent for the benefit of the Banks at
least five (5) Business Days before such sale confirming
the same;
(v) any sale or transfer by the Company of the capital stock
or other equity interests of the Company; and
(vi) cash payments pursuant to transactions not prohibited
hereunder.
7.2.8 AFFILIATE TRANSACTIONS.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, enter into or carry out any transaction with any of its
Affiliates (including purchasing property or services from or selling property
or services to
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any Affiliate of any Loan Party or other Person other than a Loan Party) unless
such transaction is not otherwise prohibited by this Agreement, is entered into
in the ordinary course of business upon fair and reasonable arm's-length terms
and conditions (including without limitation employment arrangements with any
Executive Officer of the Borrower and its Subsidiaries) which are fully
disclosed to the Administrative Agent and is in accordance with all applicable
Law.
7.2.9 SUBSIDIARIES, PARTNERSHIPS AND JOINT VENTURES.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, own or create directly or indirectly any Subsidiaries other
than (i) any Subsidiary which has joined this Agreement as Guarantor on the
Closing Date; (ii) any Subsidiary acquired or formed after the Closing Date
which joins this Agreement as a Guarantor pursuant to Section 10.18; and (iii)
any Foreign Subsidiary, provided that such Foreign Subsidiary shall join this
Agreement as a Guarantor if the conditions described in both clauses (i) and
(ii) of the last sentence of Section 7.2.6 are not met. Each of the Loan Parties
shall not become or agree to become a general or limited partner in any general
or limited partnership or a joint venturer in any joint venture other than (i)
solely with other Loan Parties; (ii) as permitted by Section 7.2.4; (iii) for
the acquisition of inventory; and (iv) for transactions which when aggregated do
not exceed $20,000,000, except that the Loan Parties may be general or limited
partners in other Loan Parties.
7.2.10 CONTINUATION OF OR CHANGE IN BUSINESS.
Each of the Company and the Borrower shall not, and shall not permit
any of its Subsidiaries to, engage in any business other than the wholesale and
retail sale of general merchandise, substantially as conducted and operated by
the Company, the Borrower and their Subsidiaries and as conducted and operated
by ▇▇▇-Bee Center, Inc. and its Subsidiaries, during the 1996 fiscal year. This
Section 7.2.10 shall not prohibit the Company, the Borrower or any Subsidiary
thereof from engaging in a business which provides services common to the retail
or wholesale trade in general merchandise to the Company, the Borrower or any
Subsidiary thereof or to any Person engaged in the sale of general retail
merchandise.
7.2.11 PLANS AND BENEFIT ARRANGEMENTS.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to:
(i) fail to satisfy the minimum funding requirements of ERISA
and the Internal Revenue Code with respect to any Plan
where such would result in a Material Adverse Change;
(ii) request a minimum funding waiver from the Internal Revenue
Service with respect to any Plan;
(iii) engage in a Prohibited Transaction with any Plan, Benefit
Arrangement or Multiemployer Plan which, alone or in
conjunction with any other circumstances or set of
circumstances resulting in liability under ERISA, would
constitute a Material Adverse Change;
(iv) permit, as of the end of any calendar year, the aggregate
accumulated benefit obligations determined in accordance
with GAAP for all Plans to exceed by more than $8 million
the fair market value of all assets of the Plans;
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(v) fail to make when due any contribution to any
Multiemployer Plan that the Borrower or any member of the
ERISA Group may be required to make under any agreement
relating to such Multiemployer Plan, or any Law pertaining
thereto where such would result in a Material Adverse
Change;
(vi) withdraw (completely or partially) from any Multiemployer
Plan or withdraw (or be deemed under Section 4062(e) of
ERISA to withdraw) from any Multiple Employer Plan, where
any such withdrawal is likely to result in a material
liability of the Borrower or any member of the ERISA
Group;
(vii) terminate, or institute proceedings to terminate, any
Plan, where such termination is likely to result in a
material liability to the Borrower or any member of the
ERISA Group;
(viii) make any amendment to any Plan with respect to which
security is required under Section 307 of ERISA; or
(ix) fail to give any and all notices and make all disclosures
and governmental filings required under ERISA or the
Internal Revenue Code, where such failure is likely to
result in a Material Adverse Change.
7.2.12 FISCAL YEAR.
The Company shall not, and shall not permit any Subsidiary of the
Company to, change its fiscal year from the fifty-two/fifty-three week fiscal
year beginning on the Sunday closest to February 1, and ending on the Saturday
closest to February 1 of each year.
7.2.13 ISSUANCE OF STOCK.
Each of the Loan Parties shall not, and shall not permit any of its
Subsidiaries to, issue any additional shares of its capital stock or any
options, warrants or other rights in respect thereof other than to another Loan
Party or Subsidiary of a Loan Party; provided, however, that nothing contained
herein shall prohibit the Company from issuing shares of its capital stock or
other equity interests of the Company.
7.2.14 CHANGES IN ORGANIZATIONAL DOCUMENTS.
Except as permitted by Section 7.2.6, each of the Loan Parties shall
not, and shall not permit any of its Subsidiaries to, amend in any respect its
certificate of incorporation (including any provisions or resolutions relating
to capital stock), by-laws or other organizational documents without providing
at least five (5) calendar days' prior written notice to the Administrative
Agent and the Banks and, in the event such change would be adverse to the Banks
as determined by the Required Banks in their sole discretion, obtaining the
prior written consent of the Required Banks.
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7.2.15 MINIMUM FIXED CHARGE COVERAGE RATIO.
The Loan Parties shall not permit at any time the Fixed Charge Coverage
Ratio, calculated as of the end of each fiscal quarter to be less than 1.35 to
1.0 for fiscal quarters ending on or before January 31, 1999 and 1.5 to 1.0
thereafter.
7.2.16 TOTAL INDEBTEDNESS TO TOTAL CAPITALIZATION RATIO.
The Loan Parties shall not permit at any time the ratio of (i) the sum
of (A) Indebtedness of the Company and its Subsidiaries determined and
consolidated in accordance with GAAP plus (B) the product of four times the
Consolidated Rentals, to (ii) the sum of (A) Indebtedness of the Company and its
Subsidiaries determined and consolidated in accordance with GAAP plus (B) the
product of four times the Consolidated Rentals plus (C) the stockholders equity
of the Company and its Subsidiaries determined and consolidated in accordance
with GAAP, to be greater than (1) .7 to 1.0 as of the end of each fiscal quarter
other than fiscal quarters which end on the fiscal year end of the Company, and
(2) .6 to 1.0 as of the end of each fiscal year of the Company.
7.2.17 MINIMUM TANGIBLE NET WORTH.
The Loan Parties shall not permit at any time Consolidated Tangible Net
Worth to be less than the Base Tangible Net Worth.
7.2.18 AMENDMENTS TO CERTAIN DOCUMENTS.
The Loan Parties shall not permit, without the prior written consent of
the Required Banks, any amendment, waiver or modification to the Subordinated
Note Agreement or the Subordinated Notes, or any other document or instrument
delivered in connection with any of the foregoing except for amendments, waivers
or modifications to provisions other than those which subordinate the
obligations of the Borrower under the Subordinated Notes and the Subordinated
Note Agreement to the Obligations and which amendments, waivers or modifications
do not change or otherwise affect the terms of such agreements or instruments in
a material manner.
7.2.19 NO PREPAYMENT OF SUBORDINATED DEBT.
The Loan Parties shall not permit the payment or prepayment, directly
or indirectly (including without limitation of the foregoing any purchase of one
or more of the notes issued thereunder or any interest or participation in any
such notes or any redemption of any of the Subordinated Notes), of any principal
of the Subordinated Notes (provided that this provision shall not prohibit
transfers by any holder or holders of the Subordinated Notes to Persons other
than the Company and direct or indirect Subsidiaries of the Company), except
that the Borrower may prepay principal of such Subordinated Notes or pay the
principal of such Subordinated Notes on the due date thereof provided that after
giving effect to such payment (i) none of the circumstances described in Section
22.2 or 22.3 of the Subordinated Note Agreement shall exist, (ii) the Loan
Parties shall be in compliance with the terms of this Agreement and no Potential
Default or Event of Default shall then exist, (iii) the Loan Parties shall have
adequate liquidity to meet their working capital needs, and (iv) the Borrower
shall deliver a certificate in the form of Exhibit 7.2.19 evidencing the matters
described in clauses (i), (ii) and (iii) (including demonstrations of compliance
with the Borrower's financial covenants) and (v) the Administrative Agent, the
Syndication Agent, the Co-Syndication Agent and the Documentation Agent shall
have, in their reasonable discretion, approved of the Borrower's certificate
described in clause (iv) and concurred with
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the Borrower's determinations made thereon and shall have acknowledged in
writing such approval and concurrence. All payments of principal, interest or
other amounts by the Borrower under the Subordinated Notes are subject to the
terms of subordination governing such Subordinated Notes contained in Section 22
of the Subordinated Note Agreement or in any other provisions of the
Subordinated Note Agreement or Subordinated Notes and the Agents and the Banks
do not hereby waive or limit in any manner such terms of subordination.
7.2.20 INVENTORY PURCHASES.
The Loan Parties shall not permit (i) any material amount of inventory
to be purchased by any Person other than the Borrower and the Material
Subsidiaries or (ii) any Loan Party or any Subsidiary of a Loan Party, other
than the Borrower and the Material Subsidiaries, to be obligated directly or
indirectly to any Person other than a Loan Party with respect to any material
amount of purchased inventory.
7.2.21 NEGATIVE PLEDGES.
Each of the Loan Parties covenants and agrees that it shall not, and
shall not permit any of its Subsidiaries to, enter into any agreement with any
Person which prohibits or restricts in any manner the right of any of the Loan
Parties to grant Liens in any of their assets to any Person or imposes any
conditions which must be satisfied in order for any such Liens to be so granted
or creates any breach or default, whether absolute, conditional or potential
upon the occurrence of any grant of such Liens.
7.2.22 ACKNOWLEDGMENTS.
There shall be delivered to the Administrative Agent for the benefit of
each Bank a signed signature page to the Acknowledgment of the Master Guaranty
Agreement and Master Intercompany Subordination Agreement ("Acknowledgment") by
the Company, and a written opinion of Benesch, Friedlander, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
L.L.P. and of ▇▇▇▇▇▇ ▇. ▇▇▇▇, Esquire, counsel for the Loan Parties on or before
May 21, 1998, addressing the authorization, execution and delivery of such
Acknowledgment by the Company and the enforceability of such Acknowledgment with
respect to the Company (in a form similar to the form of opinion referenced in
Section 6.1.4).
7.3 REPORTING REQUIREMENTS.
The Borrower covenants and agrees that until payment in full of the
Revolving Credit Loans and Reimbursement Obligations and interest thereon,
expiration or termination of all Letters of Credit, satisfaction of all of the
Loan Parties' other Obligations hereunder and under the other Loan Documents and
termination of the Revolving Credit Commitments, the Loan Parties will furnish
or cause to be furnished to the Administrative Agent and each of the Revolving
Credit Banks:
7.3.1 QUARTERLY FINANCIAL STATEMENTS.
As soon as available and in any event within forty-five (45) calendar
days after the end of each of the first three fiscal quarters in each fiscal
year, financial statements of the Company, consisting of a consolidated and
consolidating balance sheet as of the end of such fiscal quarter and related
consolidated and consolidating statements of income, stockholders' equity and
cash flows for the fiscal quarter then ended and the fiscal year through that
date, all in reasonable detail and certified (subject to normal year-end audit
adjustments) by the Chief Executive Officer, Presi-
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dent or Chief Financial Officer of the Borrower as having been prepared in
accordance with GAAP and as to fairness of presentation, consistently applied,
and setting forth in comparative form the respective financial statements for
the corresponding date and period in the previous fiscal year. Wherever
referenced in this Section 7, the term "consolidating" is limited to
consolidating information on a basis consistent with current accounting
practices of the Company.
7.3.2 ANNUAL FINANCIAL STATEMENTS.
As soon as available and in any event within ninety (90) days after the
end of each fiscal year of the Company, consolidated and consolidating financial
statements of the Company consisting of a consolidated and consolidating balance
sheet as of the end of such fiscal year, and related consolidated and
consolidating statements of income, stockholders' equity and cash flows for the
fiscal year then ended, all in reasonable detail and setting forth in
comparative form the financial statements as of the end of and for the preceding
fiscal year, and with respect to the consolidated statements, certified by
independent certified public accountants of nationally recognized standing
satisfactory to the Administrative Agent. The certificate or report of
accountants shall be free of qualifications (other than any consistency
qualification that may result from a change in the method used to prepare the
financial statements as to which such accountants concur) and shall not indicate
the occurrence or existence of any event, condition or contingency which would
materially impair the prospect of payment or performance of any covenant,
agreement or duty of any Loan Party under any of the Loan Documents, together
with a letter of such accountants substantially to the effect that, based upon
their ordinary and customary examination of the affairs of the Company,
performed in connection with the preparation of such consolidated financial
statements, and in accordance with generally accepted auditing standards, they
are not aware of the existence of any condition or event which constitutes an
Event of Default or Potential Default or, if they are aware of such condition or
event, stating the nature thereof and confirming the Borrower's calculations
with respect to the certificate to be delivered pursuant to Section 7.3.3 with
respect to such financial statements.
7.3.3 CERTIFICATE OF THE BORROWER.
Concurrently with the financial statements of the Company furnished to
the Administrative Agent and to the Revolving Credit Banks pursuant to Sections
7.3.1 and 7.3.2, a certificate of the Borrower and the Company signed by the
Chief Executive Officer, President or Chief Financial Officer of the Borrower
and the Company, in the form of EXHIBIT 7.3.3, to the effect that, except as
described pursuant to Section 7.3.4, (i) the representations and warranties
contained in Article and in the other Loan Documents are true on and as of the
date of such certificate with the same effect as though such representations and
warranties had been made on and as of such date (except representations and
warranties which expressly relate solely to an earlier date or time) and the
Loan Parties have performed and complied with all covenants and conditions
hereof, (ii) no Event of Default or Potential Default exists and is continuing
on the date of such certificate and (iii) containing calculations in sufficient
detail to demonstrate compliance as of the date of such financial statements
with all financial covenants contained in Section 7.2.
7.3.4 NOTICE OF DEFAULT.
Promptly after any officer of any Loan Party has learned of the
occurrence of an Event of Default or Potential Default, a certificate signed by
the Chief Executive Officer, President or Chief Financial Officer of such Loan
Party setting forth the details of such Event of Default or Potential Default
and the action which the such Loan Party proposes to take with respect thereto.
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7.3.5 NOTICE OF LITIGATION.
Promptly after the commencement thereof, notice of all actions, suits,
proceedings or investigations before or by any Official Body or any other Person
against any Loan Party or Subsidiary of any Loan Party which involve a claim or
series of uninsured claims (provided that a claim shall be deemed to be
uninsured unless the insurance company is a reputable insurance company and has
acknowledged that the claim is covered by the applicable insurance policy
without any reservation to challenge the applicability thereof) in excess of
$10,000,000 or which if adversely determined would constitute a Material Adverse
Change.
7.3.6 CERTAIN EVENTS.
Written notice:
(i) at least five (5) Business Days prior thereto, with
respect to any proposed sale or transfer of assets
pursuant to Section 7.2.7(iv) which exceed $25 million,
and
(ii) within the time limits set forth in Section 7.2.14, any
amendment to the organizational documents of any Loan
Party.
7.3.7 REPORTS AND INFORMATION.
Promptly upon their becoming available to any Loan Party:
(i) any reports including management letters submitted to the
Company or the Borrower by independent accountants in
connection with any annual, interim or special audit;
(ii) any reports, notices or proxy statements generally
distributed by the Company to its stockholders on a date
no later than the date supplied to such stockholders;
(iii) regular or periodic reports, including Forms 10-K, 10-Q
and 8-K, registration statements and prospectuses, as may
be filed by the Company with the Securities and Exchange
Commission;
(iv) a copy of any order in any proceeding to which the
Company, the Borrower or any of its Subsidiaries is a
party issued by any Official Body; and
(v) such other reports and information as any of the Revolving
Credit Banks may from time to time reasonably request. The
Loan Parties shall also notify the Revolving Credit Banks
promptly of the enactment or adoption of any Law which may
result in a Material Adverse Change.
7.3.8 NOTICES REGARDING PLANS AND BENEFIT ARRANGEMENTS.
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7.3.8.1 CERTAIN EVENTS.
Promptly upon becoming aware of the occurrence thereof, notice
(including the nature of the event and, when known, any action taken or
threatened by the Internal Revenue Service or the PBGC with respect thereto) of:
(i) any Reportable Event with respect to the Company or any
other member of the ERISA Group (regardless of whether the
obligation to report said Reportable Event to the PBGC has
been waived),
(ii) any Prohibited Transaction which could subject the Company
or any other member of the ERISA Group to a civil penalty
assessed pursuant to Section 502(i) of ERISA or a tax
imposed by Section 4975 of the Internal Revenue Code in
connection with any Plan, any Benefit Arrangement or any
trust created thereunder,
(iii) any assertion of material withdrawal liability with
respect to any Multiemployer Plan,
(iv) any partial or complete withdrawal from a Multiemployer
Plan by the Company or any other member of the ERISA Group
under Title IV of ERISA (or assertion thereof), where such
withdrawal is likely to result in material withdrawal
liability,
(v) any cessation of operations (by the Company or any other
member of the ERISA Group) at a facility in the
circumstances described in Section 4063(e) of ERISA,
(vi) withdrawal by the Company or any other member of the ERISA
Group from a Multiple Employer Plan,
(vii) a failure by the Company or any other member of the ERISA
Group to make a payment to a Plan required to avoid
imposition of a Lien under Section 302(f) of ERISA,
(viii) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307
of ERISA, or
(ix) any change in the actuarial assumptions or funding methods
used for any Plan, where the effect of such change is to
materially increase or materially reduce the unfunded
benefit liability or obligation to make periodic
contributions.
7.3.8.2 NOTICES OF INVOLUNTARY TERMINATION AND ANNUAL
REPORTS.
Promptly after receipt thereof, copies of (a) all notices received by
the Company or any other member of the ERISA Group of the PBGC's intent to
terminate any Plan administered or maintained by the Company or any member of
the ERISA Group, or to have a trustee appointed to administer any such Plan; and
(b) at the request of the Administrative Agent or any Revolving Credit Bank each
annual report (IRS Form 5500 series) and all accompanying schedules, the most
recent actuarial reports, the most recent financial information concerning the
financial status of each Plan administered or maintained by the Company or any
other member of the ERISA Group, and schedules showing the amounts contributed
to each such Plan by or on behalf of the Company or any other member of the
ERISA Group in which any of their personnel participate or from which such
personnel may derive a benefit, and each Schedule B
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(Actuarial Information) to the annual report filed by the Company or any other
member of the ERISA Group with the Internal Revenue Service with respect to each
such Plan.
7.3.8.3 NOTICE OF VOLUNTARY TERMINATION.
Promptly upon the filing thereof, copies of any Form 5310, or any
successor or equivalent form to Form 5310, filed with the PBGC in connection
with the termination of any Plan.
8. DEFAULT
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8.1 EVENTS OF DEFAULT.
An Event of Default shall mean the occurrence or existence of any one
or more of the following events or conditions (whatever the reason therefor and
whether voluntary, involuntary or effected by operation of Law):
8.1.1 PAYMENTS UNDER LOAN DOCUMENTS.
The Borrower shall fail to pay when due any principal of any Loan
(including scheduled installments, mandatory prepayments or the payment due at
maturity) or any Reimbursement Obligations or shall fail to pay within three (3)
Business Days when due any interest on any Loan or on any Reimbursement
Obligations or any other amount owing hereunder or under the other Loan
Documents after such principal, interest or other amount becomes due in
accordance with the terms hereof or thereof;
8.1.2 BREACH OF WARRANTY.
Any representation or warranty made or deemed made at any time by any
of the Loan Parties herein or by any of the Loan Parties in any other Loan
Document, or in any certificate, other instrument or statement furnished
pursuant to the provisions hereof or thereof, shall prove to have been false or
misleading in any material respect as of the time it was made or deemed made or
furnished;
8.1.3 BREACH OF NEGATIVE COVENANTS.
Any of the Loan Parties shall default in the observance or performance
of any covenant contained in Section 7.2;
8.1.4 BREACH OF OTHER COVENANTS.
Any of the Loan Parties shall default in the observance or performance
of any other covenant, condition or provision hereof or of any other Loan
Document and such default shall continue unremedied for a period of ten (10)
Business Days after any Executive Officer of the Borrower or the Company becomes
aware of the occurrence thereof (such grace period to be applicable only in the
event such default can be remedied by corrective action of the Loan Parties as
determined by the Managing Agents in their sole discretion);
8.1.5 DEFAULTS IN OTHER AGREEMENTS OR INDEBTEDNESS.
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If a breach, default or event of default shall occur at any time under
the terms of any other agreement involving borrowed money or the extension of
credit or any other Indebtedness under which any Loan Party or Subsidiary of any
Loan Party may be obligated as a borrower or guarantor in excess of $10,000,000
in the aggregate and such breach, default or event of default consists of the
failure to pay (beyond any period of grace permitted with respect thereto,
whether waived or not) any indebtedness when due (whether at stated maturity, by
acceleration or otherwise) or such breach or default permits or causes the
acceleration of any indebtedness (whether or not such right shall have been
waived) or the termination of any commitment to lend;
8.1.6 FINAL JUDGMENTS OR ORDERS.
Any final judgments or orders for the payment of money in excess of
$10,000,000 in the aggregate shall be entered against any Loan Party by a court
having jurisdiction in the premises, which judgment either (i) is not
discharged, vacated, bonded or stayed pending appeal within a period of sixty
(60) days from the date of entry, or (ii) is not fully insured (provided that a
judgment shall be deemed to be uninsured unless the insurance company is a
reputable insurance company and has acknowledged that the judgment is covered by
the applicable insurance policy without any reservation to challenge the
applicability thereof) or any Loan Parties' or any of their Subsidiaries' assets
having a value on the Company's books in excess of $10,000,000 are attached,
seized, levied upon or subjected to a writ or distress warrant; or such come
within the possession of any receiver, trustee, custodian or assignee for the
benefit of creditors and the same is not cured within sixty (60) days
thereafter;
8.1.7 LOAN DOCUMENT UNENFORCEABLE.
Any of the Loan Documents shall cease to be legal, valid and binding
agreements enforceable against the party executing the same or such party's
successors and assigns (as permitted under the Loan Documents) in accordance
with the respective terms thereof or shall in any way be terminated (except in
accordance with its terms) or become or be declared ineffective or inoperative
or shall in any way be challenged or contested;
8.1.8 NOTICE OF LIEN OR ASSESSMENT.
A notice of Lien or assessment in excess of $10,000,000 which is not a
Permitted Lien is filed of record with respect to all or any part of any of the
Loan Parties' or any of their Subsidiaries' assets by the United States, or any
department, agency or instrumentality thereof, or by any state, county,
municipal or other governmental agency, including the PBGC, or if any taxes or
debts owing at any time or times hereafter to any one of these becomes payable
and the same is not paid within sixty (60) days after the same becomes payable
(unless the validity or amount thereof is being contested in good faith by
appropriate and lawful proceedings diligently conducted so long as levy and
execution thereon have been stayed and continue to be stayed);
8.1.9 INSOLVENCY.
The Company, the Borrower, any Material Subsidiary, or one or more
other Subsidiaries of the Borrower which individually or in the aggregate
represent more than five percent (5%) of the book value of the consolidated
assets of the Borrower and its Subsidiaries, ceases to be able to pay its debts
as they become due or admits in writing its inability to pay its debts as they
mature;
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8.1.10 EVENTS RELATING TO PLANS AND BENEFIT ARRANGEMENTS.
Any of the following occurs: (i) any Reportable Event, which the
Documentation Agent and the Administrative Agent determine in good faith
constitutes grounds for the termination of any Plan by the PBGC or the
appointment of a trustee to administer or liquidate any Plan, shall have
occurred and be continuing; (ii) proceedings shall have been instituted or other
action taken to terminate any Plan, or a termination notice shall have been
filed with respect to any Plan; (iii) a trustee shall be appointed to administer
or liquidate any Plan; (iv) the PBGC shall give notice of its intent to
institute proceedings to terminate any Plan or Plans or to appoint a trustee to
administer or liquidate any Plan; and, in the case of the occurrence of (i),
(ii), (iii) or (iv) above, the Administrative Agent determines in good faith
that the amount of the Company's liability is likely to exceed 10% of its
Consolidated Tangible Net Worth; (v) the Company or any member of the ERISA
Group shall fail to make any contributions when due to a Plan or a Multiemployer
Plan; (vi) the Company or any other member of the ERISA Group shall make any
amendment to a Plan with respect to which security is required under Section 307
of ERISA; (vii) the Company or any other member of the ERISA Group shall
withdraw completely or partially from a Multiemployer Plan; (viii) the Company
or any other member of the ERISA Group shall withdraw (or shall be deemed under
Section 4062(e) of ERISA to withdraw) from a Multiple Employer Plan; or (ix) any
applicable Law is adopted, changed or interpreted by any Official Body with
respect to or otherwise affecting one or more Plans, Multiemployer Plans or
Benefit Arrangements and, with respect to any of the events specified in (v),
(vi), (vii), (viii) or (ix), the Documentation Agent and the Administrative
Agent determine in good faith that any such occurrence would be reasonably
likely to materially and adversely affect the total enterprise represented by
the Company and the other members of the ERISA Group;
8.1.11 CESSATION OF BUSINESS.
Any of the Company, the Borrower, (except as permitted by Section 7.2.6
or Section 7.2.7) any Material Subsidiary, or (except as permitted by Section
7.2.6 or Section 7.2.7) one or more other Subsidiaries of the Borrower which
individually or in the aggregate represent more than five percent (5%) of the
book value of the consolidated assets of the Borrower and its Subsidiaries,
ceases to conduct its business as contemplated or such Loan Party is enjoined,
restrained or in any way prevented by court order from conducting all or any
material part of its business and such injunction, restraint or other preventive
order is not dismissed within thirty (30) days after the entry thereof;
8.1.12 CHANGE OF CONTROL.
(i) Any person or group of persons (within the meaning of Section 13(a)
or 14(a) of the Securities Exchange Act of 1934, as amended) shall have acquired
beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the
Securities and Exchange Commission under said Act) 33.33% or more of the voting
capital stock of the Company; or (ii) within a period of twelve (12) consecutive
calendar months, individuals who were directors on the board of directors of the
Company on the first day of such period together with any directors whose
election by such board of directors or whose nomination for election by the
shareholders was approved by a vote of the majority of the directors then in
office shall cease to constitute a majority of the board of directors of the
Company;
8.1.13 INVOLUNTARY PROCEEDINGS.
A proceeding shall have been instituted in a court having jurisdiction
in the premises seeking a decree or order for relief in respect of any the
Company, the Borrower, any Material Subsidiary, or any other Subsidiary the
result of which proceeding against such other Subsidiary would be a Material
Adverse Change, in an involuntary case under
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any applicable bankruptcy, insolvency, reorganization or other similar law now
or hereafter in effect, or for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator, conservator (or similar official) of
any Loan Party or any Subsidiary of any Loan Party for any substantial part of
its property, or for the winding-up or liquidation of its affairs, and such
proceeding shall remain undismissed or unstayed and in effect for a period of
sixty (60) consecutive days or such court shall enter a decree or order granting
any of the relief sought in such proceeding; or
8.1.14 VOLUNTARY PROCEEDINGS.
Any of the Company, the Borrower, any Material Subsidiary or any other
Subsidiary the result of which voluntary case by such other Subsidiary would be
a Material Adverse Change, shall commence a voluntary case under any applicable
bankruptcy, insolvency, reorganization or other similar law now or hereafter in
effect, shall consent to the entry of an order for relief in an involuntary case
under any such law, or shall consent to the appointment or taking possession by
a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator
(or other similar official) of itself or for any substantial part of its
property or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take any
action in furtherance of any of the foregoing.
8.2 CONSEQUENCES OF EVENT OF DEFAULT.
8.2.1 EVENTS OF DEFAULT OTHER THAN BANKRUPTCY, INSOLVENCY OR
REORGANIZATION PROCEEDINGS.
If an Event of Default specified under Sections 8.1.1 through 8.1.12
shall occur and be continuing, the Banks and the Administrative Agent shall be
under no further obligation to make Loans or issue Letters of Credit, as the
case may be, no Swing Loans shall be made, and the Administrative Agent may, and
upon the request of the Required Banks, shall by written notice to the Borrower,
take one or more of the following actions: (i) terminate the Revolving Credit
Commitments and thereupon the Revolving Credit Commitments shall be terminated
and of no further force and effect, (ii) declare the unpaid principal amount of
the Revolving Credit Notes, the Swing Note and all Reimbursement Obligations
then outstanding and all interest accrued thereon, any unpaid fees and all other
Indebtedness of the Borrower to the Revolving Credit Banks hereunder and
thereunder to be forthwith due and payable, and the same shall thereupon become
and be immediately due and payable to the Administrative Agent for the benefit
of each Revolving Credit Bank without presentment, demand, protest or any other
notice of any kind, all of which are hereby expressly waived, and (iii) require
the Borrower to, and the Borrower shall thereupon, deposit in a non-interest
bearing account with the Administrative Agent, as cash collateral for its
Obligations under the Loan Documents, an amount equal to the maximum amount
currently or at any time thereafter available to be drawn on all outstanding
Letters of Credit, and the Borrower hereby pledges to the Administrative Agent
and the Banks, and grants to the Administrative Agent and the Banks a security
interest in, all such cash as security for such Obligations. Upon the curing of
all existing Events of Default to the satisfaction of the Required Banks, the
Administrative Agent shall return such cash collateral to the Borrower;
8.2.2 BANKRUPTCY, INSOLVENCY OR REORGANIZATION PROCEEDINGS.
If an Event of Default specified under Section 8.1.13 or 8.1.14 shall
occur, the Revolving Credit Commitments shall automatically terminate and be of
no further force and effect, the Banks shall make no Loans hereunder and the
Swing Lender shall make no Swing Loans hereunder and the unpaid principal amount
of the Revolving Credit Notes, the Swing Note and all Reimbursement Obligations
then outstanding and all interest accrued thereon, any unpaid fees and all other
Indebtedness of the Borrower to the Revolving Credit Banks hereunder and
thereunder shall be immedi-
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ately due and payable, without presentment, demand, protest or notice of any
kind, all of which are hereby expressly waived;
8.2.3 SET-OFF.
If an Event of Default shall occur and be continuing, any Bank to whom
any Obligation is owed by any Loan Party hereunder or under any other Loan
Document or any participant of such Bank which has agreed in writing to be bound
by the provisions of Section 9.13 and any branch, Subsidiary or Affiliate of
such Bank or participant anywhere in the world shall have the right, subject to
the approval of the Required Banks, in addition to all other rights and remedies
available to it, without notice to such Loan Party, to set off against and apply
to the then unpaid balance of all the Revolving Credit Loans and all other
Obligations of the Borrower and the other Loan Parties hereunder or under any
other Loan Document any debt owing to, and any other funds held in any manner
for the account of, the Borrower or such other Loan Party by such Bank or
participant or by such branch, Subsidiary or Affiliate, including all funds in
all deposit accounts (whether time or demand, general or special, provisionally
credited or finally credited, or otherwise) now or hereafter maintained by the
Borrower or such other Loan Party for its own account (but not including funds
held in custodian or trust accounts) with such Bank or participant or such
branch, Subsidiary or Affiliate. Such right shall exist whether or not any Bank
or the Administrative Agent shall have made any demand under this Agreement or
any other Loan Document, whether or not such debt owing to or funds held for the
account of the Borrower or such other Loan Party is or are matured or unmatured
and regardless of the existence or adequacy of any collateral, any Guaranty or
any other security, right or remedy available to any Bank or the Administrative
Agent;
8.2.4 SUITS, ACTIONS, PROCEEDINGS.
If an Event of Default shall occur and be continuing, and whether or
not the Administrative Agent shall have accelerated the maturity of Revolving
Credit Loans pursuant to any of the foregoing provisions of this Section 8.2,
the Administrative Agent or any Revolving Credit Bank, with the approval of the
Required Banks, if owed any amount with respect to the Revolving Credit Notes,
may proceed to protect and enforce its rights by suit in equity, action at law
and/or other appropriate proceeding, whether for the specific performance of any
covenant or agreement contained in this Agreement or the Revolving Credit Notes,
including as permitted by applicable Law the obtaining of the EX PARTE
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of the Administrative Agent or such Revolving Credit
Bank;
8.2.5 APPLICATION OF PROCEEDS.
From and after the date on which the Administrative Agent has taken any
action pursuant to this Section 8.2 and until all Obligations of the Loan
Parties have been paid in full, any and all proceeds received by the
Administrative Agent from any sale or other disposition of any collateral, or
any part thereof, the exercise of any other remedy by the Administrative Agent,
shall be applied as follows:
(i) first, to reimburse the Administrative Agent and the
Banks for out-of-pocket costs, expenses and disbursements,
including reasonable attorneys' and paralegals' fees and
legal expenses, incurred by the Administrative Agent or
the Banks in connection with realizing on any collateral
or collection of any Obligations of any of the Loan
Parties under any of the Loan Documents, including
advances made by the Banks or any one of them or the
Administrative Agent for the reasonable
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maintenance, preservation, protection or enforcement of,
or realization upon, any collateral, including advances
for taxes, insurance, repairs and the like and reasonable
expenses incurred to sell or otherwise realize on, or
prepare for sale or other realization on, any of any
collateral;
(ii) second, to the repayment of all Indebtedness then due and
unpaid of the Loan Parties to the Banks incurred under
this Agreement or any of the other Loan Documents, whether
of principal, interest, fees, expenses or otherwise, in
such manner as the Managing Agents may determine in their
discretion; and
(iii) the balance, if any, to the Borrower or as required by
Law.
8.2.6 OTHER RIGHTS AND REMEDIES.
The Administrative Agent may, and upon the request of the Required
Banks shall, exercise all post-default rights granted to the Administrative
Agent and the Banks under the Loan Documents or applicable Law.
8.2.7 RIGHT OF COMPETITIVE BID LOAN BANKS.
If any Event of Default shall occur and be continuing, the Banks which
have any Bid Loans then outstanding to the Borrower (the "Bid Loan Banks") shall
not be entitled to accelerate payment of the Bid Loans or to exercise any right
or remedy related to the collection of the Bid Loans until the earlier of the
date on which the Revolving Credit Commitments shall be terminated hereunder
pursuant to Section 8.2 or the Revolving Credit Loans or any other Indebtedness
of the Borrower to the Revolving Credit Banks shall have become due and payable
pursuant to Section 8.2. Upon such a termination of the Revolving Credit
Commitments: (i) reference to Revolving Credit Loans and Revolving Credit Notes
in Section 8.2 shall be deemed to apply also to the Bid Loans and the Bid Notes,
respectively, and the Bid Loan Banks shall be entitled to all enforcement rights
given to a holder of Revolving Credit Loans in Section 8.2 and (ii) the
definition of Required Banks shall be changed as provided in Section 1.1 so that
each Bank shall have voting rights hereunder in proportion to its share of the
total Loans outstanding; provided that each Designating Bank shall serve as the
agent of its Designated Lender and as such shall exercise all voting, approval
and related rights on behalf of its Designated Lender as more fully described in
Section 10.11.3 and in the Designation Agreement.
8.3 NOTICE OF SALE.
Any notice required to be given by the Administrative Agent of a sale,
lease, or other disposition of the any collateral or any intended action by the
Administrative Agent, if given ten (10) days prior to such proposed action,
shall constitute commercially reasonable and fair notice thereof to the
Borrower.
9. THE MANAGING AGENTS
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9.1 APPOINTMENT.
Each Bank hereby irrevocably designates, appoints and authorizes PNC
Bank to act as Documentation Agent and National City Bank to act as
Administrative Agent for such Bank under this Agreement and to execute and
deliver or accept on behalf of each of the Banks the other Loan Documents. Each
Bank hereby irrevocably authorizes, and
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each holder of any Revolving Credit Note by the acceptance of a Revolving Credit
Note shall be deemed irrevocably to authorize, the Documentation Agent and the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and the other Loan Documents and any other instruments and
agreements referred to herein, and to exercise such powers and to perform such
duties hereunder as are specifically delegated to or required of the
Documentation Agent or the Administrative Agent by the terms hereof, together
with such powers as are reasonably incidental thereto. PNC Bank, agrees to act
as the Documentation Agent and National City Bank agrees to act as the
Administrative Agent on behalf of the Banks to the extent provided in this
Agreement.
9.2 DELEGATION OF DUTIES.
The Documentation Agent and the Administrative Agent may perform any of
their respective duties hereunder by or through agents or employees (PROVIDED
such delegation does not constitute a relinquishment of its duties as
Documentation Agent or Administrative Agent, respectively) and, subject to
Sections 9.5 and 9.6, shall be entitled to engage and pay for the advice or
services of any attorneys, accountants or other experts concerning all matters
pertaining to its duties hereunder and to rely upon any advice so obtained.
9.3 NATURE OF DUTIES; INDEPENDENT CREDIT INVESTIGATION.
The Documentation Agent, the Administrative Agent, the Managing Agents
and the Syndication Agent shall have no duties or responsibilities except those
expressly set forth in this Agreement and no implied covenants, functions,
responsibilities, duties, obligations, or liabilities shall be read into this
Agreement or otherwise exist. The duties of the Administrative Agent shall be
mechanical and administrative in nature. The Documentation Agent, the
Administrative Agent, the Managing Agents and the Syndication Agent shall not
have by reason of this Agreement a fiduciary or trust relationship in respect of
any Bank; and nothing in this Agreement, expressed or implied, is intended to or
shall be so construed as to impose upon the Documentation Agent, the
Administrative Agent, the Managing Agents or the Syndication Agent any
obligations in respect of this Agreement except as expressly set forth herein.
Each Bank expressly acknowledges (i) that the Documentation Agent, the
Administrative Agent, the Managing Agents and the Syndication Agent have not
made any representations or warranties to it and that no act by the
Documentation Agent, any Managing Agent, the Syndication Agent or the
Administrative Agent hereafter taken, including any review of the affairs of any
of the Loan Parties, shall be deemed to constitute any representation or
warranty by the Documentation Agent, any Managing Agent, the Syndication Agents
or the Administrative Agent to any Bank; (ii) that it has made and will continue
to make, without reliance upon the Documentation Agent, the Administrative
Agent, the Managing Agents and the Syndication Agent, its own independent
investigation of the financial condition and affairs and its own appraisal of
the creditworthiness of each of the Loan Parties in connection with this
Agreement and the making and continuance of the Loans hereunder; and (iii)
except as expressly provided herein, that the Documentation Agent, the Managing
Agents, the Syndication Agent and the Administrative Agent shall have no duty or
responsibility, either initially or on a continuing basis, to provide any Bank
with any credit or other information with respect thereto, whether coming into
its possession before the making of any Loan or at any time or times thereafter.
9.4 ACTIONS IN DISCRETION OF DOCUMENTATION AGENT AND
ADMINISTRATIVE AGENT; INSTRUCTIONS FROM THE BANKS.
The Documentation Agent and the Administrative Agent each agrees, upon
the written request of the Required Banks, to take or refrain from taking any
action of the type specified as being within the Documentation Agent's or the
Administrative Agent's rights, powers or discretion herein, PROVIDED that the
Documentation Agent or Administrative Agent shall not be required to take any
action which exposes the Documentation Agent or the Administrative
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Agent to personal liability or which is contrary to this Agreement or any other
Loan Document or applicable Law. In the absence of a request by the Required
Banks, the Documentation Agent or the Administrative Agent shall have authority,
in its sole discretion, to take or not to take any such action, unless this
Agreement specifically requires the consent of the Required Banks or all of the
Banks. Any action taken or failure to act pursuant to such instructions or
discretion shall be binding on the Banks, subject to Section 9.6. Subject to the
provisions of Section 9.6, no Bank shall have any right of action whatsoever
against the Administrative Agent as a result of the Documentation Agent or the
Administrative Agent acting or refraining from acting hereunder in accordance
with the instructions of the Required Banks, or in the absence of such
instructions, in the absolute discretion of the Documentation Agent or the
Administrative Agent.
9.5 REIMBURSEMENT AND INDEMNIFICATION OF ADMINISTRATIVE AGENT AND
DOCUMENTATION AGENT BY THE BORROWER.
The Borrower unconditionally agrees to pay or reimburse the
Administrative Agent and Documentation Agent and save the Administrative Agent
and Documentation Agent harmless against (a) liability for the payment of all
reasonable out-of-pocket costs, expenses and disbursements, including fees and
expenses of counsel, appraisers and environmental consultants, incurred by the
Administrative Agent and Documentation Agent (i) in connection with the
development, negotiation, preparation, printing, execution, administration,
syndication, interpretation and performance of this Agreement and the other Loan
Documents, (ii) relating to any requested amendments, waivers or consents
pursuant to the provisions hereof, (iii) in connection with the enforcement of
this Agreement or any other Loan Document or collection of amounts due hereunder
or thereunder or the proof and allowability of any claim arising under this
Agreement or any other Loan Document, whether in bankruptcy or receivership
proceedings or otherwise, and (iv) in any workout or restructuring or in
connection with the protection, preservation, exercise or enforcement of any of
the terms hereof or of any rights hereunder or under any other Loan Document or
in connection with any foreclosure, collection or bankruptcy proceedings, and
(b) all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent, in its capacity as such, the Documentation Agent, in its
capacity as such, in any way relating to or arising out of this Agreement or any
other Loan Documents or any action taken or omitted by the Documentation Agent
or the Administrative Agent hereunder or thereunder, PROVIDED that the Borrower
shall not be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
if the same results from the Documentation Agent's or Administrative Agent's
gross negligence or willful misconduct, or if the Borrower was not given notice
of the subject claim and the opportunity to participate in the defense thereof,
at its expense (except that the Borrower shall remain liable to the extent such
failure to give notice does not result in a loss to the Borrower), or if the
same results from a compromise or settlement agreement entered into without the
consent of the Borrower, which shall not be unreasonably withheld. In addition,
the Borrower agrees to reimburse and pay all reasonable out-of-pocket expenses
of the Administrative Agent's regular employees and agents engaged to perform
audits of the Loan Parties' books, records and business properties.
9.6 EXCULPATORY PROVISIONS.
None of the Documentation Agent, the Administrative Agent, any Managing
Agent, the Syndication Agent or any Issuing Letter of Credit Bank or any of
their respective directors, officers, employees, agents, attorneys or Affiliates
shall (a) be liable to any Bank for any action taken or omitted to be taken by
it or them hereunder, or in connection herewith including pursuant to any Loan
Document, unless caused by its or its respective directors, officers, employees,
agents, attorneys or Affiliates own gross negligence or willful misconduct, (b)
be responsible in any manner to any of the Banks for the effectiveness,
enforceability, genuineness, validity or due execution of this Agreement or any
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other Loan Documents or for any recital, representation, warranty, document,
certificate, report or statement herein or made or furnished under or in
connection with this Agreement or any other Loan Documents, or (c) be under any
obligation to any of the Banks to ascertain or to inquire as to the performance
or observance of any of the terms, covenants or conditions hereof or thereof on
the part of the Loan Parties, or the financial condition of the Loan Parties, or
the existence or possible existence of any Event of Default or Potential
Default. None of the Documentation Agent, the Administrative Agent, any Managing
Agent, the Syndication Agent or Issuing Letter of Credit Bank or any Bank or any
of their respective directors, officers, employees, agents, attorneys or
Affiliates shall be liable to any of the Loan Parties for consequential damages
resulting from any breach of contract, tort or other wrong in connection with
the negotiation, documentation, administration or collection of the Loans or any
of the Loan Documents.
9.7 REIMBURSEMENT AND INDEMNIFICATION BY BANKS OF THE
DOCUMENTATION AGENT, THE MANAGING AGENTS, THE SYNDICATION AGENT AND THE
ADMINISTRATIVE AGENT.
Each Bank agrees to reimburse and indemnify the Documentation Agent,
the Administrative Agent, any Managing Agent, the Syndication Agent and any
Issuing Letter of Credit Bank (to the extent not reimbursed by the Borrower and
without limiting the Obligation of the Borrower to do so) in proportion to its
Ratable Share from and against all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by or asserted
against the Documentation Agent, the Administrative Agent, any Managing Agent,
the Syndication Agent or any Issuing Letter of Credit Bank in its capacity as
such, in any way relating to or arising out of this Agreement or any other Loan
Documents or any action taken or omitted by the Documentation Agent, the
Administrative Agent, a Managing Agent, the Syndication Agent or any Issuing
Letter of Credit Bank hereunder or thereunder, PROVIDED that no Bank shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements (a) if
the same results from the Documentation Agent's, Administrative Agent's, any
Managing Agent's, the Syndication Agent's or any Issuing Letter of Credit Bank's
gross negligence or willful misconduct, or (b) if such Bank was not given notice
of the subject claim and the opportunity to participate in the defense thereof,
at its expense (except that such Bank shall remain liable to the extent such
failure to give notice does not result in a loss to the Bank), or (c) if the
same results from a compromise and settlement agreement entered into without the
consent of such Bank, which shall not be unreasonably withheld. In addition,
each Bank agrees promptly upon demand to reimburse the Administrative Agent (to
the extent not reimbursed by the Borrower and without limiting the Obligation of
the Borrower to do so) in proportion to its Ratable Share for all amounts due
and payable by the Borrower to the Administrative Agent in connection with the
Administrative Agent's periodic audit of the Loan Parties' books, records and
business properties.
9.8 RELIANCE BY DOCUMENTATION AGENT, ADMINISTRATIVE AGENT,
MANAGING AGENTS AND SYNDICATION AGENT.
The Documentation Agent, the Administrative Agent, the Managing Agents,
the Syndication Agent and the Issuing Letter of Credit Banks shall be entitled
to rely upon any writing, telegram, telex or teletype message, resolution,
notice, consent, certificate, letter, cablegram, statement, order or other
document or conversation by telephone or otherwise believed by it to be genuine
and correct and to have been signed, sent or made by the proper Person or
Persons, and upon the advice and opinions of counsel and other professional
advisers selected by the Administrative Agent. The Documentation Agent, the
Administrative Agent, the Managing Agents, the Syndication Agent and the Issuing
Letter of Credit Banks shall be fully justified in failing or refusing to take
any action hereunder unless it shall first be indemnified to its satisfaction by
the Banks against any and all liability and expense (other than a liability or
ex-
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pense relating to gross negligence or willful misconduct) which may be
incurred by it by reason of taking or continuing to take any such action.
9.9 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Potential Default or Event of Default unless the
Administrative Agent has received written notice from a Revolving Credit Bank or
the Borrower referring to this Agreement, describing such Potential Default or
Event of Default and stating that such notice is a "notice of default."
9.10 NOTICES.
The Administrative Agent and the Documentation Agent shall promptly
send to each Revolving Credit Bank a copy of all notices and other documents
received from the Borrower pursuant to the provisions of this Agreement or the
other Loan Documents promptly upon receipt thereof. The Administrative Agent
shall promptly notify the Borrower and the other Revolving Credit Banks of each
change in the Base Rate and the effective date thereof.
9.11 BANKS IN THEIR INDIVIDUAL CAPACITIES.
With respect to their Revolving Credit Commitments and the Loans made
by them, the Documentation Agent and the Administrative Agent shall have the
same rights and powers hereunder as any other Revolving Credit Bank and may
exercise the same as though it were not the Documentation Agent or the
Administrative Agent, and the term "Revolving Credit Banks" shall, unless the
context otherwise indicates, include the Documentation Agent and the
Administrative Agent in their individual capacity. The Documentation Agent and
its Affiliates, the Administrative Agent and its Affiliates and each of the
Banks and their respective Affiliates may, without liability to account, except
as prohibited herein, make loans to, accept deposits from, discount drafts for,
act as trustee under indentures of, and generally engage in any kind of banking
or trust business with, the Loan Parties and their Affiliates, in the case of
the Documentation Agent, as though it were not acting as Documentation Agent
hereunder and in the case of each Bank, as though such Bank were not a Bank
hereunder.
9.12 HOLDERS OF NOTES.
The Administrative Agent may deem and treat any payee of any Note as
the owner thereof for all purposes hereof unless and until written notice of the
assignment or transfer thereof shall have been filed with the Administrative
Agent. Any request, authority or consent of any Person who at the time of making
such request or giving such authority or consent is the holder of any Note shall
be conclusive and binding on any subsequent holder, transferee or assignee of
such Note or of any Note or Notes issued in exchange therefor.
9.13 EQUALIZATION OF BANKS.
The Banks and the holders of any participations in any Revolving Credit
Notes agree among themselves that, with respect to all amounts received by any
Bank or any such holder for application on any Obligation hereunder or under any
Revolving Credit Note or under any such participation, whether received by
voluntary payment, by realization upon security, by the exercise of the right of
set-off or banker's lien, by counterclaim or by any other non-pro rata source,
equitable adjustment will be made in the manner stated in the following sentence
so that, in effect, all such ex-
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cess amounts will be shared ratably among the Banks and such holders in
proportion to their interests in payments under the Revolving Credit Notes,
except as otherwise provided in Sections 3.4.2 or 4.5.1. The Banks or any such
holder receiving any such amount shall purchase for cash from each of the other
Banks an interest in such Bank's Revolving Credit Loans in such amount as shall
result in a ratable participation by the Banks and each such holder in the
aggregate unpaid amount under the Revolving Credit Notes, PROVIDED that if all
or any portion of such excess amount is thereafter recovered from the Bank or
the holder making such purchase, such purchase shall be rescinded and the
purchase price restored to the extent of such recovery, together with interest
or other amounts, if any, required by law (including court order) to be paid by
the Bank or the holder making such purchase.
9.14 SUCCESSOR ADMINISTRATIVE AND DOCUMENTATION AGENTS.
The Administrative Agent (i) may resign as Administrative Agent or (ii)
shall resign if such resignation is requested by the Required Banks (if the
Administrative Agent is a Revolving Credit Bank, the Administrative Agent's
Loans and its Revolving Credit Commitment shall be considered in determining
whether the Required Banks have requested such resignation), in either case of
(i) or (ii) by giving not less than thirty (30) days' prior written notice to
the Borrower. The Documentation Agent may resign as Documentation Agent. If the
Administrative Agent or Documentation Agent shall resign under this Agreement,
then subject to the consent of the Borrower (which consent shall not be
unreasonably withheld and which consent shall not be required during any period
in which an Event of Default exists) either (a) the Required Banks shall appoint
from among the Revolving Credit Banks a successor administrative agent or
documentation agent for the Revolving Credit Banks, or (b) if a successor agent
shall not be so appointed and approved within the thirty (30) day period
following the Administrative Agent's notice or the Documentation Agent's notice
to the Revolving Credit Banks of its resignation, then the Administrative Agent
or the Documentation Agent, as the case may be, shall appoint a successor
administrative agent or documentation agent, as the case may be, who shall serve
as Administrative Agent or Documentation Agent until such time as the Required
Banks appoint a successor administrative agent or documentation agent. Upon its
appointment, such successor administrative agent or documentation agent shall
succeed to the rights, powers and duties of the Administrative Agent or the
Documentation Agent, as the case may be, and the term "Administrative Agent" or
"Documentation Agent" shall mean such successor effective upon its appointment,
and the former Administrative Agent's or Documentation Agent's rights, powers
and duties as Administrative Agent or Documentation Agent, as the case may be,
shall be terminated without any other or further act or deed on the part of such
former Administrative Agent or Documentation Agent or any of the parties to this
Agreement. After the resignation of any Administrative Agent or Documentation
Agent hereunder, the provisions of this Article shall inure to the benefit of
such former Administrative Agent or Documentation Agent and such former
Administrative Agent or Documentation Agent shall not by reason of such
resignation be deemed to be released from liability for any actions taken or not
taken by it while it was an Administrative Agent or Documentation Agent under
this Agreement.
9.15 OTHER FEES.
The Borrower shall pay to the Administrative Agent, at the times set
forth in such letter, the bid loan processing fee and administrative fees due
pursuant to that certain commitment letter dated March 25, 1996, among the
Borrower and the various Agents and that certain letter agreement between
Borrower and the Administrative Agent dated March 21, 1997, and each as later
amended.
9.16 AVAILABILITY OF FUNDS.
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Unless the Administrative Agent shall have been notified by a Bank
prior to the date upon which a Loan is to be made that such Bank does not intend
to make available to the Administrative Agent such Bank's portion of such Loan,
the Administrative Agent may assume that such Bank has made or will make such
proceeds available to the Administrative Agent on such date and the
Administrative Agent may, in reliance upon such assumption (but shall not be
required to), make available to the Borrower a corresponding amount. If such
corresponding amount is not in fact made available to the Administrative Agent
by such Bank, the Administrative Agent shall be entitled to recover such amount
on demand from such Bank (or, if such Bank fails to pay such amount forthwith
upon such demand from the Borrower) together with interest thereon, in respect
of each day during the period commencing on the date such amount was made
available to the Borrower and ending on the date the Administrative Agent
recovers such amount, at a rate per annum equal to the Federal Funds Effective
Rate.
9.17 CALCULATIONS.
In the absence of gross negligence or willful misconduct, the
Administrative Agent shall not be liable for any error in computing the amount
payable to any Bank whether in respect of the Loans, fees or any other amounts
due to the Banks under this Agreement. In the event an error in computing any
amount payable to any Bank is made, the Administrative Agent, the Borrower and
each affected Bank shall, forthwith upon discovery of such error, make such
adjustments as shall be required to correct such error, and any compensation
therefor will be calculated at the Federal Funds Effective Rate.
9.18 BENEFICIARIES.
Except as expressly provided herein, the provisions of this Article are
solely for the benefit of the Documentation Agent, the Administrative Agent, the
Managing Agents, the Syndication Agent and the Banks, and the Loan Parties shall
not have any rights to rely on or enforce any of the provisions hereof. In
performing its functions and duties under this Agreement, the Administrative
Agent shall act solely as agent of the Banks and does not assume and shall not
be deemed to have assumed any obligation toward or relationship of agency or
trust with or for any of the Loan Parties.
9.19 ABSENCE OF DUTIES OF MANAGING AGENTS AND SYNDICATION AGENT.
The Managing Agents and the Syndication Agent shall have no obligations
or duties under this Agreement.
10. MISCELLANEOUS
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10.1 MODIFICATIONS, AMENDMENTS OR WAIVERS.
With the written consent of the Required Banks, the Administrative
Agent, acting on behalf of all the Banks, and the Borrower, on behalf of the
Loan Parties, may from time to time enter into written agreements amending or
changing any provision of this Agreement or any other Loan Document or the
rights of the Banks or the Loan Parties hereunder or thereunder, or may grant
written waivers or consents to a departure from the due performance of the
Obligations of the Loan Parties hereunder or thereunder; provided, however, that
the written consent of the Required Banks shall not be required with respect to
the joinder of additional Loan Parties pursuant to Section 10.18 Any such
agreement, waiver or consent made with such written consent shall be effective
to bind all the Banks and the Loan
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Parties; PROVIDED, that, without the written consent of all the Banks, no such
agreement, waiver or consent may be made which will:
10.1.1 INCREASE OF REVOLVING CREDIT COMMITMENT; EXTENSION OR
EXPIRATION DATE.
Increase the amount of the Revolving Credit Commitment of any Bank
hereunder or extend the Expiration Date;
10.1.2 EXTENSION OF PAYMENT; REDUCTION OF PRINCIPAL INTEREST
OR FEES; MODIFICATION OF TERMS OF PAYMENT.
Whether or not any Loans are outstanding, extend the time for payment
of principal or interest of any Loan, the Facility Fee or any other fee payable
to any Bank, or reduce the principal amount of or the rate of interest borne by
any Loan or reduce the Facility Fee or any other fee payable to any Bank, or
otherwise affect the terms of payment of the principal of or interest of any
Loan, the Facility Fee or any other fee payable to any Bank;
10.1.3 RELEASE OF GUARANTOR.
Release the Company or any Material Subsidiary from its Obligations
under the Master Guaranty Agreement or any other security for any of the Loan
Parties' Obligations; or
10.1.4 MISCELLANEOUS
Amend Sections 4.2 [Pro Rata Treatment of Banks], 9.6 [Exculpatory
Provisions] or 9.13 [Equalization of Banks] or this Section 10.1, alter any
provision regarding the pro rata treatment of the Banks, change the definition
of Required Banks, or change any requirement providing for the Banks or the
Required Banks to authorize the taking of any action hereunder.
No agreement, waiver or consent which would modify the interests,
rights or obligations of the Documentation Agent in its capacity as
Documentation Agent, of the Administrative Agent in its capacity as
Administrative Agent or of an Issuing Letter of Credit Bank in its capacity as
the issuer of Letters of Credit shall be effective without the written consent
of the Documentation Agent, the Administrative Agent or such Issuing Letter of
Credit Bank, respectively.
10.2 NO IMPLIED WAIVERS; CUMULATIVE REMEDIES; WRITING REQUIRED.
No course of dealing and no delay or failure of the Documentation
Agent, the Administrative Agent or any Bank in exercising any right, power,
remedy or privilege under this Agreement or any other Loan Document shall affect
any other or future exercise thereof or operate as a waiver thereof, nor shall
any single or partial exercise thereof or any abandonment or discontinuance of
steps to enforce such a right, power, remedy or privilege preclude any further
exercise thereof or of any other right, power, remedy or privilege. The rights
and remedies of the Documentation Agent, the Administrative Agent, the
Syndication Agent, the Managing Agents, the Issuing Letter of Credit Banks and
the Banks under this Agreement and any other Loan Documents are cumulative and
not exclusive of any rights or remedies which they would otherwise have. Any
waiver, permit, consent or approval of any kind or character on the
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part of any Bank of any breach or default under this Agreement or any such
waiver of any provision or condition of this Agreement must be in writing and
shall be effective only to the extent specifically set forth in such writing.
10.3 REIMBURSEMENT AND INDEMNIFICATION OF BANKS BY THE BORROWER;
TAXES.
The Borrower agrees unconditionally upon demand to pay or reimburse to
each Bank (other than the Administrative Agent and the Documentation Agent, as
to which the Borrower's Obligations are set forth in Section 9.5) and to save
such Bank harmless against (i) liability for the payment of all reasonable
out-of-pocket costs, expenses and disbursements (including fees and expenses of
counsel for each Bank except with respect to (a) and (b) below), incurred by
such Bank (a) in connection with the administration and interpretation of this
Agreement, and other instruments and documents to be delivered hereunder, (b)
relating to any amendments, waivers or consents pursuant to the provisions
hereof,(c) in connection with the enforcement of this Agreement or any other
Loan Document, or collection of amounts due hereunder or thereunder or the proof
and allowability of any claim arising under this Agreement or any other Loan
Document, whether in bankruptcy or receivership proceedings or otherwise, and
(d) in any workout or restructuring or in connection with the protection,
preservation, exercise or enforcement of any of the terms hereof or of any
rights hereunder or under any other Loan Document or in connection with any
foreclosure, collection or bankruptcy proceedings, or (ii) all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by or asserted against such Bank, in its capacity as such, in any
way relating to or arising out of this Agreement (including without limitation
Section 4.5.2) or any other Loan Documents or any action taken or omitted by
such Bank hereunder or thereunder, PROVIDED that the Borrower shall not be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements (A) if
the same results from such Bank's gross negligence or willful misconduct, or (B)
if the Borrower was not given notice of the subject claim and the opportunity to
participate in the defense thereof, at its expense (except that the Borrower
shall remain liable to the extent such failure to give notice does not result in
a loss to the Borrower), or (C) if the same results from a compromise or
settlement agreement entered into without the consent of the Borrower, which
shall not be unreasonably withheld. The Banks will attempt to minimize the fees
and expenses of legal counsel for the Banks which are subject to reimbursement
by the Borrower hereunder by considering the usage of one law firm to represent
the Banks and the Administrative Agent if appropriate under the circumstances.
The Borrower agrees unconditionally to pay all stamp, documentary, transfer,
recording or filing taxes or fees and similar impositions now or hereafter
determined by the Administrative Agent or any Bank to be payable in connection
with this Agreement or any other Loan Document, and the Borrower agrees
unconditionally to save the Administrative Agent and the Banks 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.
10.4 HOLIDAYS.
Whenever any payment or action to be made or taken hereunder shall be
stated to be due on a day which is not a Business Day, such payment or action
shall be made or taken on the next following Business Day (except as provided in
Section 3.2.1 with respect to Interest Periods under the Revolving Credit
Euro-Rate Option), and such extension of time shall be included in computing
interest or fees, if any, in connection with such payment or action.
10.5 FUNDING BY BRANCH, SUBSIDIARY OR AFFILIATE.
10.5.1 NOTIONAL FUNDING.
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Each Bank shall have the right from time to time, without notice to the
Borrower, to deem any branch, Subsidiary or Affiliate (which for the purposes of
this Section 10.5 shall mean any corporation or association which is directly or
indirectly controlled by or is under direct or indirect common control with any
corporation or association which directly or indirectly controls such Bank) of
such Bank to have made, maintained or funded any Loan to which the Revolving
Credit Euro-Rate Option applies at any time, PROVIDED that immediately following
(on the assumption that a payment were then due from the Borrower to such other
office), and as a result of such change, the Borrower would not be under any
greater financial obligation pursuant to Section 4.5 than it would have been in
the absence of such change. Notional funding offices may be selected by each
Bank without regard to such Bank's actual methods of making, maintaining or
funding the Loans or any sources of funding actually used by or available to
such Bank; and
10.5.2 ACTUAL FUNDING.
Each Bank shall have the right from time to time to make or maintain
any Loan by arranging for a branch, Subsidiary or Affiliate of such Bank to make
or maintain such Loan subject to the last sentence of this Section 10.5.2. If
any Bank causes a branch, Subsidiary or Affiliate to make or maintain any part
of the Loans hereunder, all terms and conditions of this Agreement shall, except
where the context clearly requires otherwise, be applicable to such part of the
Loans to the same extent as if such Loans were made or maintained by such Bank,
but in no event shall any Bank's use of such a branch, Subsidiary or Affiliate
to make or maintain any part of the Loans hereunder cause such Bank or such
branch, Subsidiary or Affiliate to incur any cost or expenses payable by the
Borrower hereunder or require the Borrower to pay any other compensation to any
Bank (including any expenses incurred or payable pursuant to Section 4.5) which
would otherwise not be incurred.
10.6 NOTICES.
All notices, requests, demands, directions and other communications (as
used in this Section 10.6, collectively referred to as "notices") given to or
made upon any party hereto under the provisions of this Agreement shall be by
telephone or in writing (including telex or facsimile communication) unless
otherwise expressly permitted hereunder and shall be delivered or sent by telex
or facsimile to the respective parties at the addresses and numbers set forth
under their respective names on the signature pages hereof or in accordance with
any subsequent unrevoked written direction from any party to the others. All
notices shall, except as otherwise expressly herein provided, be effective (a)
in the case of telex or facsimile, when received, (b) in the case of
hand-delivered notice, when hand-delivered, (c) in the case of telephone, when
telephoned, PROVIDED, however, that in order to be effective, telephonic notices
must be confirmed in writing no later than the next day by letter, facsimile or
telex, (d) if given by mail, four (4) days after such communication is deposited
in the mail with first-class postage prepaid, return receipt requested, and (e)
if given by any other means (including by air courier), when delivered;
PROVIDED, that notices to the Administrative Agent shall not be effective until
received. Any Bank giving any notice to any Loan Party shall simultaneously send
a copy thereof to the Administrative Agent, and the Administrative Agent shall
promptly notify the other Banks of the receipt by it of any such notice. Each
Designated Lender appoints its Designating Bank as its agent for the purpose of
delivering and receiving all notices hereunder as more fully set forth in
Section 10.11.3 and in its Designation Agreement with such Designating Bank.
10.7 SEVERABILITY.
The provisions of this Agreement are intended to be severable. If any
provision of this Agreement shall be held invalid or unenforceable in whole or
in part in any jurisdiction, such provision shall, as to such jurisdiction, be
inef-
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fective to the extent of such invalidity or unenforceability without in any
manner affecting the validity or enforceability thereof in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.
10.8 GOVERNING LAW.
Each Letter of Credit and Section 2.9 shall be subject to the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500, as the same may be revised or amended
from time to time, and to the extent not inconsistent therewith, the internal
laws of the New York without regard to its conflict of laws principles and the
balance of this Agreement shall be deemed to be a contract under the Laws of the
Ohio and for all purposes shall be governed by and construed and enforced in
accordance with the internal laws of the State of Ohio without regard to its
conflict of laws principles.
10.9 PRIOR UNDERSTANDING.
This Agreement and the other documents and instruments executed in
connection herewith supersede all prior understandings and agreements, whether
written or oral, between the parties hereto and thereto relating to the
transactions provided for herein and therein, including any prior
confidentiality agreements and commitments.
10.10 DURATION; SURVIVAL.
All representations and warranties of the Loan Parties contained herein
or made in connection herewith shall survive the making of Loans and issuance of
Letters of Credit and shall not be waived by the execution and delivery of this
Agreement, any investigation by the Administrative Agent, the Documentation
Agent, the Syndication Agent, the Managing Agents, the Issuing Letter of Credit
Banks or the Banks, the making of Loans, issuance of Letters of Credit, or
payment in full of the Loans. All covenants and agreements of the Loan Parties
contained in Sections 7.1, 7.2, and 7.3 shall continue in full force and effect
from and after the date hereof so long as the Borrower may borrow or request
Letters of Credit hereunder and until termination of the Revolving Credit
Commitments, repayment of all Loans and expiration or termination of all Letters
of Credit. All covenants and agreements of the Borrower contained herein
relating to the payment of principal, interest, premiums, additional
compensation or expenses and indemnification, including those set forth in the
Notes, Article 4 and Sections 9.5, 9.7 and 10.3, shall survive payment in full
of the Loans, expiration or termination of the Letters of Credit and termination
of the Revolving Credit Commitments.
10.11 SUCCESSORS AND ASSIGNS.
10.11.1 BINDING EFFECT; ASSIGNMENTS BY LOAN PARTIES.
This Agreement shall be binding upon and shall inure to the benefit of
the Banks, the Documentation Agent, the Administrative Agent, the Syndication
Agent, the Managing Agents, the Issuing Letter of Credit Banks, the Loan Parties
and their respective successors and assigns, except that none of the Loan
Parties may assign or transfer any of its rights and Obligations hereunder or
any interest herein without consent of all of the Revolving Credit Banks (each
on its own behalf and on behalf of any Designated Lenders of such Revolving
Credit Bank).
10.11.2 ASSIGNMENTS AND PARTICIPATIONS BY BANKS OTHER THAN
ASSIGNMENTS OF BID LOANS AMONG DESIGNATING BANKS AND DESIGNATED LENDERS.
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This Section shall apply to any assignment or participation by a Bank
of its Loans, Letters of Credit Outstandings or Revolving Credit Commitment
except for assignments or designations of Bid Loans among Designating Banks or
Designated Lenders described in Section 10.11.3. Each Revolving Credit Bank may,
at its own cost, make assignments of all or any part of its Revolving Credit
Commitment and Revolving Credit Loans and Bid Loans and its Ratable Share of
Letter of Credit Outstandings to one or more banks or other entities, subject to
the consent of the Borrower (which consent shall not be required during any
period in which an Event of Default exists), the Issuing Letter of Credit Banks
and the Administrative Agent with respect to any assignee, such consents not to
be unreasonably withheld, and PROVIDED that assignments may not be made in
amounts less than $5,000,000 and a Bank may assign a Bid Loan to another Person
only if either such Bank is a Revolving Credit Bank and is simultaneously
assigning all or a portion of its Revolving Credit Commitment to such Person or
the assignee is already a Revolving Credit Bank hereunder. Each Bank may, at its
own cost, grant participations in all or any part of its Revolving Credit
Commitment and the Revolving Credit Loans and Bid Loans made by it and of its
Ratable Share of Letter of Credit Outstandings to one or more banks or other
entities, without the consent of any party hereto. In the case of an assignment
of all or any portion of a Revolving Credit Commitment, upon receipt by the
Administrative Agent of the Assignment and Assumption Agreement, the assignee
shall have, to the extent of such assignment (unless otherwise provided
therein), the same rights, benefits and obligations as it would have if it had
been a signatory Revolving Credit Bank hereunder, the Revolving Credit
Commitments in Section 2.1 shall be adjusted accordingly, and upon surrender of
any Revolving Credit Note subject to such assignment, the Borrower shall execute
and deliver a new Revolving Credit Note to the assignee in an amount equal to
the amount of the Revolving Credit Commitment assumed by it and a new Revolving
Credit Note to the assigning Revolving Credit Bank in an amount equal to the
Revolving Credit Commitment retained by it hereunder. The assigning Bank shall
surrender its Bid Note if it is assigning all of its Revolving Credit
Commitment. The Borrower shall executed and deliver to the assignee a Bid Note
in the form of EXHIBIT 1.1(B). Any assigning Bank (other than assignments by any
Managing Agent within ninety (90) days after the Closing Date) shall pay to the
Administrative Agent a service fee in the amount of $3,500 for each assignment,
which amount shall not be subject to reimbursement or indemnification by the
Borrower. In the case of a participation, the participant shall only have the
rights specified in Section 8.2.3 (the participant's rights against the selling
Bank in respect of such participation to be those set forth in the agreement
executed by such Bank in favor of the participant relating thereto and not to
include any voting rights except with respect to changes of the type referenced
in Sections 10.1.1, 10.1.2 and 10.1.3), all of such Bank's obligations under
this Agreement or any other Loan Document shall remain unchanged, and all
amounts payable by any Loan Party hereunder or thereunder shall be determined as
if such Bank had not sold such participation. Any assignee or participant which
is not incorporated under the Laws of the United States of America or a state
thereof shall deliver to the Borrower and the Administrative Agent the form of
certificate described in Section 10.17 relating to federal income tax
withholding. Each Bank may furnish any publicly available information concerning
any Loan Party or its Subsidiaries and any other information concerning any Loan
Party or its Subsidiaries in the possession of such Bank from time to time to
assignees and participants (including prospective assignees or participants),
PROVIDED that such assignees and participants agree to be bound by the
provisions of Section 10.12.
10.11.3 ASSIGNMENTS OF BID LOANS AMONG DESIGNATING BANKS AND
DESIGNATED LENDERS.
10.11.3.1 ASSIGNMENTS TO DESIGNATED LENDERS.
Any Revolving Credit Bank (each a "Designating Bank") may at any time,
subject to the consent of the Borrower, which consent shall not be unreasonably
withheld and subject to the terms of this Section 10.11.3.1, designate one or
more Designated Lenders to fund Bid Loans which the Designating Bank is required
to fund. The parties hereto acknowledge and agree that any Designation Agreement
signed by any Bank prior to the Closing Date pursuant to the
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Prior Credit Agreement shall remain in effect after the Closing Date. The
provisions of Section 10.11.2 shall not apply to any designation made under this
Section. No Revolving Credit Bank shall be entitled to make more than two such
designations. The parties to each such designation shall execute and deliver to
the Administrative Agent, for its acceptance, a Designation Agreement. Upon its
receipt of an appropriately completed Designation Agreement executed by a
Designating Bank, a designee representing that it is a Designated Lender and the
Borrower, the Administrative Agent will accept such Designation Agreement. From
and after the later of the date on which the Administrative Agent receives the
executed Designation Agreement and the effective date specified in the
Designation Agreement, the Designated Lender shall become a party to this
Agreement with a right to make any Bid Loan on behalf of its Designating Bank
pursuant to Section 2.11 after the Borrower has accepted a Bid (or a portion
thereof) of the Designating Bank. The Designating Bank shall not be obligated to
designate its Designated Lender to fund any Bid Loan, and such Designated Lender
shall not be obligated to fund any Bid Loan, each such designation being subject
to the agreement of the Designating Bank and its Designated Lender and to be
made at the time that such Bid Loan is made. Each Designating Bank shall serve
as the agent of the Designated Lender for purposes of giving and receiving all
communications and notices and taking all actions hereunder, including without
limitation votes, approvals, waivers, consents and amendments under or relating
to this Agreement or the other Loan Documents. Any such notice, communication,
vote, approval, waiver, consent or amendment shall be signed by the Designating
Bank as agent for the Designated Lender and shall not be signed by the
Designated Lender. The Borrower, the Administrative Agent and the Banks may rely
thereon without any requirement that the Designated Lender sign or acknowledge
the same. Any Designated Lender which is not incorporated under the Laws of the
United States of America or a state thereof shall deliver to the Borrower and
the Administrative Agent the form of certificate described in Section 10.17
relating to federal income tax withholding.
10.11.3.2 ASSIGNMENTS BY DESIGNATED LENDERS.
Any Designated Lender may assign its Bid Loan to its Designating Bank
or to another Designated Lender designated by such Designating Bank and such
assignment shall not be subject to the requirements of Section 10.11.2, provided
that the Designated Lender and Designating Bank shall notify the Administrative
Agent promptly of such assignment.
10.11.4 ASSIGNMENTS BY BANKS TO FEDERAL RESERVE BANKS.
Notwithstanding any other provision in this Agreement, any Bank may at
any time pledge or grant a security interest in all or any portion of its rights
under this Agreement, its Notes and the other Loan Documents to any Federal
Reserve Bank in accordance with Regulation A of the FRB or US Treasury
Regulation 31 CFR Section 203.14 without notice to or consent of the Borrower or
any agent. No such pledge or grant of a security interest shall release the
transferor Bank of its obligations hereunder or under any other Loan Document.
10.12 CONFIDENTIALITY.
The Documentation Agent, the Administrative Agent and the Banks each
agree to keep confidential all information obtained from any Loan Party or its
Subsidiaries which is nonpublic and confidential or proprietary in nature
(including any information the Borrower specifically designates as
confidential), except as provided below, and to use such information only in
connection with their respective capacities under this Agreement and for the
purposes contemplated hereby. The Documentation Agent, the Administrative Agent
and the Banks shall be permitted to disclose such information (i) to outside
legal counsel, accountants and other professional advisors who need to know such
in-
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formation in connection with the administration and enforcement of this
Agreement and who are notified that the information is to be treated as
confidential, (ii) to assignees and participants as contemplated by Section
10.11, (iii) to the extent requested by any bank regulatory authority or, with
notice to the Borrower if not prohibited, as otherwise required by applicable
Law or by any subpoena or similar legal process, or in connection with any
investigation or proceeding arising out of the transactions contemplated by this
Agreement, (iv) if it becomes publicly available other than as a result of a
breach of this Agreement or becomes available from a source not known to be
subject to confidentiality restrictions, (v) if the Borrower shall have
consented to such disclosure, or (vi) after notice to the Borrower unless the
Borrower is an adverse party in such litigation, in connection with any
litigation to which any Bank is a party the subject matter of which involves
this Agreement or is deemed necessary upon the advice of legal counsel of such
Bank by such Bank in any defense of such litigation.
10.13 COUNTERPARTS.
This Agreement may be executed by different parties hereto on any
number of separate counterparts, including facsimiles, each of which, when so
executed and delivered, shall be an original, and all such counterparts shall
together constitute one and the same instrument.
10.14 DOCUMENTATION AGENT'S OR BANK'S CONSENT.
Whenever the Documentation Agent's, the Administrative Agent's any
Managing Agent's, the Syndication Agent's, any Issuing Letter of Credit Bank's
or any Bank's consent is required to be obtained under this Agreement or any of
the other Loan Documents as a condition to any action, inaction, condition or
event, the Documentation Agent, the Administrative Agent each Managing Agent,
the Syndication Agent, each Issuing Letter of Credit Bank and each Bank shall be
authorized to give or withhold such consent in its sole and absolute discretion
and to condition its consent upon the giving of additional collateral, the
payment of money or any other matter.
10.15 EXCEPTIONS.
The representations, warranties and covenants contained herein shall be
independent of each other, and no exception to any representation, warranty or
covenant shall be deemed to be an exception to any other representation,
warranty or covenant contained herein unless expressly provided, nor shall any
such exceptions be deemed to permit any action or omission that would be in
contravention of applicable Law.
10.16 CONSENT TO FORUM; WAIVER OF JURY TRIAL.
EACH LOAN PARTY HEREBY IRREVOCABLY CONSENTS TO THE NONEXCLUSIVE
JURISDICTION OF THE COURT OF COMMON PLEAS OF FRANKLIN COUNTY AND THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO, AND WAIVES PERSONAL
SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF
PROCESS BE MADE BY CERTIFIED OR REGISTERED MAIL DIRECTED TO SUCH LOAN PARTY AT
THE ADDRESSES PROVIDED FOR IN SECTION 10.6 AND SERVICE SO MADE SHALL BE DEEMED
TO BE COMPLETED UPON ACTUAL RECEIPT THEREOF. EACH LOAN PARTY WAIVES ANY
OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED AGAINST IT AS
PROVIDED HEREIN AND AGREES NOT TO ASSERT ANY DEFENSE BASED ON LACK OF
JURISDICTION OR VENUE OR INCONVENIENT FORUM. EACH LOAN PARTY, THE ADMINISTRATIVE
AGENT AND THE BANKS HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING
OR COUNTERCLAIM OF ANY KIND
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ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE
COLLATERAL TO THE FULL EXTENT PERMITTED BY LAW.
10.17 TAX WITHHOLDING CLAUSE.
Each Bank or assignee or participant of a Bank that is not incorporated
under the Laws of the United States of America or a state thereof agrees that it
will deliver to each of the Borrower and the Administrative Agent two (2) duly
completed copies of the following: (i) Internal Revenue Service Form W-9, 4224
or 1001, or other applicable form prescribed by the Internal Revenue Service,
certifying that such Bank, assignee or participant is entitled to receive
payments under this Agreement and the other Loan Documents without deduction or
withholding of any United States federal income taxes, or is subject to such tax
at a reduced rate under an applicable tax treaty, or (ii) Internal Revenue
Service Form W-8 or other applicable form or a certificate of such Bank,
assignee or participant indicating that no such exemption or reduced rate is
allowable with respect to such payments. Each Bank, assignee or participant
required to deliver to the Borrower and the Documentation Agent a form or
certificate pursuant to the preceding sentence shall deliver such form or
certificate as follows: (A) each Bank which is a party hereto on the Closing
Date shall deliver such form or certificate at least five (5) Business Days
prior to the first date on which any interest or fees are payable by the
Borrower hereunder for the account of such Bank; (B) each assignee or
participant shall deliver such form or certificate at least five (5) Business
Days before the effective date of such assignment or participation (unless the
Documentation Agent in its sole discretion shall permit such assignee or
participant to deliver such form or certificate less than five (5) Business Days
before such date in which case it shall be due on the date specified by the
Documentation Agent). Each Bank, assignee or participant which so delivers a
Form W-8, W-9, 4224 or 1001 further undertakes to deliver to each of the
Borrower and the Documentation Agent two (2) additional copies of such form (or
a successor form) on or before the date that such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent form so delivered by it, and such amendments thereto or extensions or
renewals thereof as may be reasonably requested by the Borrower or the
Documentation Agent, either certifying that such Bank, assignee or participant
is entitled to receive payments under this Agreement and the other Loan
Documents without deduction or withholding of any United States federal income
taxes or is subject to such tax at a reduced rate under an applicable tax treaty
or stating that no such exemption or reduced rate is allowable. The
Documentation Agent shall be entitled to withhold United States federal income
taxes at the full withholding rate unless the Bank, assignee or participant
establishes an exemption or that it is subject to a reduced rate as established
pursuant to the above provisions.
10.18 JOINDER OF GUARANTORS.
Any Subsidiary of the Borrower which is required to join the Master
Guaranty Agreement pursuant to Section 7.2.9 shall execute and deliver to the
Documentation Agent a signature page to the Master Guaranty Agreement and to the
Master Intercompany Subordination Agreement. The Loan Parties shall deliver such
Guarantor Joinder to the Documentation Agent within five (5) Business Days after
the date of the filing of such Subsidiary's articles of incorporation if the
Subsidiary is a corporation, the date of the filing of its certificate of
limited partnership if it is a limited partnership or the date of its
organization if it is an entity other than a limited partnership or corporation
or, if acquired, the date of acquisition.
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[SIGNATURE PAGE 1 OF 4 TO CREDIT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed this Agreement as of the day and year first above
written.
BORROWER:
CONSOLIDATED STORES CORPORATION
By:____________________________________________
Title:_________________________________________
ADMINISTRATIVE AGENT:
NATIONAL CITY BANK, as Administrative Agent, as a
Managing Agent and as a Bank
By:____________________________________________
Title:_________________________________________
OTHER MANAGING AGENTS:
THE BANK OF NEW YORK, as Syndication Agent, as a
Managing Agent and as a Bank
By:____________________________________________
Title:_________________________________________
BANK ONE, N.A., as Co-Syndication Agent, as a
Managing Agent and as a Bank
By:____________________________________________
Title:_________________________________________
BANK OF AMERICA NT & SA, as a Managing Agent and
as a Bank
By:____________________________________________
Title:_________________________________________
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[SIGNATURE PAGE 2 OF 4 TO CREDIT AGREEMENT]
FIRST UNION NATIONAL BANK , as a Managing Agent
and as a Bank
By:___________________________________________
Title:________________________________________
FLEET NATIONAL BANK, as a Managing Agent and as
a Bank
By:___________________________________________
Title:________________________________________
NATIONSBANK, N.A., as a Managing Agent and as
a Bank
By:___________________________________________
Title:________________________________________
PNC BANK, NATIONAL ASSOCIATION, as Documentation
Agent, as a Managing Agent and as a Bank
By:___________________________________________
Title:________________________________________
CO-AGENTS:
BANK OF TOKYO - MITSUBISHI TRUST COMPANY, as a
Co-Agent and as a Bank
By:___________________________________________
Title:________________________________________
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[SIGNATURE PAGE 3 OF 4 TO CREDIT AGREEMENT]
KEYBANK NATIONAL ASSOCIATION, as a Co-Agent and
as a Bank
By:________________________________________
Title:_____________________________________
OTHER BANKS:
ABN AMRO BANK N.V.
By: ABN AMRO NORTH AMERICA, INC., its Agent
By:________________________________________
Title:_____________________________________
By:________________________________________
Title:_____________________________________
BANKBOSTON, N.A.
By:________________________________________
Title:_____________________________________
COMERICA BANK
By:________________________________________
Title:_____________________________________
THE FIFTH THIRD BANK OF COLUMBUS
By:________________________________________
Title:_____________________________________
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[SIGNATURE PAGE 4 OF 4 TO CREDIT AGREEMENT]
FIRST HAWAIIAN BANK
By:_______________________________________
Title:____________________________________
MARINE MIDLAND BANK
By:______________________________________
Title:___________________________________
MERCANTILE BANK, NATIONAL ASSOCIATION
By:______________________________________
Title:___________________________________
STAR BANK, N.A.
By:______________________________________
Title:___________________________________
WACHOVIA BANK OF GEORGIA, N.A.
By:______________________________________
Title:___________________________________
▇▇▇▇▇ FARGO BANK, N.A.
By:_______________________________________
Title:____________________________________
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