EXHIBIT 10.5
CREDIT AGREEMENT
Dated as of December 10, 1998
among
JUST FOR FEET, INC.,
as Borrower,
Certain Subsidiaries and Affiliates,
as Guarantors,
THE LENDERS NAMED HEREIN,
COMPASS BANK,
as Documentation Agent,
FIRST UNION NATIONAL BANK,
MARINE MIDLAND BANK,
SOUTHTRUST BANK, N.A.
and
SUNTRUST BANK, ATLANTA,
as Co-Agents,
AND
NATIONSBANK, N.A.,
as Administrative Agent
TABLE OF CONTENTS
SECTION 1 DEFINITIONS.....................................................
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1.1 Definitions.....................................................
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1.2 Computation of Time Periods.....................................
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1.3 Accounting Terms................................................
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SECTION 2 CREDIT FACILITIES...............................................
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2.1 Revolving Loans.................................................
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2.2 Letter of Credit Subfacility....................................
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2.3 Swingline Loan Subfacility......................................
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SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES..................
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3.1 Default Rate....................................................
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3.2 Extension and Conversion........................................
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3.3 Prepayments.....................................................
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3.4 Termination and Reduction of Commitments........................
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3.5 Fees............................................................
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3.6 Capital Adequacy................................................
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3.7 Inability To Determine Interest Rate............................
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3.8 Illegality......................................................
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3.9 Requirements of Law.............................................
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3.10 Taxes...........................................................
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3.11 Indemnity.......................................................
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3.12 Pro Rata Treatment..............................................
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3.13 Sharing of Payments.............................................
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3.14 Payments, Computations, Etc.....................................
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3.15 Evidence of Debt................................................
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3.16 Replacement of Lenders..........................................
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SECTION 4 GUARANTY........................................................
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4.1 The Guarantee...................................................
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4.2 Obligations Unconditional.......................................
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4.3 Reinstatement...................................................
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4.4 Certain Additional Waivers......................................
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4.5 Remedies........................................................
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4.6 Rights of Contribution..........................................
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4.7 Continuing Guarantee............................................
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SECTION 5 CONDITIONS......................................................
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5.1 Conditions to Closing...........................................
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5.2 Conditions to All Extensions of Credit..........................
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SECTION 6 REPRESENTATIONS AND WARRANTIES..................................
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6.1 Financial Condition.............................................
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6.2 No Changes or Restricted Payments...............................
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6.3 Organization; Existence; Compliance with Law....................
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6.4 Power; Authorization; Enforceable Obligations...................
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6.5 No Legal Bar....................................................
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6.6 No Material Litigation..........................................
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6.7 No Default......................................................
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6.8 Ownership of Property; Liens....................................
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6.9 Intellectual Property...........................................
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6.10 Taxes...........................................................
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6.11 ERISA...........................................................
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6.12 Governmental Regulations, Etc...................................
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6.13 Subsidiaries....................................................
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6.14 Purpose of Extensions of Credit.................................
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6.15 Environmental Matters...........................................
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6.16 Year 2000 Compliance............................................
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SECTION 7 AFFIRMATIVE COVENANTS...........................................
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7.1 Financial Statements............................................
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7.2 Certificates; Other Information.................................
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7.3 Notices.........................................................
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7.4 Payment of Obligations..........................................
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7.5 Conduct of Business and Maintenance of Existence................
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7.6 Maintenance of Property; Insurance..............................
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7.7 Inspection of Property; Books and Records; Discussions..........
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7.8 Environmental Laws..............................................
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7.9 Financial Covenants.............................................
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7.10 Administrative Fees.............................................
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7.11 Additional Guaranties and Stock Pledges.........................
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7.12 Ownership of Subsidiaries.......................................
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7.13 Use of Proceeds.................................................
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7.14 Year 2000 Compatibility.........................................
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SECTION 8 NEGATIVE COVENANTS..............................................
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8.1 Indebtedness....................................................
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8.2 Liens...........................................................
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8.3 Consolidation, Merger, Sale or Purchase of Assets, etc..........
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8.4 Advances, Investments and Loans.................................
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8.5 Transactions with Affiliates....................................
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8.6 Ownership of Equity Interests...................................
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8.7 Fiscal Year.....................................................
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8.8 Prepayments of Indebtedness, etc................................
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8.9 Restricted Payments.............................................
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8.10 Sale Leasebacks.................................................
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8.11 Limitations on Restricted Actions...............................
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8.12 No Further Negative Pledges.....................................
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SECTION 9 EVENTS OF DEFAULT...............................................
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9.1 Events of Default...............................................
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9.2 Acceleration; Remedies..........................................
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SECTION 10 AGENCY PROVISIONS..............................................
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10.1 Appointment....................................................
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10.2 Delegation of Duties...........................................
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10.3 Exculpatory Provisions.........................................
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10.4 Reliance on Communications.....................................
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10.5 Notice of Default..............................................
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10.6 Non-Reliance on Administrative Agent and Other Lenders.........
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10.7 Indemnification................................................
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10.8 Administrative Agent in its Individual Capacity................
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10.9 Successor Administrative Agent.................................
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SECTION 11 MISCELLANEOUS..................................................
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11.1 Notices........................................................
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11.2 Right of Set-Off...............................................
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11.3 Benefit of Agreement...........................................
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11.4 No Waiver; Remedies Cumulative.................................
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11.5 Payment of Expenses, etc.......................................
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11.6 Amendments, Waivers and Consents...............................
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11.7 Counterparts...................................................
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11.8 Headings.......................................................
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11.9 Survival.......................................................
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11.10 Governing Law; Submission to Jurisdiction; Venue...............
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11.11 Severability...................................................
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11.12 Entirety.......................................................
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11.13 Binding Effect; Termination....................................
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11.14 Confidentiality................................................
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11.15 Source of Funds................................................
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11.16 Conflict.......................................................
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SCHEDULES
Schedule 2.1(a) Lenders and Commitments
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 2.2(b)-1 Existing Letters of Credit
Schedule 2.2(b)-2 Form of Notice of Request for Standby Letter of Credit
Schedule 2.2(b)-3 Form of Notice of Request for Trade Letter of Credit
Schedule 3.2 Form of Notice of Extension/Conversion
Schedule 5.1(e)(v) Form of Officer's Certificate
Schedule 6.6 Description of Legal Proceedings
Schedule 6.8 Existing Liens
Schedule 6.13 Subsidiaries
Schedule 7.2 Form of Officer's Compliance Certificate
Schedule 7.11 Form of Joinder Agreement
Schedule 8.1 Indebtedness
Schedule 8.4 Existing Investments
Schedule 8.5 Existing Agreements with Affiliates
Schedule 11.1 Lenders and Addresses
Schedule 11.3(b) Form of Assignment and Acceptance
CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of December 10, 1998 (the "Credit
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Agreement"), is by and among JUST FOR FEET, INC., a Delaware corporation (the
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"Borrower"), the subsidiaries and affiliates of the Borrower identified on the
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signature pages hereto and such other subsidiaries and affiliates of the
Borrower as may from time to time become Guarantors hereunder in accordance with
the provisions hereof (the "Guarantors"), the lenders named herein and such
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other lenders as may become a party hereto (the "Lenders"), COMPASS BANK, as
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Documentation Agent, FIRST UNION NATIONAL BANK, MARINE MIDLAND BANK, SOUTHTRUST
BANK, N.A. and SUNTRUST BANK, ATLANTA, as Co-Agents, and NATIONSBANK, N.A., as
Administrative Agent (in such capacity, the "Administrative Agent").
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W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide a $200 million
credit facility for the purposes hereinafter set forth;
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower on the terms and conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
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1.1 Definitions.
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As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Additional Credit Party" means each Person that becomes a Guarantor
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after the Closing Date by execution of a Joinder Agreement.
"Administrative Agent" shall have the meaning assigned to such term in
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the heading hereof, together with any successors or assigns.
"Administrative Agent's Fee Letter" means that certain letter
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agreement, dated as of October 6, 1998, between the Administrative Agent
and the Borrower, as
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amended, modified, supplemented or replaced from time to time.
"Administrative Agent's Fees" shall have the meaning assigned to such
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term in Section 3.5(c).
"Affiliate" means, with respect to any Person, any other Person (i)
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directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person or (ii) directly or indirectly
owning or holding five percent (5%) or more of the equity interest in such
Person. For purposes of this definition, "control" when used with respect
to any Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. Notwithstanding
the foregoing, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (and members of his immediate family,
including any trust for the benefit of any member of his immediate family)
shall not be deemed an Affiliate of the Borrower.
"Agency Services Address" means NationsBank, N.A., NC1-001-15-04, 101
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▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: Agency
Services, or such other address as may be identified by written notice from
the Administrative Agent to the Borrower.
"Aggregate Revolving Committed Amount" means the aggregate amount of
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Revolving Commitments in effect from time to time, being initially TWO
HUNDRED MILLION DOLLARS ($200,000,000).
"Anniversary Date" shall have the meaning assigned to such term in
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Section 2.1(g).
"Applicable Percentage" means for any day, the rate per annum set
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forth below opposite the applicable Consolidated Fixed Charge Coverage
Ratio then in effect, it being understood that the Applicable Percentage
for (i) Base Rate Loans shall be the percentage set forth under the column
"Base Rate Margin", (ii) Eurodollar Loans shall be the percentage set forth
under the column "Eurodollar Margin and Standby Letter of Credit Fee",
(iii) the Standby Letter of Credit Fee shall be the percentage set forth
under the column "Eurodollar Margin and Standby Letter of Credit Fee", (iv)
the Trade Letter of Credit Fee shall be the percentage set forth under the
column "Trade Letter of Credit Fee", and (v) the Commitment Fee shall be
the percentage set forth under the column "Commitment Fee":
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Eurodollar
Margin
Consolidated and
Fixed Charge Standby Letter Trade Letter
Pricing Coverage Base Rate of Credit of Credit Commitment
Level Ratio Margin Fee Fee Fee
----- ----- ------ --- --- ---
I less than or equal to 2.00 0.25% 1.75% 0.75% 0.375%
II greater than 2.00 0.00% 1.50% 0.60% 0.300%
but less than or equal to 2.50
III greater than 2.50 0.00% 1.25% 0.45% 0.250%
but less than or equal to 3.00
IV greater than 3.00 0.00% 1.00% 0.30% 0.250%
The Applicable Percentage shall be determined and adjusted quarterly on the
date (each a "Rate Determination Date") five (5) Business Days after the
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date by which the annual and quarterly compliance certificates and related
financial statements and information are required in accordance with the
provisions of Sections 7.1(a) and (b) and Section 7.2(b), as appropriate;
provided that:
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(i) the initial Applicable Percentages shall be based on Pricing
Level II and shall remain in effect at such Pricing Level until the
first Rate Determination Date to occur after the Closing Date, and
(ii) in the event an annual or quarterly compliance certificate
and related financial statements and information are not delivered
timely to the Agency Services Address by the date required by Sections
7.1(a) and (b) and Section 7.2(b), as appropriate, the Applicable
Percentages shall be based on Pricing Level I until such time as an
appropriate compliance certificate and related financial statements
and information are delivered, whereupon the applicable Pricing Level
shall be adjusted based on the information contained in such
compliance certificate and related financial statements and
information.
Each Applicable Percentage shall be effective from a Rate Determination
Date until the next such Rate Determination Date. The Administrative Agent
shall determine the appropriate Applicable Percentages in the pricing
matrix promptly upon receipt of the
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quarterly or annual compliance certificate and related financial
information and shall promptly notify the Borrower and the Lenders of any
change thereof. Such determinations by the Administrative Agent shall be
conclusive absent manifest error. Adjustments in the Applicable Percentages
shall be effective as to existing Extensions of Credit as well as new
Extensions of Credit made thereafter.
"Asset Disposition" means (i) the sale, lease or other disposition of
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any property or asset by any member of the Consolidated Group (including
the disposition of the capital stock of Subsidiaries), other than any such
sale permitted by Sections 8.3(b), and (ii) receipt by any member of the
Consolidated Group of any cash insurance proceeds or condemnation award
payable by reason of theft, loss, physical destruction or damage, taking or
similar event with respect to any of their property or assets.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the United
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States Code, as amended, modified, succeeded or replaced from time to time.
"Bankruptcy Event" means, with respect to any Person, the occurrence
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of any of the following with respect to such Person: (i) a court or
governmental agency having jurisdiction in the premises shall enter a
decree or order for relief in respect of such Person in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or
for any substantial part of its Property or ordering the winding up or
liquidation of its affairs; or (ii) there shall be commenced against such
Person an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or any case, proceeding or
other action for the appointment of a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of such Person or
for any substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other case,
proceeding or other action shall remain undismissed, undischarged or
unbonded for a period of sixty (60) consecutive days; or (iii) such Person
shall commence a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or consent to the entry of
an order for relief in an involuntary case under any such law, or consent
to the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of such
Person or for any substantial part of its Property or make any general
assignment for the benefit of creditors; or (iv) such Person shall be
unable to, or shall admit in writing its inability to, pay its debts
generally as they become due.
"Base Rate" means, for any day, the rate per annum (rounded upwards,
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if
10
necessary, to the nearest whole multiple of 1/100 of 1%) equal to the
greater of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1%
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or (b) the Prime Rate in effect on such day. If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable after due inquiry to
ascertain the Federal Funds Rate for any reason, including the inability or
failure of the Administrative Agent to obtain sufficient quotations in
accordance with the terms hereof, the Base Rate shall be determined without
regard to clause (a) of the first sentence of this definition until the
circumstances giving rise to such inability no longer exist. Any change in
the Base Rate due to a change in the Prime Rate or the Federal Funds Rate
shall be effective on the effective date of such change in the Prime Rate
or the Federal Funds Rate, respectively.
"Base Rate Loan" means any Loan bearing interest at a rate determined
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by reference to the Base Rate.
"Borrower" means Just For Feet, Inc., a Delaware corporation, as
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referenced in the opening paragraph, its successors and permitted assigns.
"Business Day" means a day other than a Saturday, Sunday or other day
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on which commercial banks in Atlanta, Georgia, Charlotte, North Carolina,
Birmingham, Alabama or New York, New York are authorized or required by law
to close, except that, when used in connection with a Eurodollar Loan, such
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day shall also be a day on which dealings between banks are carried on in
U.S. dollar deposits in London, England.
"Capital Lease" means, as applied to any Person, any lease of any
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Property (whether real, personal or mixed) by that Person as lessee which,
in accordance with GAAP, is or should be accounted for as a capital lease
on the balance sheet of that Person.
"Capital Lease Obligation" means the capital lease obligations
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relating to a Capital Lease determined in accordance with GAAP.
"Cash Equivalents" means (a) securities issued or directly and fully
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guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof) having maturities
of not more than twelve months from the date of acquisition, (b) U.S.
dollar denominated time deposits and certificates of deposit of (i) any
Lender, or (ii) any domestic commercial bank of recognized standing (y)
having capital and surplus in excess of $500,000,000 and (z) whose short-
term commercial paper rating from S&P is at least A-1 or the equivalent
thereof or from ▇▇▇▇▇'▇ is at
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least P-1 or the equivalent thereof (any such bank being an "Approved
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Bank"), in each case with maturities of not more than 270 days from the
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date of acquisition, (c) commercial paper and variable or fixed rate notes
issued by any Approved Bank (or by the parent company thereof) or any
variable rate notes issued by, or guaranteed by, any domestic corporation
rated A-1 (or the equivalent thereof) or better by S&P or P-1 (or the
equivalent thereof) or better by Moody's and maturing within six months of
the date of acquisition, (d) repurchase agreements entered into by a Person
with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States of
America in which such Person shall have a perfected first priority security
interest (subject to no other Liens) and having, on the date of purchase
thereof, a fair market value of at least 100% of the amount of the
repurchase obligations, (e) obligations of any State of the United States
or any political subdivision thereof, the interest with respect to which is
exempt from federal income taxation under Section 103 of the Internal
Revenue Code, having a long term rating of at least AA- or Aa-3 by S&P or
Moody's, respectively, and maturing within three years from the date of
acquisition thereof, (f) Investments in municipal auction preferred stock
(i) rated AAA (or the equivalent thereof) or better by S&P or Aaa (or the
equivalent thereof) or better by Moody's and (ii) with dividends that reset
at least once every 365 days and (g) Investments, classified in accordance
with GAAP as current assets, in money market investment programs registered
under the Investment Company Act of 1940, as amended, which are
administered by reputable financial institutions having capital of at least
$100,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (f).
"Change of Control" means the occurrence of any of the following
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events: (i) other than ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (and members of his immediate
family), any Person or two or more Persons acting in concert shall have
acquired beneficial ownership, directly or indirectly, of, or shall have
acquired by contract or otherwise, or shall have entered into a contract or
arrangement that, upon consummation, will result in its or their
acquisition of or control over, Voting Stock of the Borrower (or other
securities convertible into such Voting Stock) representing 25% or more of
the combined voting power of all Voting Stock of the Borrower, or (ii)
during any period of up to 24 consecutive months, commencing after the
Closing Date, individuals who at the beginning of such 24 month period were
directors of the Borrower (together with any new director whose election by
the Borrower's Board of Directors or whose nomination for election by the
Borrower's shareholders was approved by a vote of at least two-thirds of
the directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of
the directors of the
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Borrower then in office. As used herein, "beneficial ownership" shall have
the meaning provided in Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934.
"Closing Date" means the date hereof.
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"Commitment" means the Revolving Commitment, the LOC Commitment and
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the Swingline Commitment.
"Commitment Fee" shall have the meaning given such term in Section
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3.5(a).
"Commitment Percentage" means the Revolving Commitment Percentage.
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"Commitment Period" means the period from and including the Closing
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Date to but not including the earlier of (i) the Termination Date, or (ii)
the date on which the Commitments terminate in accordance with the
provisions of this Credit Agreement.
"Consolidated EBITDAR" means for any period for the Consolidated
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Group, the sum of Consolidated EBITDA plus lease and rent expense, in each
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case on a consolidated basis determined in accordance with GAAP applied on
an consistent basis. Except as otherwise expressly provided, the
applicable period shall be for the four consecutive fiscal quarters ending
as of the date of determination.
"Consolidated Capitalization" means as of any date for the
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Consolidated Group, the sum of Consolidated Net Worth plus Consolidated
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Funded Debt.
"Consolidated EBITDA" means for any period for the Consolidated Group,
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the sum of Consolidated Net Income plus Consolidated Interest Expense plus
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all provisions for any Federal, state or other domestic and foreign income
taxes plus depreciation and amortization, in each case on a consolidated
----
basis determined in accordance with GAAP applied on a consistent basis, but
excluding for purposes hereof extraordinary gains and losses and related
tax effects thereon. Except as otherwise expressly provided, the
applicable period shall be for the four consecutive fiscal quarters ending
as of the date of determination.
"Consolidated Fixed Charge Coverage Ratio" means for any period, the
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ratio of Consolidated EBITDAR to Consolidated Fixed Charges.
"Consolidated Fixed Charges" means for any period for the Consolidated
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Group, the sum of Consolidated Interest Expense (but only to the extent
paid in cash) plus lease and rental expense, in each case on a consolidated
----
basis determined in
13
accordance with GAAP applied on an consistent basis. Except as otherwise
expressly provided, the applicable period shall be for the four consecutive
fiscal quarters ending as of the date of determination.
"Consolidated Funded Debt" means Funded Debt of the Consolidated Group
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determined on a consolidated basis in accordance with GAAP applied on a
consistent basis.
"Consolidated Funded Debt to Capitalization Ratio" means, as of the
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last day of any fiscal quarter, the ratio of Consolidated Funded Debt on
such day to Consolidated Capitalization on such day.
"Consolidated Group" means the Borrower and its consolidated
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subsidiaries, as determined in accordance with GAAP.
"Consolidated Interest Expense" means for any period for the
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Consolidated Group, all interest expense, including the amortization of
debt discount and premium and the interest component under Capital Leases,
in each case on a consolidated basis determined in accordance with GAAP
applied on a consolidated basis. Except as expressly provided otherwise,
the applicable period shall be for the four consecutive quarters ending as
of the date of determination.
"Consolidated Leverage Ratio" means, as of the last day of any fiscal
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quarter, the ratio of Consolidated Funded Debt on such day to Consolidated
EBITDA for the period of four consecutive fiscal quarters ending as of such
day.
"Consolidated Net Income" means for any period for the Consolidated
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Group, net income on a consolidated basis determined in accordance with
GAAP applied on a consistent basis, but excluding for purposes of
determining the Consolidated Leverage Ratio and Consolidated Fixed Charge
Coverage Ratio (i) any extraordinary gains or losses and related tax
effects thereon and (ii) the cumulative effect of the change in accounting
for store pre-opening expense for 1998 up to $2,000,000. Except as
expressly provided otherwise, the applicable period shall be for the four
consecutive quarters ending as of the date of determination.
"Consolidated Net Worth" means, as of any date for the Consolidated
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Group, shareholders' equity or net worth as determined in accordance with
GAAP.
"Consolidated Tangible Net Worth" means, as of any date for the
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Consolidated Group, Consolidated Net Worth minus intangible assets, in each
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case as determined in accordance with GAAP.
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"Contractual Obligation" means, as to any Person, any provision of any
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security issued by such Person or of any material agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Credit Documents" means a collective reference to this Credit
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Agreement, the Notes, the LOC Documents, the Pledge Agreement, each Joinder
Agreement, the Administrative Agent's Fee Letter, and all other related
agreements and documents issued or delivered hereunder or thereunder or
pursuant hereto or thereto.
"Credit Party" means any of the Borrower and the Guarantors.
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"Debt Transaction" means, with respect to any member of the
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Consolidated Group, any sale, issuance or placement of Funded Debt, whether
or not evidenced by promissory note or other written evidence of
indebtedness, except for Funded Debt permitted to be incurred pursuant to
Section 8.1 (other than Subordinated Debt permitted to be incurred pursuant
to Section 8.1(i)).
"Default" means any event, act or condition which with notice or lapse
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of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, at such time,
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(i) has failed to make an Extension of Credit required pursuant to the
terms of this Credit Agreement, (ii) has failed to pay to the
Administrative Agent or any Lender an amount owed by such Lender pursuant
to the terms of the Credit Agreement or any other of the Credit Documents,
or (iii) has been deemed insolvent or has become subject to a bankruptcy or
insolvency proceeding or to a receiver, trustee or similar proceeding.
"Dollars" and "$" means dollars in lawful currency of the United
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States of America.
"Domestic Credit Party" means any Credit Party which is incorporated
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or organized under the laws of any State of the United States or the
District of Columbia.
"Domestic Subsidiary" means any Subsidiary which is incorporated or
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organized under the laws of any State of the United States or the District
of Columbia.
"Environmental Laws" means any and all lawful and applicable Federal,
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state, local and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the
environment or to emissions, discharges,
15
releases or threatened releases of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes into the environment
including, without limitation, ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or
wastes.
"Equity Transaction" means, with respect to any member of the
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Consolidated Group, any issuance of shares of its capital stock or other
equity interest, other than an issuance (i) to a member of the Consolidated
Group, (ii) in connection with a conversion of debt securities to equity or
(iii) in connection with exercise by a present or former employee, officer,
consultant or director under a stock incentive plan, stock option plan or
other equity-based compensation plan or arrangement.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA Affiliate" means an entity which is under common control with
---------------
any Credit Party within the meaning of Section 4001(a)(14) of ERISA, or is
a member of a group which includes the Borrower and which is treated as a
single employer under Sections 414(b) or (c) of the Internal Revenue Code.
"ERISA Event" means (i) with respect to any Plan, the occurrence of a
-----------
Reportable Event or the substantial cessation of operations (within the
meaning of Section 4062(e) of ERISA); (ii) the withdrawal by the Borrower,
any Subsidiary of the Borrower or any ERISA Affiliate from a Multiple
Employer Plan during a plan year in which it was a substantial employer (as
such term is defined in Section 4001(a)(2) of ERISA), or the termination of
a Multiple Employer Plan; (iii) the distribution of a notice of intent to
terminate or the actual termination of a Plan pursuant to Section
4041(a)(2) or 4041A of ERISA; (iv) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC under Section
4042 of ERISA; (v) any event or condition which would reasonably be
expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan;
(vi) the complete or partial withdrawal of the Borrower, any Subsidiary of
the Borrower or any ERISA Affiliate from a Multiemployer Plan; (vii) the
conditions for imposition of a lien under Section 302(f) of ERISA exist
with respect to any Plan; or (vii) the adoption of an amendment to any Plan
requiring the provision of security to such Plan pursuant to Section 307 of
ERISA.
16
"Eurodollar Loan" means any Loan bearing interest at a rate determined
---------------
by reference to the Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each Eurodollar
---------------
Loan comprising part of the same borrowing (including conversions,
extensions and renewals), a per annum interest rate determined pursuant to
the following formula:
Eurodollar Rate = Interbank Offered Rate
--------------------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means for any day, that percentage
-----------------------------
(expressed as a decimal) which is in effect from time to time under
Regulation D of the Board of Governors of the Federal Reserve System (or
any successor), as such regulation may be amended from time to time or any
successor regulation, as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurocurrency liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest rate
of Eurodollar Loans is determined), whether or not Lender has any
Eurocurrency liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurocurrency liabilities and
as such shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may be available from
time to time to a Lender. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.
"Event of Default" means such term as defined in Section 9.1.
----------------
"Existing Letters of Credit" means those Letters of Credit outstanding
--------------------------
on the Closing Date and identified on Schedule 2.2(b)-1.
-----------------
"Extension of Credit" means, as to any Lender, the making of, or
-------------------
participation in, a Loan by such Lender or the issuance or extension of, or
participation in, a Letter of Credit.
"Extension Consent" shall have the meaning assigned to such term in
-----------------
Section 2.1(g).
"Extension Consent Date" shall have the meaning assigned to such term
----------------------
in Section 2.1(g).
"Fees" means all fees payable pursuant to Section 3.5.
----
17
"Federal Funds Rate" means, for any day, the rate of interest per
------------------
annum (rounded upwards, if necessary, to the nearest whole multiple of
1/100 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the Federal
Reserve Bank of New York on the Business Day next succeeding such day,
provided that (A) if such day is not a Business Day, the Federal Funds Rate
--------
for such day shall be such rate on such transactions on the next preceding
Business Day and (B) if no such rate is so published on such next preceding
Business Day, the Federal Funds Rate for such day shall be the average rate
quoted to the Administrative Agent on such day on such transactions as
determined by the Administrative Agent.
"Foreign Credit Party" means a Credit Party which is not a Domestic
--------------------
Credit Party.
"Foreign Subsidiary" means a Subsidiary which is not a Domestic
------------------
Subsidiary.
"Funded Debt" means, with respect to any Person, without duplication,
-----------
(i) all Indebtedness of such Person for borrowed money, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (iii)
all purchase money Indebtedness (including for purposes hereof,
indebtedness and obligations described in clauses (iii) and (iv) of the
definition of "Indebtedness") of such Person, including without limitation
the principal portion of all obligations of such Person under Capital
Leases, (iv) all Support Obligations of such Person with respect to Funded
Indebtedness of another Person, (v) the maximum available amount of all
standby letters of credit or acceptances issued or created for the account
of such Person, (vi) all Funded Debt of another Person secured by a Lien on
any Property of such Person, whether or not such Funded Indebtedness has
been assumed, provided that for purposes hereof the amount of such Funded
--------
Debt shall be limited to the greater of (A) the amount of such Funded Debt
as to which there is recourse to such Person and (B) the fair market value
of the property which is subject to the Lien, (vii) the outstanding
attributed principal amount under any securitization transaction, and
(viii) the principal balance outstanding under any synthetic lease, tax
retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product to which such Person is a party, where such
transaction is considered borrowed money indebtedness for tax purposes but
is classified as an operating lease in accordance with GAAP. The Funded
Debt of any Person shall include the Funded Debt of any partnership or
joint venture in which such Person is a general partner or joint venturer,
but only to the extent to which there is recourse to such Person for the
payment of such Funded Debt.
18
"GAAP" means generally accepted accounting principles in the United
----
States applied on a consistent basis and subject to the terms of Section
1.3 hereof.
"Governmental Authority" means any Federal, state, local or foreign
----------------------
court or governmental agency, authority, instrumentality or regulatory
body.
"Guarantor" means each of those other Persons identified as a
---------
"Guarantor" on the signature pages hereto, and each other Person which may
hereafter become a Guarantor by execution of a Joinder Agreement, together
with their successors and permitted assigns.
"Guaranteed Obligations" means, as to each Guarantor, without
----------------------
duplication, (i) all obligations of the Borrower (including interest
accruing after a Bankruptcy Event, regardless of whether such interest is
allowed as a claim under the Bankruptcy Code) to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement, the
Notes or the other Credit Documents, and (ii) all liabilities and
obligations, whenever arising, owing from the Borrower to any Lender, or
any Affiliate of a Lender, arising under any Hedging Agreement relating to
Obligations hereunder.
"Hedging Agreements" means any interest rate protection agreement or
------------------
foreign currency exchange agreement between the Borrower and any Lender, or
any Affiliate of a Lender.
"Indebtedness" of any Person means (i) all obligations of such Person
------------
for borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, or upon which interest payments
are customarily made, (iii) all obligations of such Person under
conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions
of title under agreements with suppliers entered into in the ordinary
course of business), (iv) all obligations of such Person issued or assumed
as the deferred purchase price of Property or services purchased by such
Person (other than trade debt incurred in the ordinary course of business
and due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person, (v) all obligations of such
Person under take-or-pay or similar arrangements or under commodities
agreements, (vi) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise,
to be secured by) any Lien on, or payable out of the proceeds of production
from, Property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, provided that for purposes
--------
hereof the amount of such
19
Indebtedness shall be limited to the greater of (A) the amount of such
Indebtedness as to which there is recourse to such Person and (B) the fair
market value of the property which is subject to the Lien, (vii) all
Support Obligations of such Person, (viii) the principal portion of all
obligations of such Person under Capital Leases, (ix) all obligations of
such Person in respect of interest rate protection agreements, foreign
currency exchange agreements, commodity purchase or option agreements or
other interest or exchange rate or commodity price hedging agreements
(including, but not limited to, the Hedging Agreements), (x) the maximum
amount of all standby letters of credit issued or bankers' acceptances
facilities created for the account of such Person and, without duplication,
all drafts drawn thereunder (to the extent unreimbursed), (xi) all
preferred stock issued by such Person and required by the terms thereof to
be redeemed, or for which mandatory sinking fund payments are due, by a
fixed date, (xii) the outstanding attributed principal amount under any
securitization transaction and (xiii) the principal balance outstanding
under any synthetic lease, tax retention operating lease, off-balance sheet
loan or similar off-balance sheet financing product to which such Person is
a party, where such transaction is considered borrowed money indebtedness
for tax purposes but is classified as an operating lease in accordance with
GAAP. The Indebtedness of any Person shall include the Indebtedness of any
partnership or joint venture in which such Person is a general partner or a
joint venturer, but only to the extent to which there is recourse to such
Person for payment of such Indebtedness.
"Interbank Offered Rate" means, for the Interest Period for each
----------------------
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate (rounded
upwards, if necessary, to the nearest whole multiple of 1/100 of 1%) equal
to the rate of interest, determined by the Administrative Agent on the
basis of the offered rates for deposits in dollars for a period of time
corresponding to such Interest Period (and commencing on the first day of
such Interest Period), appearing on Telerate Page 3750 (or, if, for any
reason, Telerate Page 3750 is not available, the Reuters Screen LIBO Page)
as of approximately 11:00 A.M. (London time) two (2) Business Days before
the first day of such Interest Period. As used herein, "Telerate Page
3750" means the display designated as page 3750 by Dow ▇▇▇▇▇ Markets, Inc.
(or such other page as may replace such page on that service for the
purpose of displaying the British Bankers Association London interbank
offered rates) and "Reuters Screen LIBO Page" means the display designated
as page "LIBO" on the Reuters Monitor Money Rates Service (or such other
page as may replace the LIBO page on that service for the purpose of
displaying London interbank offered rates of major banks).
"Interest Payment Date" means (i) as to any Base Rate Loan, the last
---------------------
day of each March, June, September and December, the date of repayment of
principal of
20
such Loan and the Termination Date and (ii) as to any Eurodollar Loan and
Swingline Loan, the last day of each Interest Period for such Loan, the
date of repayment of principal of such Loan and the Termination Date, and
in addition where the applicable Interest Period is more than three months,
then also on the date three months from the beginning of the Interest
Period, and each three months thereafter. If an Interest Payment Date falls
on a date which is not a Business Day, such Interest Payment Date shall be
deemed to be the next succeeding Business Day (except that in the case of
Eurodollar Loans where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day).
"Interest Period" means (i) as to any Eurodollar Loan, a period of
---------------
one, two, three or six months' duration, as the Borrower may elect,
commencing in each case on the date of the borrowing (including
conversions, extensions and renewals) and (ii) as to any Swingline Loan, a
period of such duration, not to exceed 30 days, as the Borrower may request
and the Swingline Lender may agree in accordance with the provisions of
Section 2.3(b)(i), commencing in each case, on the date of borrowing;
provided, however, (A) if any Interest Period would end on a day which is
-------- -------
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that in the case of Eurodollar Loans where
the next succeeding Business Day falls in the next succeeding calendar
month, then on the next preceding Business Day), (B) no Interest Period
shall extend beyond the Termination Date, and (C) in the case of Eurodollar
Loans, where an Interest Period begins on a day for which there is no
numerically corresponding day in the calendar month in which the Interest
Period is to end, such Interest Period shall end on the last day of such
calendar month.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
---------------------
amended, and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to time.
References to sections of the Internal Revenue Code shall be construed also
to refer to any successor sections.
"Invested Amount" shall have the meaning given such term in the
---------------
definition of Attributed Principal Amount.
"Investment", in any Person, means any loan or advance to such Person,
----------
any purchase or other acquisition of any capital stock, warrants, rights,
options, obligations or other securities of, or equity interest in, such
Person, any capital contribution to such Person or any other investment in
such Person, including, without limitation, any Support Obligation incurred
for the benefit of such Person.
"Issuing Lender" means (a) in the case of Standby Letters of Credit,
--------------
NationsBank, (b) in the case of Trade Letters of Credit, Marine Midland
Bank, its
21
affiliates or such other Lender as to which the Borrower may request and
such Lender shall agree, and (c) in the case of Existing Letters of Credit,
the Lender identified as the issuer on Schedule 2.2(b)-1.
-----------------
"Issuing Lender Fees" shall have the meaning assigned to such term in
-------------------
Section 3.5(b)(ii).
"Joinder Agreement" means a Joinder Agreement substantially in the
-----------------
form of Schedule 7.11 hereto, executed and delivered by an Additional
-------------
Credit Party in accordance with the provisions of Section 7.11.
"Lenders" means each of the Persons identified as a "Lender" on the
-------
signature pages hereto, and their successors and assigns.
"Letter of Credit" means an Existing Letter of Credit, a Standby
----------------
Letter of Credit or a Trade Letter of Credit, as appropriate.
"Letter of Credit Fees" means the Standby Letter of Credit Fee and the
---------------------
Trade Letter of Credit Fee.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
----
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind (including any agreement to give
any of the foregoing, any conditional sale or other title retention
agreement, any financing or similar statement or notice filed under the
Uniform Commercial Code as adopted and in effect in the relevant
jurisdiction or other similar recording or notice statute, and any lease in
the nature thereof).
"Loan" or "Loans" means the Revolving Loans and/or Swingline Loans.
---- -----
"LOC Commitment" means the Standby LOC Commitment and the Trade LOC
--------------
Commitment.
"LOC Committed Amount" means, collectively, the aggregate amount of
--------------------
all of the LOC Commitments of the Lenders to issue and participate in
Letters of Credit as referenced in Section 2.2(a) and, individually, the
amount of each Lender's LOC Commitment as specified in Schedule 2.1(a).
---------------
"LOC Documents" means, with respect to any Letter of Credit, such
-------------
Letter of Credit, any amendments thereto, any documents delivered in
connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents
22
(whether general in application or applicable only to such Letter of
Credit) governing or providing for (i) the rights and obligations of the
parties concerned or at risk or (ii) any collateral security for such
obligations.
"LOC Obligations" means, at any time, the sum of Standby LOC
---------------
Obligations plus Trade LOC Obligations.
----
"Material Adverse Effect" means a material adverse effect on (i) the
-----------------------
condition (financial or otherwise), operations, business, assets,
liabilities or prospects of the Consolidated Group taken as a whole, (ii)
the ability of the Credit Parties taken as a whole to perform any material
obligation under the Credit Documents to which it is a party or (iii) the
rights and remedies of the Lenders under the Credit Documents.
"Materials of Environmental Concern" means any gasoline or petroleum
----------------------------------
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as
such in or under any Environmental Laws, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or any successor or
-------
assignee of the business of such company in the business of rating
securities.
"Multiemployer Plan" means a Plan which is a multiemployer plan as
------------------
defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which the Borrower, any
----------------------
Subsidiary of the Borrower or any ERISA Affiliate and at least one employer
other than the Borrower, any Subsidiary of the Borrower or any ERISA
Affiliate are contributing sponsors.
"NationsBank" means NationsBank, N.A. and its successors.
-----------
"Net Proceeds" means gross cash proceeds (including any cash received
------------
by way of deferred payment pursuant to a promissory note, receivable or
otherwise, but only as and when received) received in connection with an
Asset Disposition, Equity Transaction or Debt Transaction, net of (i)
reasonable transaction costs, including in the case of an Equity
Transaction or a Debt Transaction, underwriting discounts and commissions
and in the case of an Asset Disposition occurring in connection with a
claim under an insurance policy, costs incurred in connection with
adjustment and settlement of the claim, (ii) estimated taxes payable in
connection therewith, and (iii) in the case of an Asset Disposition or Debt
Transaction, any amounts payable in
23
respect of Funded Debt, including without limitation principal, interest,
premiums and penalties, which is secured by, or otherwise related to, any
property or asset which is the subject thereof to the extent that such
Funded Debt and any payments in respect thereof are paid with a portion of
the proceeds therefrom.
"Non-Excluded Taxes" means such term as is defined in Section 3.10.
------------------
"Note" or "Notes" means any Revolving Note.
---- -----
"Notice of Borrowing" means a written notice of borrowing in
-------------------
substantially the form of Schedule 2.1(b)(i), as required by Section
------------------
2.1(b)(i).
"Notice of Extension/Conversion" means a written notice of extension
------------------------------
or conversion in substantially the form of Schedule 3.2, as required by
------------
Section 3.2.
"Obligations" means, collectively, the Revolving Loans, Swingline
-----------
Loans and the LOC Obligations.
"Operating Lease" means, as applied to any Person, any lease
---------------
(including, without limitation, leases which may be terminated by the
lessee at any time) of any Property (whether real, personal or mixed) which
is not a Capital Lease other than any such lease in which that Person is
the lessor.
"Participation Interest" means the purchase by a Lender of a
----------------------
participation in LOC Obligations as provided in Section 2.2(c), in
Swingline Loans as provided in Section 2.3(b)(iii) and in Loans as provided
in Section 3.13.
"PBGC" means the Pension Benefit Guaranty Corporation established
----
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"Permitted Investments" means Investments which are either (i) cash
---------------------
and Cash Equivalents; (ii) accounts receivable created, acquired or made in
the ordinary course of business and payable or dischargeable in accordance
with customary trade terms; (iii) Investments consisting of stock,
obligations, securities or other property received in settlement of
accounts receivable (created in the ordinary course of business) from
bankrupt obligors; (iv) Investments existing as of the Closing Date and set
forth in Schedule 8.4, (v) Support Obligations permitted by Section 8.1;
------------
(vi) acquisitions permitted by Section 8.3(c)(ii); (vii) transactions
permitted by Section 8.5, (viii) loans to employees, directors or officers
in connection with the award of convertible bonds or stock under a stock
incentive plan, stock option plan or other equity-based compensation plan
or arrangement in the aggregate not to exceed $1,000,000
24
(calculated on the exercise price for any such shares) in the aggregate at
any time outstanding; (ix) other advances or loans to employees, directors,
officers or agents not to exceed $1,000,000 in the aggregate at any time
outstanding; (x) advances or loans to customers or suppliers that do not
exceed $1,000,000 in the aggregate at any one time outstanding, (xi)
Investments by one Credit Party in and to another Credit Party and (xii)
other loans, advances and investments of a nature not contemplated in the
foregoing subsections in an amount not to exceed $1,000,000 in the
aggregate at any time outstanding.
"Permitted Liens" means:
---------------
(i) Liens in favor of the Administrative Agent on behalf of the
Lenders; and
(ii) Liens in favor of a Lender or an Affiliate of a Lender pursuant
to a Hedging Agreement permitted hereunder, but only (A) to the extent
such Liens secure obligations under such agreements permitted under
Section 8.1, (B) to the extent such Liens are on the same collateral
as to which the Lenders also have a Lien and (C) if such provider and
the Lender shall share pari passu in the collateral subject to such
---- -----
Liens; and
(iii) Liens (other than Liens created or imposed under ERISA) for
taxes, assessments or governmental charges or levies not yet due or
Liens for taxes being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with
GAAP have been established (and as to which the Property subject to
any such Lien is not yet subject to foreclosure, sale or loss on
account thereof); and
(iv) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and suppliers and other Liens imposed by law or
pursuant to customary reservations or retentions of title arising in
the ordinary course of business, provided that such Liens secure only
--------
amounts not yet due and payable or, if due and payable, are unfiled
and no other action has been taken to enforce the same or are being
contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been established (and
as to which the Property subject to any such Lien is not yet subject
to foreclosure, sale or loss on account thereof); and
(v) Liens (other than Liens created or imposed under ERISA) incurred
or deposits made by the Borrower and its Subsidiaries in the ordinary
course of business in connection with workers' compensation,
unemployment
25
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of
borrowed money); and
(vi) Liens in connection with attachments or judgments (including
judgment or appeal bonds) provided that the judgments secured shall,
--------
within 30 days after the entry thereof, have been discharged or
execution thereof stayed pending appeal, or shall have been discharged
within 30 days after the expiration of any such stay; and
(vii) easements, rights-of-way, restrictions (including zoning
restrictions), minor defects or irregularities in title and other
similar charges or encumbrances not, in any material respect,
impairing the use of the encumbered Property for its intended
purposes; and
(viii) Liens securing purchase money and sale/leaseback Indebtedness
(including Capital Leases) to the extent permitted under Sections
8.1(c) or (d), provided that any such Lien attaches only to the
--------
Property financed or leased and such Lien attaches thereto
concurrently with or within 90 days after the acquisition thereof in
connection with the purchase money transactions and within 30 days
after the closing of any sale/leaseback transaction; and
(ix) leases or subleases granted to others not interfering in any
material respect with the business of any member of the Consolidated
Group; and
(x) any interest of title of a lessor under, and Liens arising from
UCC financing statements (or equivalent filings, registrations or
agreements in foreign jurisdictions) relating to, leases permitted by
this Credit Agreement; and
(xi) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with
the importation of goods; and
(xii) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under Section 8.4; and
(xiii) normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions; and
26
(xiv) Liens existing as of the Closing Date and set forth on Schedule
--------
6.8; provided that (a) no such Lien shall at any time be extended to
--- --------
or cover any Property other than the Property subject thereto on the
Closing Date and (b) the principal amount of the Indebtedness secured
by such Liens shall not be extended, renewed, refunded or refinanced.
"Person" means any individual, partnership, joint venture, firm,
------
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated) or any Governmental Authority.
"Plan" means any employee benefit plan (as defined in Section 3(3) of
----
ERISA) which is covered by ERISA and with respect to which the Borrower,
any Subsidiary of the Borrower or any ERISA Affiliate is (or, if such plan
were terminated at such time, would under Section 4069 of ERISA be deemed
to be) an "employer" within the meaning of Section 3(5) of ERISA.
"Pledge Agreement" means the Pledge Agreement dated as of the Closing
----------------
Date given by the Borrower and the other pledgors identified therein to
NationsBank, N.A., as Administrative Agent, to secure the obligations
hereunder, as amended and modified.
"Prime Rate" means the rate of interest per annum publicly announced
----------
from time to time by NationsBank as its prime rate in effect at its
principal office in Charlotte, North Carolina, with each change in the
Prime Rate being effective on the date such change is publicly announced as
effective (it being understood and agreed that the Prime Rate is a
reference rate used by NationsBank in determining interest rates on certain
loans and is not intended to be the lowest rate of interest charged on any
extension of credit by NationsBank to any debtor).
"Pro Forma Basis" means, with respect to any Transaction, that such
---------------
Transaction shall be deemed to have occurred as of the first day of the
four fiscal-quarter period ending as of the most recent fiscal quarter end
preceding the date of such Transaction with respect to which the
Administrative Agent and the Lenders have received the officer's
certificate in accordance with the provisions of Section 7.2(b). As used
herein, "Transaction" means (i), the incurrence of Subordinated Debt as
referred to in Section 8.1(i), (ii) any sale or other disposition of assets
as referred to in Section 8.3(b), (iii) any acquisition of capital stock or
securities or any purchase, lease or other acquisition of property as
referred to in Section 8.3(c), (iv) the prepayment, redemption, defeasance
or acquisition for value of other Indebtedness as referred to in Section
8.8, or (v) the making of any Restricted Payment as referred to in Section
8.9.
27
"Property" means any interest in any kind of property or asset,
--------
whether real, personal or mixed, or tangible or intangible.
"Receivables" means any right of payment from or on behalf of any
-----------
obligor, whether constituting an account, chattel paper, instrument,
general intangible or otherwise, arising from the sale or financing by a
member of the Consolidated Group or merchandise or services, and monies due
thereunder, security in the merchandise and services financed thereby,
records related thereto, and the right to payment of any interest or
finance charges and other obligations with respect thereto, proceeds from
claims on insurance policies related thereto, any other proceeds related
thereto, and any other related rights.
"Register" shall have the meaning given such term in Section 11.3(c).
--------
"Regulation T, U or X" means Regulation T, U or X, respectively, of
--------------------
the Board of Governors of the Federal Reserve System as from time to time
in effect and any successor to all or a portion thereof.
"Release" means any spilling, leaking, pumping, pouring, emitting,
-------
emptying, discharging, injecting, escaping, leaching, dumping or disposing
into the environment (including the abandonment or discarding of barrels,
containers and other closed receptacles containing any Materials of
Environmental Concern).
"Reportable Event" means any of the events set forth in Section
----------------
4043(c) of ERISA, other than those events as to which the notice
requirement has been waived by regulation.
"Required Lenders" means, at any time, Lenders having more than fifty
----------------
percent (50%) of the Commitments, or if the Commitments have been
terminated, Lenders having more than fifty percent (50%) of the aggregate
principal amount of the Obligations outstanding (taking into account in
each case Participation Interests or obligation to participate therein);
provided that the Commitments of, and outstanding principal amount of
--------
Obligations (taking into account Participation Interests therein) owing to,
a Defaulting Lender shall be excluded for purposes hereof in making a
determination of Required Lenders.
"Requirement of Law" means, as to any Person, the certificate of
------------------
incorporation and by-laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or
28
any of its material property is subject.
"Responsible Officer" means the Chief Financial Officer, the
-------------------
Controller and any Vice President.
"Restricted Payment" means (i) any dividend or other distribution,
------------------
direct or indirect, on account of any shares of any class of stock now or
hereafter outstanding, except (A) a dividend payable solely in shares of
that class to the holders of that class and (B) dividends and other
distributions payable to a Credit Party, (ii) any redemption, retirement,
sinking fund or similar payment, purchase or other acquisition for value,
direct or indirect, of any shares of any class of stock now or hereafter
outstanding and (iii) any payment made to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights to acquire
shares of any class of stock now or hereafter outstanding.
"Revolving Commitment" means, with respect to each Lender, the
--------------------
commitment of such Lender to make Revolving Loans in an aggregate principal
amount at any time outstanding of up to such Lender's Commitment Percentage
of the Aggregate Revolving Committed Amount as specified in Schedule
--------
2.1(a), as such amount may be reduced from time to time in accordance with
------
the provisions hereof.
"Revolving Commitment Percentage" means, for each Lender, a fraction
-------------------------------
(expressed as a decimal) the numerator of which is the Revolving Commitment
of such Lender at such time and the denominator of which is the Aggregate
Revolving Committed Amount at such time. The initial Revolving Commitment
Percentages are set out on Schedule 2.1(a).
---------------
"Revolving Committed Amount" means, collectively, the aggregate amount
--------------------------
of all of the Revolving Commitments and, individually, the amount of each
Lender's Revolving Commitment as specified in Schedule 2.1(a).
---------------
"Revolving Loans" shall have the meaning assigned to such term in
---------------
Section 2.1(a).
"Revolving Note" or "Revolving Notes" means the promissory notes of
-------------- ---------------
the Borrower in favor of each of the Lenders evidencing the Revolving Loans
and the Swingline Loans in substantially the form attached as Schedule
--------
2.1(e), individually or collectively, as appropriate, as such promissory
------
notes may be amended, modified, supplemented, extended, renewed or replaced
from time to time.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw
---
Hill,
29
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"Single Employer Plan" means any Plan which is covered by Title IV of
--------------------
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"Standby Letter of Credit" means any standby letter of credit issued
------------------------
by the Issuing Lender for the account of the Borrower in accordance with
the terms of Section 2.2 as such letter of credit may be amended, modified,
extended, renewed or replaced from time to time.
"Standby Letter of Credit Fee" shall have the meaning assigned to such
----------------------------
term in Section 3.5(b)(i).
"Standby LOC Commitment" means the commitment of the Issuing Lender to
----------------------
issue, and to honor payment obligations under, Standby Letters of Credit
hereunder and with respect to each Lender, the commitment of each Lender to
purchase participation interests in the Standby Letters of Credit up to
such Lender's LOC Committed Amount as specified in Schedule 2.1(a), as such
---------------
amount may be reduced from time to time in accordance with the provisions
hereof.
"Standby LOC Obligations" means, at any time, the sum of (i) the
-----------------------
maximum amount which is, or at any time thereafter may become, available to
be drawn under Standby Letters of Credit then outstanding, assuming
compliance with all requirements for drawings referred to in such Standby
Letters of Credit plus (ii) the aggregate amount of all drawings under
----
Standby Letters of Credit honored by the Issuing Lender but not
theretofore reimbursed.
"Subject Properties" shall have the meaning assigned to such term in
------------------
Section 6.15(a).
"Subordinated Debt" means any Indebtedness of a member of the
-----------------
Consolidated Group which by its terms is expressly subordinated in right of
payment to the prior payment of the obligations under the Credit Agreement
and the other Credit Documents on terms and conditions and evidenced by
documentation satisfactory to the Required Lenders.
"Subsidiary" means, as to any Person, (a) any corporation more than
----------
50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time, any class or
classes of such corporation shall have or might have voting
30
power by reason of the happening of any contingency) is at the time owned
by such Person directly or indirectly through Subsidiaries, and (b) any
partnership, association, joint venture or other entity in which such
Person directly or indirectly through Subsidiaries has more than 50% of the
voting interests at any time. Unless otherwise identified, "Subsidiary" or
"Subsidiaries" shall mean Subsidiaries of the Borrower.
"Support Obligations" means, with respect to any Person, without
-------------------
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or
collection) guaranteeing or intended to guarantee any Indebtedness of any
other Person in any manner, whether direct or indirect, and including
without limitation any obligation, whether or not contingent, (i) to
purchase any such Indebtedness or any Property constituting security
therefor, (ii) to advance or provide funds or other support for the payment
or purchase of any such Indebtedness or to maintain working capital,
solvency or other balance sheet condition of such other Person (including
without limitation keep well agreements, maintenance agreements, comfort
letters or similar agreements or arrangements) for the benefit of any
holder of Indebtedness of such other Person, (iii) to lease or purchase
Property, securities or services primarily for the purpose of assuring the
holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The
amount of any Support Obligation hereunder shall (subject to any
limitations set forth therein) be deemed to be an amount equal to the
outstanding principal amount (or maximum principal amount, if larger) of
the Indebtedness in respect of which such Support Obligation is made.
"Swingline Commitment" means the commitment of the Swingline Lender to
--------------------
make Swingline Loans in an aggregate principal amount at any time
outstanding up to the Swingline Committed Amount and the commitment of the
Lenders to purchase participation interests in the Swingline Loans up to
their respective Revolving Commitment Percentage as provided in Section
2.3(b)(iii), as such amounts may be reduced from time to time in accordance
with the provisions hereof.
"Swingline Committed Amount" means the amount of the Swingline
--------------------------
Lender's Commitment as specified in Section 2.3(a).
"Swingline Lender" means NationsBank or its successor.
----------------
"Swingline Loan" means a swingline revolving loan made by the
--------------
Swingline Lender pursuant to the provisions of Section 2.3.
"Termination Date" means December 10, 2001, or if extended with the
----------------
written consent of each of the Lenders, such later date as to which the
Termination Date may
31
be extended.
"Trade Letter of Credit" means any trade, documentary or merchandise
----------------------
letter of credit issued by the Issuing Lender for the account of the
Borrower in accordance with the terms of Section 2.2 as such letter of
credit may be amended, modified, extended, renewed or replaced from time to
time.
"Trade Letter of Credit Fee" shall have the meaning assigned to such
--------------------------
term in Section 3.5(b)(ii).
"Trade LOC Commitment" means the commitment of the Issuing Lender to
--------------------
issue, and to honor payment obligations under, Trade Letters of Credit
hereunder and with respect to each Lender, the commitment of each Lender to
purchase participation interests in the Trade Letters of Credit up to such
Lender's Trade LOC Committed Amount as specified in Schedule 2.1(a), as
---------------
such amount may be reduced from time to time in accordance with the
provisions hereof.
"Trade LOC Committed Amount" shall have the meaning assigned to such
--------------------------
term in Section 2.2(a).
"Trade LOC Obligations" means, at any time, the sum of (i) the maximum
---------------------
amount which is, or at any time thereafter may become, available to be
drawn under Trade Letters of Credit then outstanding, assuming compliance
with all requirements for drawings referred to in such Trade Letters of
Credit plus (ii) the aggregate amount of all drawings under Trade Letters
----
of Credit honored by the Issuing Lender but not theretofore reimbursed.
"Voting Stock" means, with respect to any Person, capital stock issued
------------
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to
vote has been suspended by the happening of such a contingency.
1.2 Computation of Time Periods.
---------------------------
For purposes of computation of periods of time hereunder, the word "from"
means "from and including" and the words "to" and "until" each mean "to but
excluding."
1.3 Accounting Terms.
----------------
Except as otherwise expressly provided herein, all accounting terms used
herein
32
shall be interpreted, and all financial statements and certificates and reports
as to financial matters required to be delivered to the Lenders hereunder shall
be prepared, in accordance with GAAP applied on a consistent basis. All
calculations made for the purposes of determining compliance with this Credit
Agreement shall (except as otherwise expressly provided herein) be made by
application of GAAP applied on a basis consistent with the most recent annual or
quarterly financial statements delivered pursuant to Section 7.1 hereof (or,
prior to the delivery of the first financial statements pursuant to Section 7.1
hereof, consistent with the annual audited financial statements referenced in
Section 6.1(i) hereof); provided, however, if (a) the Borrower shall object to
-------- -------
determining such compliance on such basis at the time of delivery of such
financial statements due to any change in GAAP or the rules promulgated with
respect thereto or (b) the Administrative Agent or the Required Lenders shall so
object in writing within 30 days after delivery of such financial statements,
then such calculations shall be made on a basis consistent with the most recent
financial statements delivered by the Borrower to the Lenders as to which no
such objection shall have been made.
It is further acknowledged and agreed that, except as expressly provided
otherwise, for purposes of determining the Applicable Percentage and compliance
with the financial covenants in Section 7.9 (and compliance therewith on a Pro
Forma Basis), in the case of acquisitions and dispositions which have occurred
during the applicable period to the extent permitted hereunder, adjustments
shall be made to take into account historical performance relating thereto
during such applicable period prior to the date of such acquisition or
disposition, and the effect of any Indebtedness paid with proceeds from a
disposition.
SECTION 2
CREDIT FACILITIES
-----------------
2.1 Revolving Loans.
---------------
(a) Revolving Commitment. During the Commitment Period, subject to the
--------------------
terms and conditions hereof, each Lender severally agrees to make revolving
credit loans (the "Revolving Loans") to the Borrower from time to time in the
---------------
amount of such Lender's Revolving Commitment Percentage of such Revolving Loans
for the purposes hereinafter set forth; provided that (i) with regard to the
--------
Lenders collectively, the aggregate principal amount of Obligations outstanding
at any time shall not exceed the Aggregate Revolving Committed Amount, and (ii)
with regard to each Lender individually, such Lender's Revolving Commitment
Percentage of Obligations outstanding at any time shall not exceed such Lender's
Revolving Committed Amount. Revolving Loans may consist of Base Rate Loans or
Eurodollar Loans, or a combination thereof, as the Borrower may request, and may
be repaid and reborrowed in accordance with the provisions hereof.
33
(b) Revolving Loan Borrowings.
-------------------------
(i) Notice of Borrowing. The Borrower shall request a Revolving Loan
-------------------
borrowing by written notice (or telephone notice promptly confirmed in
writing) to the Administrative Agent not later than 11:30 A.M. (Charlotte,
North Carolina time) on the Business Day of the requested borrowing in the
case of Base Rate Loans, and not later than 1:00 P.M. (Charlotte, North
Carolina time) on the third Business Day prior to the date of the requested
borrowing in the case of Eurodollar Loans. Each such request for borrowing
shall be irrevocable and shall specify (A) that a Revolving Loan is
requested, (B) the date of the requested borrowing (which shall be a
Business Day), (C) the aggregate principal amount to be borrowed, and (D)
whether the borrowing shall be comprised of Base Rate Loans, Eurodollar
Loans or a combination thereof, and if Eurodollar Loans are requested, the
Interest Period(s) therefor. If the Borrower shall fail to specify in any
such Notice of Borrowing (I) an applicable Interest Period in the case of a
Eurodollar Loan, then such notice shall be deemed to be a request for an
Interest Period of one month, or (II) the type of Revolving Loan requested,
then such notice shall be deemed to be a request for a Base Rate Loan
hereunder. The Administrative Agent shall give notice to each Lender
promptly upon receipt of each Notice of Borrowing pursuant to this Section
2.1(b)(i), the contents thereof and each such Lender's share of any
borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Revolving Loan shall be in a minimum
---------------
aggregate principal amount of $5,000,000, in the case of Eurodollar Loans,
or $1,000,000 (or the remaining Revolving Committed Amount, if less), in
the case of Base Rate Loans, and integral multiples of $1,000,000 in excess
thereof.
(iii) Advances. Each Lender will make its Revolving
--------
Commitment Percentage of each Revolving Loan borrowing available to the
Administrative Agent for the account of the Borrower, or in such other
manner as the Administrative Agent may specify in writing, by 1:00 P.M.
(Charlotte, North Carolina time) on the date specified in the applicable
Notice of Borrowing in Dollars and in funds immediately available to the
Administrative Agent. Such borrowing will then be made available to the
Borrower by the Administrative Agent by crediting the account of the
Borrower with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.
(c) Repayment. The principal amount of all Revolving Loans shall be due
---------
and payable in full on the Termination Date.
(d) Interest. Subject to the provisions of Section 3.1,
--------
34
(i) Base Rate Loans. During such periods as Revolving Loans shall be
---------------
comprised in whole or in part of Base Rate Loans, such Base Rate Loans
shall bear interest at a per annum rate equal to the Base Rate plus the
----
Applicable Percentage;
(ii) Eurodollar Loans. During such periods as Revolving Loans shall be
----------------
comprised in whole or in part of Eurodollar Loans, such Eurodollar Loans
shall bear interest at a per annum rate equal to the Eurodollar Rate plus
----
the Applicable Percentage.
Interest on Revolving Loans shall be payable in arrears on each applicable
Interest Payment Date (or at such other times as may be specified herein).
(e) Revolving Notes. The Revolving Loans shall be evidenced by a duly
---------------
executed Revolving Note in favor of each Lender.
(f) Maximum Number of Eurodollar Loans. The Borrower will be limited to a
----------------------------------
maximum number of ten (10) Eurodollar Loans outstanding at any time. For
purposes hereof, Eurodollar Loans with separate or different Interest Periods
will be considered as separate Eurodollar Loans even if their Interest Periods
expire on the same date.
(g) Extension of Termination Date. The Borrower may, within 60 days, but
-----------------------------
not less than 45 days, prior to the first and second anniversary date of the
Closing Date (each such anniversary date being referred to as an "Anniversary
-----------
Date"), by notice to the Administrative Agent, make written request of the
----
Lenders to extend the Termination Date for an additional period of one year.
The Administrative Agent will give prompt notice to each of the Lenders of its
receipt of any such request for extension of the Termination Date. Each Lender
shall make a determination not later than 30 days prior to the then applicable
Anniversary Date (the "Extension Consent Date") as to whether or not it will
----------------------
agree to extend the Termination Date as requested (such approval of an extension
shall be an "Extension Consent"); provided, however, that failure by any Lender
----------------- -------- -------
to make a timely response to the Borrower's request for extension of the
Termination Date shall be deemed to constitute a refusal by such Lender to
extension of the Termination Date.
(h) Lender Not Consenting. If by any Extension Consent Date the Borrower
---------------------
and the Administrative Agent have not received an Extension Consent from any
Lender, the Termination Date, as it relates to such Lender, shall not be
extended, the Commitment of such Lender shall terminate on the Termination Date
applicable to it and any Loans made by such Lender and all accrued and unpaid
interest thereon shall be due and payable on such Termination Date. Upon the
termination of the Commitment of any such Lender, unless this Agreement is
amended as provided in Subsections 2.1(j) or 2.1(k), the aggregate amount of the
Commitments shall be reduced by the amount of such terminated Commitment, and
the
35
Revolving Commitment Percentage of each other Lender shall be adjusted to
that percentage obtained by dividing the Commitment of such Lender by the
aggregate amount of the Commitments after giving effect to such reduction as
provided in the definition of "Revolving Commitment Percentage".
(i) Other Lenders. No refusal by any one Lender to consent to any
-------------
extension of the Termination Date shall affect the extension of the Termination
Date as it may relate to the Commitment and Loans of any Lender which consents
to such extension as provided in Subsection 2.1(g), and one or more Lenders may
consent to the extension of the Termination Date as it relates to them
notwithstanding any refusal by any other Lenders so to consent; provided that
--------
even as to the consenting Lenders the Termination Date will be extended only
upon consent to such an extension by Lenders holding more than 50% of the
aggregate Commitments outstanding at the time of the request for extension.
(j) Increase in Commitment of Other Lender or Lenders. If any Lender does
-------------------------------------------------
not deliver an Extension Consent as provided in Subsection 2.1(g), upon the
expiration of the Commitment of such Lender, the Borrower may offer each Lender
which has delivered an Extension Consent as provided in Subsection 2.1(g) a
reasonable opportunity to increase its Commitment by an amount equal to its pro-
rata share (based on its Commitment before such increase) of the Commitment of
the Lender which does not deliver an Extension Consent as provided in Subsection
2.1(g). After giving such Lenders such an opportunity, the Borrower may with
the approval of the Administrative Agent amend this Agreement to increase the
Commitment of any other Lender or Lenders with the consent of such Lender or
Lenders provided that such increase does not increase the aggregate amount of
the Commitments to an amount greater than the aggregate amount of Commitments in
effect immediately before such expiration or termination.
(k) Additional Lender or Lenders. If any Lender does not deliver an
----------------------------
Extension Consent as provided in Section 2.1(g), upon the expiration of the
Commitment of such Lender, the Borrower may with the approval of the
Administrative Agent amend this Agreement as provided in Subsections 11.3 and
11.6 to add one or more other Lenders as parties, with such Commitment or
Commitments as may be agreed to by the Administrative Agent and such other
Lender or Lenders, provided that such additions do not increase the aggregate
amount of the Commitments to an amount greater than the aggregate amount of
Commitments in effect immediately before such expiration or termination.
(l) Notice. The Administrative Agent shall promptly provide each of the
------
Lenders with a copy of any amendment made pursuant to Subsection 2.1(j) or
Subsection 2.1(k).
2.2 Letter of Credit Subfacility.
----------------------------
36
(a) Issuance. During the Commitment Period, subject to the terms and
--------
conditions hereof and of the LOC Documents, if any, and such other terms and
conditions which the Issuing Lender may reasonably require, the Issuing Lender
shall issue, and the Lenders shall participate in, such Letters of Credit as the
Borrower may request for its own account or for the account of another Credit
Party as provided herein, in a form acceptable to the Issuing Lender, for the
purposes hereinafter set forth; provided that (i) the aggregate amount of LOC
--------
Obligations shall not exceed TWENTY-FIVE MILLION DOLLARS ($25,000,000) at any
time (the "LOC Committed Amount"), (ii) the aggregate amount of Trade LOC
--------------------
Obligations shall not exceed TWENTY MILLION DOLLARS ($20,000,000) at any time
(the "Trade LOC Committed Amount"), (iii) with regard to the Lenders
--------------------------
collectively, the aggregate principal amount of Obligations outstanding at any
time shall not exceed the Aggregate Revolving Committed Amount, and (iv) with
regard to each Lender individually, such Lender's Revolving Commitment
Percentage of Obligations outstanding at any time shall not exceed such Lender's
Revolving Committed Amount. Standby Letters of Credit issued hereunder shall
not have an original expiry date more than one year from the date of issuance or
extension, and Trade Letters of Credit issued hereunder shall not have an
original expiry date more than 180 days from the date of issuance or extension.
No Letter of Credit issued hereunder shall have an expiry date, whether as
originally issued or by extension, extending beyond the Termination Date. Each
Letter of Credit shall comply with the related LOC Documents, except in the case
of any discrepancies in documents delivered in connection with a Trade Letter of
Credit which are waived by the Borrower. The issuance date of each Letter of
Credit shall be a Business Day except in the case of an issuance of Trade
Letters of Credit by an overseas affiliate of the Issuing Lender.
(b) Notice and Reports. Except for those Letters of Credit described on
------------------
Schedule 2.2(b)-1 which shall be issued on the Closing Date, the request for the
-----------------
issuance of a Letter of Credit shall be submitted by the Borrower to the Issuing
Lender at least three (3) Business Days prior to the requested date of issuance
(or such shorter period as may be agreed by the Issuing Lender) in the case of
Standby Letters of Credit and at least one (1) Business Day prior to the
requested date of issuance in the case of Trade Letters of Credit. A form of
Notice of Request for Standby Letter of Credit is attached as Schedule 2.2(b)-2
-----------------
and a form of Notice of Request for Trade Letter of Credit is attached as
Schedule 2.2(b)-3. The Issuing Lender will provide to the Administrative Agent
-----------------
at least monthly, and more frequently upon request, a detailed summary report on
its Letters of Credit and the activity thereon, in form and substance acceptable
to the Administrative Agent. In addition, the Issuing Lender will provide to
the Administrative Agent for dissemination to the Lenders at least quarterly,
and more frequently upon request, a detailed summary report on its Letters of
Credit and the activity thereon, including, among other things, the Credit Party
for whose account the Letter of Credit is issued, the beneficiary, the face
amount, and the expiry date. The Issuing Lender will provide copies of the
Letters of Credit to the Administrative Agent and the Lenders promptly upon
request.
37
(c) Participation. Each Lender, with respect to the Existing Letters of
-------------
Credit, hereby purchases a participation interest in such Existing Letters of
Credit, and with respect to Letters of Credit issued on or after the Closing
Date, upon issuance of a Letter of Credit, shall be deemed to have purchased
without recourse a risk participation from the applicable Issuing Lender in such
Letter of Credit and the obligations arising thereunder, in each case in an
amount equal to its pro rata share of the obligations under such Letter of
Credit (based on the respective Commitment Percentages of the Lenders) and shall
absolutely, unconditionally and irrevocably assume, as primary obligor and not
as surety, and be obligated to pay to the Issuing Lender therefor and discharge
when due, its pro rata share of the obligations arising under such Letter of
Credit. Without limiting the scope and nature of each Lender's participation in
any Letter of Credit, to the extent that the Issuing Lender has not been
reimbursed as required hereunder or under any such Letter of Credit, each such
Lender shall pay to the Issuing Lender its pro rata share of such unreimbursed
drawing in same day funds on the day of notification by the Issuing Lender of an
unreimbursed drawing pursuant to the provisions of subsection (d) hereof. The
obligation of each Lender to so reimburse the Issuing Lender shall be absolute
and unconditional and shall not be affected by the occurrence of a Default, an
Event of Default or any other occurrence or event. Any such reimbursement shall
not relieve or otherwise impair the obligation of the Borrower to reimburse the
Issuing Lender under any Letter of Credit, together with interest as hereinafter
provided.
(d) Reimbursement. In the event of any drawing under any Letter of Credit,
-------------
the Issuing Lender will promptly notify the Borrower. Unless the Borrower shall
immediately notify the Issuing Lender that the Borrower intends to otherwise
reimburse the Issuing Lender for such drawing, the Borrower shall be deemed to
have requested that the Lenders make a Revolving Loan in the amount of the
drawing as provided in subsection (e) hereof on the related Letter of Credit,
the proceeds of which will be used to satisfy the related reimbursement
obligations. The Borrower promises to reimburse the Issuing Lender on the day
of drawing under any Letter of Credit (either with the proceeds of a Revolving
Loan obtained hereunder or otherwise) in same day funds. If the Borrower shall
fail to reimburse the Issuing Lender as provided hereinabove, the unreimbursed
amount of such drawing shall bear interest at a per annum rate equal to the Base
Rate plus the sum of (i) the Applicable Percentage and (ii) two percent (2%).
The Borrower's reimbursement obligations hereunder shall be absolute and
unconditional under all circumstances irrespective of any rights of setoff,
counterclaim or defense to payment the Borrower may claim or have against the
Issuing Lender, the Administrative Agent, the Lenders, the beneficiary of the
Letter of Credit drawn upon or any other Person, including without limitation
any defense based on any failure of the Borrower or any other Credit Party to
receive consideration or the legality, validity, regularity or unenforceability
of the Letter of Credit. The Issuing Lender will promptly notify the other
Lenders of the amount of any unreimbursed drawing and each Lender shall promptly
pay to the Administrative Agent for the account of the Issuing Lender in Dollars
and in immediately
38
available funds, the amount of such Lender's pro rata share of such unreimbursed
drawing. Such payment shall be made on the day such notice is received by such
Lender from the Issuing Lender if such notice is received at or before 2:00 P.M.
(Charlotte, North Carolina time) otherwise such payment shall be made at or
before 12:00 Noon (Charlotte, North Carolina time) on the Business Day next
succeeding the day such notice is received. If such Lender does not pay such
amount to the Issuing Lender in full upon such request, such Lender shall, on
demand, pay to the Administrative Agent for the account of the Issuing Lender
interest on the unpaid amount during the period from the date of such drawing
until such Lender pays such amount to the Issuing Lender in full at a rate per
annum equal to, if paid within two (2) Business Days of the date that such
Lender is required to make payments of such amount pursuant to the preceding
sentence, the Federal Funds Rate and thereafter at a rate equal to the Base
Rate. Each Lender's obligation to make such payment to the Issuing Lender, and
the right of the Issuing Lender to receive the same, shall be absolute and
unconditional, shall not be affected by any circumstance whatsoever and without
regard to the termination of this Credit Agreement or the Commitments hereunder,
the existence of a Default or Event of Default or the acceleration of the
obligations of the Borrower hereunder and shall be made without any offset,
abatement, withholding or reduction whatsoever. Simultaneously with the making
of each such payment by a Lender to the Issuing Lender, such Lender shall,
automatically and without any further action on the part of the Issuing Lender
or such Lender, acquire a participation in an amount equal to such payment
(excluding the portion of such payment constituting interest owing to the
Issuing Lender) in the related unreimbursed drawing portion of the LOC
Obligation and in the interest thereon and in the related LOC Documents, and
shall have a claim against the Borrower with respect thereto.
(e) Repayment with Revolving Loans. On any day on which the Borrower shall
------------------------------
have requested, or been deemed to have requested, a Revolving Loan advance to
reimburse a drawing under a Letter of Credit, the Administrative Agent shall
give notice to the Lenders that a Revolving Loan has been requested or deemed
requested by the Borrower to be made in connection with a drawing under a Letter
of Credit, in which case a Revolving Loan advance comprised of Base Rate Loans
(or Eurodollar Loans to the extent the Borrower has complied with the procedures
of Section 2.1(b)(i) with respect thereto) shall be immediately made to the
Borrower by all Lenders (notwithstanding any termination of the Commitments
pursuant to Section 9.2) pro rata based on the respective Commitment Percentages
--- ----
of the Lenders (determined before giving effect to any termination of the
Commitments pursuant to Section 9.2) and the proceeds thereof shall be paid
directly to the Issuing Lender for application to the respective LOC
Obligations. Each such Lender hereby irrevocably agrees to make its pro rata
share of each such Revolving Loan immediately upon any such request or deemed
request in the amount, in the manner and on the date specified in the preceding
sentence notwithstanding (i) the amount of such borrowing may not comply with
---------------
the minimum amount for advances of Revolving Loans otherwise required hereunder,
(ii) whether any conditions specified in Section 5.2 are then satisfied, (iii)
whether a Default or an Event
39
of Default then exists, (iv) failure for any such request or deemed request for
Revolving Loan to be made by the time otherwise required hereunder, (v) whether
the date of such borrowing is a date on which Revolving Loans are otherwise
permitted to be made hereunder or (vi) any termination of the Commitments
relating thereto immediately prior to or contemporaneously with such borrowing.
In the event that any Revolving Loan cannot for any reason be made on the date
otherwise required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to the
Borrower or any Credit Party), then each such Lender hereby agrees that it shall
forthwith purchase (as of the date such borrowing would otherwise have occurred,
but adjusted for any payments received from the Borrower on or after such date
and prior to such purchase) from the Issuing Lender such participation in the
outstanding LOC Obligations as shall be necessary to cause each such Lender to
share in such LOC Obligations ratably (based upon the respective Commitment
Percentages of the Lenders (determined before giving effect to any termination
of the Commitments pursuant to Section 9.2)), provided that in the event such
--------
payment is not made on the day of drawing, such Lender shall pay in addition to
the Issuing Lender interest on the amount of its unfunded Participation Interest
at a rate equal to, if paid within two (2) Business Days of the date of drawing,
the Federal Funds Rate, and thereafter at the Base Rate.
(f) Designation of other Credit Parties as Account Parties.
------------------------------------------------------
Notwithstanding anything to the contrary set forth in this Credit Agreement,
including without limitation Section 2.2(a) hereof, a Letter of Credit issued
hereunder may contain a statement to the effect that such Letter of Credit is
issued for the account of a Credit Party, provided that notwithstanding such
statement, the Borrower shall be the actual account party for all purposes of
this Credit Agreement for such Letter of Credit and such statement shall not
affect the Borrower's reimbursement obligations hereunder with respect to such
Letter of Credit.
(g) Renewal, Extension. The renewal or extension of any Letter of Credit
------------------
shall, for purposes hereof, be treated in all respects the same as the issuance
of a new Letter of Credit hereunder.
(h) Uniform Customs and Practices. The Issuing Lender may have the Letters
-----------------------------
of Credit be subject to The Uniform Customs and Practice for Documentary
Credits, as published as of the date of issue by the International Chamber of
Commerce (the "UCP"), in which case the UCP may be incorporated therein and
---
deemed in all respects to be a part thereof.
(i) Indemnification; Nature of Issuing Lender's Duties.
--------------------------------------------------
(i) In addition to its other obligations under this Section 2.2, the
Borrower hereby agrees to protect, indemnify, pay and save the Issuing
Lender harmless from
40
and against any and all claims, demands, liabilities, damages, losses,
costs, charges and expenses (including reasonable attorneys' fees) that the
Issuing Lender may incur or be subject to as a consequence, direct or
indirect, of (A) the issuance of any Letter of Credit or (B) the failure of
the Issuing Lender to honor a drawing under a 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 "Government Acts").
----------------
(ii) As between the Borrower and the Issuing Lender, the Borrower
shall assume all risks of the acts, omissions or misuse of any Letter of
Credit by the beneficiary thereof. The Issuing Lender shall not be
responsible: (A) for the form, validity, sufficiency, accuracy, genuineness
or legal effect of any document submitted by any party in connection with
the application for and issuance of any Letter of Credit, even if it should
in fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged; (B) for the validity or sufficiency of
any instrument transferring or assigning or purporting to transfer or
assign any Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (C) for 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; (D) for
any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under a Letter of Credit or of the proceeds
thereof; and (E) for any consequences arising from causes beyond the
control of the Issuing Lender, including, without limitation, any
Government Acts. None of the above shall affect, impair, or prevent the
vesting of the Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
the Issuing Lender, under or in connection with any Letter of Credit or the
related certificates, if taken or omitted in good faith, shall not put such
Issuing Lender under any resulting liability to the Borrower or any other
Credit Party. It is the intention of the parties that this Credit
Agreement shall be construed and applied to protect and indemnify the
Issuing Lender against any and all risks involved in the issuance of the
Letters of Credit, all of which risks are hereby assumed by the Borrower
(on behalf of itself and each of the other Credit Parties), including,
without limitation, any and all Government Acts. The Issuing Lender shall
not, in any way, be liable for any failure by the Issuing Lender or anyone
else to pay any drawing under any Letter of Credit as a result of any
Government Acts or any other cause beyond the control of the Issuing
Lender.
(iv) Nothing in this subsection (i) is intended to limit the
reimbursement obligations of the Borrower contained in subsection (d)
above. The obligations of the
41
Borrower under this subsection (i) shall survive the termination of this
Credit Agreement. No act or omissions of any current or prior beneficiary
of a Letter of Credit shall in any way affect or impair the rights of the
Issuing Lender to enforce any right, power or benefit under this Credit
Agreement.
(v) Notwithstanding anything to the contrary contained in this
subsection (i), the Borrower shall have no obligation to indemnify the
Issuing Lender in respect of any liability incurred by the Issuing Lender
(A) arising solely out of the gross negligence or willful misconduct of the
Issuing Lender, as determined by a court of competent jurisdiction, or (B)
caused by the Issuing Lender's failure to pay under any Letter of Credit
after presentation to it of a request strictly complying with the terms and
conditions of such Letter of Credit, as determined by a court of competent
jurisdiction, unless such payment is prohibited by any law, regulation,
court order or decree.
(j) Responsibility of Issuing Lender. It is expressly understood and agreed
--------------------------------
that the obligations of the Issuing Lender hereunder to the Lenders are only
those expressly set forth in this Credit Agreement and that the Issuing Lender
shall be entitled to assume that the conditions precedent set forth in Section
5.2 have been satisfied unless it shall have acquired actual knowledge that any
such condition precedent has not been satisfied; provided, however, that nothing
-------- -------
set forth in this Section 2.2 shall be deemed to prejudice the right of any
Lender to recover from the Issuing Lender any amounts made available by such
Lender to the Issuing Lender pursuant to this Section 2.2 in the event that it
is determined by a court of competent jurisdiction that the payment with respect
to a Letter of Credit constituted gross negligence or willful misconduct on the
part of the Issuing Lender.
(k) Conflict with LOC Documents. In the event of any conflict between this
---------------------------
Credit Agreement and any LOC Document (including any letter of credit
application), this Credit Agreement shall control.
2.3 Swingline Loan Subfacility.
--------------------------
(a) Swingline Commitment. Subject to the terms and conditions hereof and in
--------------------
reliance upon the representations and warranties set forth herein, the Swingline
Lender, in its individual capacity, agrees to make certain revolving credit
loans requested by the Borrower in Dollars to the Borrower (each a "Swingline
---------
Loan" and, collectively, the "Swingline Loans") from time to time from the
----
Closing Date until the Termination Date for the purposes hereinafter set forth;
provided, however, (i) the aggregate principal amount of Swingline Loans
-----------------
outstanding at any time shall not exceed TEN MILLION DOLLARS ($10,000,000) (the
"Swingline Committed Amount"), and (ii) with regard to the Lenders collectively,
---------------------------
the aggregate principal amount of Obligations outstanding at any time shall not
exceed the
42
Aggregate Revolving Committed Amount. Swingline Loans hereunder shall be made as
Base Rate Loans, and may be repaid or reborrowed in accordance with the
provisions hereof.
(b) Swingline Loan Advances.
-----------------------
(i) Notices; Disbursement. Whenever the Borrower desires a Swingline
---------------------
Loan advance hereunder it shall give written notice (or telephonic notice
promptly confirmed in writing) to the Swingline Lender not later than 1:00
P.M. (Charlotte, North Carolina time) on the Business Day of the requested
Swingline Loan advance. Each such notice shall be irrevocable and shall
specify (A) that a Swingline Loan advance is requested, (B) the date of the
requested Swingline Loan advance (which shall be a Business Day) and (C)
the principal amount of and Interest Period for the Swingline Loan advance
requested. Each Swingline Loan shall have such maturity date as the
Swingline Lender and the Borrower shall agree upon receipt by the Swingline
Lender of any such notice from the Borrower. The Swingline Lender shall
initiate the transfer of funds representing the Swingline Loan advance to
the Borrower by 3:00 P.M. (Charlotte, North Carolina time) on the Business
Day of the requested borrowing.
(ii) Minimum Amounts. Each Swingline Loan advance shall be in a
---------------
minimum principal amount of $100,000 and in integral multiples of $50,000
in excess thereof (or the remaining amount of the Swingline Committed
Amount, if less).
(iii) Repayment of Swingline Loans. The principal amount of
----------------------------
all Swingline Loans shall be due and payable on the earlier of (A) the
maturity date agreed to by the Swingline Lender and the Borrower with
respect to such Loan (which maturity date shall not be a date more than
thirty (30) Business Days from the date of advance thereof) or (B) the
Termination Date. The Swingline Lender may, at any time, in its sole
discretion, by written notice to the Borrower and the Lenders, demand
repayment of its Swingline Loans by way of a Revolving Loan advance, in
which case the Borrower shall be deemed to have requested a Revolving Loan
advance comprised solely of Base Rate Loans in the amount of such Swingline
Loans; provided, however, that any such demand shall be deemed to have been
-------- -------
given one Business Day prior to the Termination Date and on the date of the
occurrence of any Event of Default described in Section 9.1 and upon
acceleration of the indebtedness hereunder and the exercise of remedies in
accordance with the provisions of Section 9.2. Each Lender hereby
irrevocably agrees to make its pro rata share of each such Revolving Loan
in the amount, in the manner and on the date specified in the preceding
sentence notwithstanding (I) the amount of such borrowing may not comply
---------------
with the minimum amount for advances of Revolving Loans otherwise required
hereunder, (II) whether any conditions specified in Section 5.2 are then
satisfied, (III) whether a Default or an
43
Event of Default then exists, (IV) failure of any such request or deemed
request for Revolving Loan to be made by the time otherwise required
hereunder, (V) whether the date of such borrowing is a date on which
Revolving Loans are otherwise permitted to be made hereunder or (VI) any
termination of the Commitments relating thereto immediately prior to or
contemporaneously with such borrowing. In the event that any Revolving Loan
cannot for any reason be made on the date otherwise required above
(including, without limitation, as a result of the commencement of a
proceeding under the Bankruptcy Code with respect to the Borrower or any
other Credit Party), then each Lender hereby agrees that it shall forthwith
purchase (as of the date such borrowing would otherwise have occurred, but
adjusted for any payments received from the Borrower on or after such date
and prior to such purchase) from the Swingline Lender such Participation
Interests in the outstanding Swingline Loans as shall be necessary to cause
each such Lender to share in such Swingline Loans ratably based upon its
Commitment Percentage of the Revolving Committed Amount (determined before
giving effect to any termination of the Commitments pursuant to Section
3.4), provided that (A) all interest payable on the Swingline Loans
--------
shall be for the account of the Swingline Lender until the date as of which
the respective Participation Interest is purchased and (B) at the time any
purchase of Participation Interests pursuant to this sentence is actually
made, the purchasing Lender shall be required to pay to the Swingline
Lender, to the extent not paid to the Swingline Lender by the Borrower in
accordance with the terms of subsection (c)(ii) below, interest on the
principal amount of Participation Interests purchased for each day from and
including the day upon which such borrowing would otherwise have occurred
to but excluding the date of payment for such Participation Interests, at
the rate equal to the Federal Funds Rate.
(c) Interest on Swingline Loans.
---------------------------
Subject to the provisions of Section 3.1, each Swingline Loan shall bear
interest at a per annum rate (computed on the basis of the actual number of days
elapsed over a year of 365 days) equal to the Base Rate. Interest on Swingline
Loans shall be payable in arrears on each applicable Interest Payment Date (or
at such other times as may be specified herein), unless accelerated sooner
pursuant to Section 9.2.
(d) Swingline Note. The Swingline Loans shall be evidenced by the Revolving
--------------
Note.
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
----------------------------------------------
44
3.1 Default Rate.
------------
Upon the occurrence, and during the continuance, of an Event of Default, the
principal of and, to the extent permitted by law, interest on the Loans and any
other amounts owing hereunder or under the other Credit Documents shall bear
interest, payable on demand, at a per annum rate 2% greater than the rate which
would otherwise be applicable (or if no rate is applicable, whether in respect
of interest, fees or other amounts, then 2% greater than the Base Rate).
3.2 Extension and Conversion.
------------------------
Subject to the terms of Section 5.2, the Borrower shall have the option, on
any Business Day, to extend existing Loans into a subsequent permissible
Interest Period or to convert Loans into Loans of another interest rate type;
provided, however, that (i) except as provided in Section 3.8, Eurodollar Loans
-------- -------
may be converted into Base Rate Loans only on the last day of the Interest
Period applicable thereto, (ii) Eurodollar Loans may be extended, and Base Rate
Loans may be converted into Eurodollar Loans, only if no Default or Event of
Default is in existence on the date of extension or conversion, (iii) Loans
extended as, or converted into, Eurodollar Loans shall be subject to the terms
of the definition of "Interest Period" set forth in Section 1.1 and shall be in
---------------
such minimum amounts as provided in Section 2.1(b)(ii) , and (iv) any request
for extension or conversion of a Eurodollar Loan which shall fail to specify an
Interest Period shall be deemed to be a request for an Interest Period of one
month. Each such extension or conversion shall be effected by the Borrower by
giving a Notice of Extension/Conversion (or telephone notice promptly confirmed
in writing) to the Administrative Agent prior to 1:00 P.M. (Charlotte, North
Carolina time) on the third Business Day prior to the date of the proposed
extension or conversion, specifying the date of the proposed extension or
conversion, the Loans to be so extended or converted, the types of Loans into
which such Loans are to be converted and, if appropriate, the applicable
Interest Periods with respect thereto. Each request for extension or conversion
shall be irrevocable and shall constitute a representation and warranty by the
Borrower of the matters specified in subsections (a) through (e) of Section 5.2.
In the event the Borrower fails to request extension or conversion of any
Eurodollar Loan in accordance with this Section, or any such conversion or
extension is not permitted or required by this Section, then such Eurodollar
Loan shall be automatically converted into a Base Rate Loan at the end of the
Interest Period applicable thereto. The Administrative Agent shall give each
Lender notice as promptly as practicable of any such proposed extension or
conversion affecting any Loan.
3.3 Prepayments.
-----------
(a) Voluntary Prepayments. Revolving Loans may be repaid in whole or in part
---------------------
without premium or penalty; provided that (i) the Borrower shall give
--------
written notice
45
thereof to the Administrative Agent prior to 11:30 A.M. (Charlotte, North
Carolina time) on the Business Day of, in the case of the prepayment of Base
Rate Loans, and prior to 1:00 P.M. (Charlotte, North Carolina time) on the third
Business Day prior to, in the case of the prepayment of Eurodollar Loans, the
date of the prepayment, (ii) prepayments of Eurodollar Loans must be accompanied
by payment of any amounts owing under Section 3.11, and (iii) partial
prepayments shall be minimum principal amounts of $5,000,000, in the case of
Eurodollar Loans, and $1,000,000, in the case of Base Rate Loans, and in
integral multiples of $1,000,000 in excess thereof.
(b) Mandatory Prepayments. If at any time, (A) the aggregate principal amount
---------------------
of Obligations shall exceed the Aggregate Revolving Committed Amount, (B) the
aggregate amount of LOC Obligations shall exceed the LOC Committed Amount, (C)
the aggregate amount of Trade LOC Obligations shall exceed the Trade LOC
Committed Amount or (D) the aggregate amount of Swingline Loans shall exceed the
Swingline Committed Amount, the Borrower shall immediately make payment on the
Revolving Loans and/or to a cash collateral account in respect of the LOC
Obligations, in an amount sufficient to eliminate the deficiency.
(c) Application. Unless otherwise specified by the Borrower, prepayments made
-----------
hereunder shall be applied first to Swingline Loans, then to Revolving Loans
which are Base Rate Loans, then to Revolving Loans which are Eurodollar Loans in
direct order of Interest Period maturities and then to a cash collateral account
to secure LOC Obligations. Amounts prepaid hereunder may be reborrowed in
accordance with the provisions hereof.
3.4 Termination and Reduction of Commitments
----------------------------------------
(a) Voluntary Reductions. The Revolving Commitments may be terminated or
--------------------
permanently reduced in whole or in part upon three (3) Business Days' prior
written notice to the Administrative Agent, provided that (i) after giving
--------
effect to any voluntary reduction the aggregate amount of Obligations shall not
exceed the Aggregate Revolving Committed Amount, as reduced, and (ii) partial
reductions shall be in a minimum principal amount of $5,000,000, and in integral
multiples of $1,000,000 in excess thereof.
(b) Mandatory Reduction.
-------------------
(i) Asset Dispositions. The Revolving Commitments shall be permanently
------------------
reduced in an amount equal to one hundred percent (100%) of the Net
Proceeds received from Asset Dispositions to the extent (A) such Net
Proceeds are not reinvested in similar property or assets within 12 months
of the date of sale, lease, disposition, casualty, theft or loss which gave
rise to the Asset Disposition, and (B) the aggregate amount of such Net
Proceeds not reinvested in accordance with the
46
foregoing subsection (A) shall exceed $5,000,000 in any fiscal year.
(ii) Debt and Equity Transactions. The Revolving Commitments shall be
----------------------------
permanently reduced in an amount equal to fifty percent (50%) of the Net
Proceeds received from any Debt Transaction or Equity Transaction.
(iii) Maximum Mandatory Reductions. Notwithstanding the foregoing
----------------------------
provisions of this subsection (b), the mandatory commitment reduction under
clauses (i) and (ii) above shall become inapplicable once the Aggregate
Revolving Commitment Amount shall be permanently reduced to $100 million or
less.
(c) Termination. The Commitments hereunder shall terminate on the
-----------
Termination Date.
3.5 Fees.
----
(a) Commitment Fee. In consideration of the Revolving Commitments
--------------
hereunder, the Borrower agrees to pay to the Administrative Agent for the
ratable benefit of the Lenders a commitment fee (the "Commitment Fee") equal to
--------------
the Applicable Percentage per annum on the average daily unused amount of the
Revolving Committed Amount for the applicable period. The Commitment Fee shall
be payable quarterly in arrears on the 15th day following the last day of each
calendar quarter for the immediately preceding quarter (or portion thereof)
beginning with the first such date to occur after the Closing Date. For purposes
of computation of the Commitment Fee, Swingline Loans shall not be counted
toward or considered usage under the Revolving Loan facility.
(b) Letter of Credit Fees.
---------------------
(i) Standby Letter of Credit Fee. In consideration of the Standby LOC
----------------------------
Commitment hereunder, the Borrower agrees to pay to the Administrative
Agent for the ratable benefit of the Lenders a fee (the "Standby Letter of
-----------------
Credit Fee") equal to the Applicable Percentage per annum on the average
----------
daily maximum amount available to be drawn under Standby Letters of Credit
from the date of issuance to the date of expiration. The Standby Letter of
Credit Fee shall be payable quarterly in arrears on the 15th day following
the last day of each calendar quarter for the immediately preceding quarter
(or portion thereof) beginning with the first such date to occur after the
Closing Date.
(ii) Trade Letter of Credit Fee. In consideration of the Trade LOC
--------------------------
Commitment hereunder, the Borrower agrees to pay to the Administrative
Agent for the ratable benefit of the Lenders a fee (the "Trade Letter of
---------------
Credit Fee") equal to the
----------
47
Applicable Percentage per annum on the average daily maximum amount
available to be drawn under Trade Letters of Credit from the date of
issuance to the date of expiration. The Trade Letter of Credit Fee shall be
payable quarterly in arrears on the 15th day following the last day of each
calendar quarter for the immediately preceding quarter (or portion thereof)
beginning with the first such date to occur after the Closing Date.
(iii) Issuing Lender Fee. In addition to the Standby Letter
------------------
of Credit Fee and the Trade Letter of Credit Fee, the Borrower agrees to
pay to the Issuing Lender for its own account without sharing by the other
Lenders (A) a fronting and negotiation fee of 0.125% per annum on the
average daily maximum amount available to be drawn under Standby Letters of
Credit issued by it from the date of issuance to the date of expiration
payable quarterly in arrears, (B) a fronting and negotiation fee of 0.10%
on the maximum amount available to be drawn under Trade Letters of Credit
issued by it payable in advance on the date of issuance, and (C) customary
charges of the Issuing Lender with respect to the issuance, amendment,
transfer, administration, cancellation and conversion of, and drawings
under, such Letters of Credit (collectively, the "Issuing Lender Fees").
-------------------
(c) Administrative Agent's Fees. The Borrower agrees to pay to the
---------------------------
Administrative Agent, for its own account, an annual administrative fee and
such other fees, if any, referred to in the Administrative Agent's Fee
Letter (collectively, the "Administrative Agent's Fees").
---------------------------
3.6 Capital Adequacy.
----------------
If any Lender has determined, after the date hereof, that the adoption or
the becoming effective of, or any change in, or any change by any Governmental
Authority, central bank or comparable agency charged with the interpretation or
administration thereof in the interpretation or administration of, any
applicable law, rule or regulation regarding capital adequacy, or compliance by
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on such
Lender's capital or assets as a consequence of its commitments or obligations
hereunder to a level below that which such Lender could have achieved but for
such adoption, effectiveness, change or compliance (taking into consideration
such Lender's policies with respect to capital adequacy), then, upon notice from
such Lender to the Borrower, the Borrower shall be obligated to pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction. Each determination by any such Lender of amounts owing under this
Section shall, absent manifest error, be conclusive and binding on the parties
hereto.
48
3.7 Inability To Determine Interest Rate.
------------------------------------
If prior to the first day of any Interest Period, the Administrative Agent
shall have determined (which determination shall be conclusive and binding upon
the Borrower) that, by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurodollar Rate
for such Interest Period, the Administrative Agent shall give telecopy or
telephonic notice thereof to the Borrower and the Lenders as soon as practicable
thereafter (which notice shall be withdrawn the Administrative Agent whenever
such circumstances no longer exist). If such notice is given (a) any Eurodollar
Loans requested to be made on the first day of such Interest Period shall be
made as Base Rate Loans and (b) any Loans that were to have been converted on
the first day of such Interest Period to or continued as Eurodollar Loans shall
be converted to or continued as Base Rate Loans. Until such notice has been
withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made
or continued as such, nor shall the Borrower have the right to convert Base Rate
Loans to Eurodollar Loans.
3.8 Illegality.
----------
Notwithstanding any other provision herein, if the adoption of or any change
in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrower
and the Administrative Agent (which notice shall be withdrawn by such Lender
whenever such circumstances no longer exist), (b) the commitment of such Lender
hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert a Base Rate Loan to Eurodollar Loans shall forthwith be canceled and,
until such time as it shall no longer be unlawful for such Lender to make or
maintain Eurodollar Loans, such Lender shall then have a commitment only to make
a Base Rate Loan when a Eurodollar Loan is requested and (c) such Lender's Loans
then outstanding as Eurodollar Loans, if any, shall be converted automatically
to Base Rate Loans on the respective last days of the then current Interest
Periods with respect to such Loans or within such earlier period as required by
law. If any such conversion of a Eurodollar Loan occurs on a day which is not
the last day of the then current Interest Period with respect thereto, the
Borrower shall pay to such Lender such amounts, if any, as may be required
pursuant to Section 3.11.
3.9 Requirements of Law.
-------------------
If, after the date hereof, the adoption of or any change in any Requirement of
Law or in the interpretation or application thereof applicable to any Lender, or
compliance by any Lender with any request or directive (whether or not having
the force of law) from any central bank or other Governmental Authority, in each
case made subsequent to the Closing
49
Date (or, if later, the date on which such Lender becomes a Lender):
(a) shall subject such Lender to any tax of any kind whatsoever with
respect to any Letter of Credit, any Eurodollar Loans made by it or its
obligation to make Eurodollar Loans, or change the basis of taxation of
payments to such Lender in respect thereof (except for (i) Non-Excluded
Taxes covered by Section 3.10 (including Non-Excluded Taxes imposed solely
by reason of any failure of such Lender to comply with its obligations
under Section 3.10(b)) and (ii) changes in taxes measured by or imposed
upon the overall net income, or franchise tax (imposed in lieu of such net
income tax), of such Lender or its applicable lending office, branch, or
any affiliate thereof));
(b) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender which is not otherwise included in the determination
of the Eurodollar Rate hereunder; or
(c) shall impose on such Lender any other condition (excluding any tax
of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrower from such Lender,
through the Administrative Agent, in accordance herewith, the Borrower shall be
obligated to promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender for such increased cost or reduced amount
receivable, provided that, in any such case, the Borrower may elect to convert
--------
the Eurodollar Loans made by such Lender hereunder to Base Rate Loans by giving
the Administrative Agent at least one Business Day's notice of such election, in
which case the Borrower shall promptly pay to such Lender, upon demand, without
duplication, such amounts, if any, as may be required pursuant to Section 3.11.
If any Lender becomes entitled to claim any additional amounts pursuant to this
subsection, it shall provide prompt notice thereof to the Borrower, through the
Administrative Agent, certifying (x) that one of the events described in this
paragraph (a) has occurred and describing in reasonable detail the nature of
such event, (y) as to the increased cost or reduced amount resulting from such
event and (z) as to the additional amount demanded by such Lender and a
reasonably detailed explanation of the calculation thereof. Such a certificate
as to any additional amounts payable pursuant to this subsection submitted by
such Lender, through the Administrative Agent, to the Borrower shall be
conclusive and binding on the parties hereto in the absence of manifest error.
This
50
covenant shall survive the termination of this Credit Agreement and the
payment of the Loans and all other amounts payable hereunder.
3.10 Taxes.
-----
(a) Except as provided below in this subsection, all payments made by
the Borrower under this Credit Agreement and any Notes shall be made free
and clear of, and without deduction or withholding for or on account of,
any present or future income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any court, or
governmental body, agency or other official, excluding taxes measured by or
imposed upon the overall net income of any Lender or its applicable lending
office, or any branch or affiliate thereof, and all franchise taxes, branch
taxes, taxes on doing business or taxes on the overall capital or net worth
of any Lender or its applicable lending office, or any branch or affiliate
thereof, in each case imposed in lieu of net income taxes, imposed: (i) by
the jurisdiction under the laws of which such Lender, applicable lending
office, branch or affiliate is organized or is located, or in which its
principal executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii) by
reason of any connection between the jurisdiction imposing such tax and
such Lender, applicable lending office, branch or affiliate other than a
connection arising solely from such Lender having executed, delivered or
performed its obligations, or received payment under or enforced, this
Credit Agreement or any Notes. If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
------------
Taxes") are required to be withheld from any amounts payable to the
-----
Administrative Agent or any Lender hereunder or under any Notes, (A) the
amounts so payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative Agent or
such Lender (after payment of all Non-Excluded Taxes) interest or any such
other amounts payable hereunder at the rates or in the amounts specified in
this Credit Agreement and any Notes, provided, however, that the Borrower
-------- -------
shall be entitled to deduct and withhold any Non-Excluded Taxes and shall
not be required to increase any such amounts payable to any Lender that is
not organized under the laws of the United States of America or a state
thereof if such Lender fails to comply with the requirements of paragraph
(b) of this subsection whenever any Non-Excluded Taxes are payable by the
Borrower, and (B) as promptly as possible thereafter the Borrower shall
send to the Administrative Agent for its own account or for the account of
such Lender, as the case may be, a certified copy of an original official
receipt received by the Borrower showing payment thereof. If the Borrower
fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required
receipts or other required documentary evidence, the Borrower shall
indemnify the Administrative Agent and the Lenders for any incremental
taxes, interest or penalties that may become payable by the Administrative
Agent or any Lender as a result of any such failure. The agreements in
this subsection shall survive the termination of this Credit Agreement and
the
51
payment of the Loans and all other amounts payable hereunder.
(b) Each Lender that is not incorporated under the laws of the United
States of America or a state thereof shall:
(X)(i) on or before the date of any payment by the Borrower under this
Credit Agreement or Notes to such Lender, deliver to the Borrower and the
Administrative Agent (A) two (2) duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor applicable form,
as the case may be, certifying that it is entitled to receive payments
under this Credit Agreement and any Notes without deduction or withholding
of any United States federal income taxes and (B) an Internal Revenue
Service Form W-8 or W-9, or successor applicable form, as the case may be,
certifying that it is entitled to an exemption from United States backup
withholding tax;
(ii) deliver to the Borrower and the Administrative Agent two (2)
further copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete
such forms or certifications as may reasonably be requested by the Borrower
or the Administrative Agent; or
(Y) in the case of any such Lender that is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Internal Revenue Code, (i) represent
to the Borrower (for the benefit of the Borrower and the Administrative
Agent) that it is not a bank within the meaning of Section 881(c)(3)(A) of
the Internal Revenue Code, (ii) agree to furnish to the Borrower on or
before the date of any payment by the Borrower, with a copy to the
Administrative Agent two (2) accurate and complete original signed copies
of Internal Revenue Service Form W-8, or successor applicable form
certifying to such Lender's legal entitlement at the date of such
certificate to an exemption from U.S. withholding tax under the provisions
of Section 881(c) of the Internal Revenue Code with respect to payments to
be made under this Credit Agreement and any Notes (and to deliver to the
Borrower and the Administrative Agent two (2) further copies of such form
on or before the date it expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recently provided
form and, if necessary, obtain any extensions of time reasonably requested
by the Borrower or the Administrative Agent for filing and completing such
forms), and (iii) agree, to the extent legally entitled to do so, upon
reasonable request by the Borrower, to provide to
52
the Borrower (for the benefit of the Borrower and the Administrative Agent)
such other forms as may be reasonably required in order to establish the
legal entitlement of such Lender to an exemption from withholding with
respect to payments under this Credit Agreement and any Notes;
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes a Lender hereunder which renders all such
forms inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so advises the
Borrower and the Administrative Agent. Each Person that shall become a Lender
or a participant of a Lender pursuant to subsection 11.3 shall, upon the
effectiveness of the related transfer, be required to provide all of the forms,
certifications and statements required pursuant to this subsection, provided
--------
that in the case of a participant of a Lender the obligations of such
participant of a Lender pursuant to this subsection (b) shall be determined as
if the participant of a Lender were a Lender except that such participant of a
Lender shall furnish all such required forms, certifications and statements to
the Lender from which the related participation shall have been purchased.
3.11 Indemnity.
---------
The Borrower promises to indemnify each Lender and to hold each Lender
harmless from any loss or expense which such Lender may sustain or incur (other
than through such Lender's gross negligence or willful misconduct) as a
consequence of (a) default by the Borrower in making a borrowing of, conversion
into or continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Credit Agreement,
(b) default by the Borrower in making any prepayment of a Eurodollar Loan after
the Borrower has given a notice thereof in accordance with the provisions of
this Credit Agreement or (c) the making of a prepayment of Eurodollar Loans on a
day which is not the last day of an Interest Period with respect thereto. With
respect to Eurodollar Loans, such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest which would have accrued on
the amount so prepaid, or not so borrowed, converted or continued, for the
period from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of the applicable Interest Period (or, in the case of a
failure to borrow, convert or continue, the Interest Period that would have
commenced on the date of such failure) in each case at the applicable rate of
interest for such Loans provided for herein (excluding, however, the Applicable
Percentage included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) which would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank Eurodollar market. The covenants of the Borrower
set forth in this Section 3.11 shall survive the termination of this Credit
Agreement and the payment of the Loans and all other amounts payable hereunder.
53
3.12 Pro Rata Treatment.
------------------
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or prepayment of principal of any Loan
-----
(other than Swingline Loans) or reimbursement obligations arising from drawings
under Letters of Credit, each payment of interest on the Loans or reimbursement
obligations arising from drawings under Letters of Credit, each payment of
Commitment Fees, each payment of the Letter of Credit Fee, each reduction of the
Revolving Committed Amount and each conversion or extension of any Loan (other
than Swingline Loans), shall be allocated pro rata among the Lenders in
accordance with the respective principal amounts of their outstanding Loans and
Participation Interests.
(b) Advances. No Lender shall be responsible for the failure or delay by any
--------
other Lender in its obligation to make its ratable share of a borrowing
hereunder; provided, however, that the failure of any Lender to fulfill its
-------- -------
obligations hereunder shall not relieve any other Lender of its obligations
hereunder. Unless the Administrative Agent shall have been notified in writing
by any Lender prior to a borrowing that such Lender will not make the amount
that would constitute its ratable share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by such Lender within the time period specified therefor hereunder, such
Lender shall pay to the Administrative Agent, on demand, such amount with
interest thereon at a rate equal to the Federal Funds Rate for a period of two
(2) Business Days, and thereafter at the Base Rate, for the period until such
Lender makes such amount immediately available to the Administrative Agent. If
such Lender does not pay such amounts to the Administrative Agent forthwith upon
demand, the Administrative Agent may notify the Borrower and request the
Borrower to immediately pay such amount to the Administrative Agent with
interest at the Base Rate. A certificate of the Administrative Agent submitted
to any Lender with respect to any amounts owing under this subsection shall be
conclusive in the absence of manifest error.
3.13 Sharing of Payments.
-------------------
The Lenders agree among themselves that, in the event that any Lender shall
obtain payment in respect of any Loan, LOC Obligations or any other obligation
owing to such Lender under this Credit Agreement through the exercise of a right
of setoff, banker's lien or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or
54
otherwise, or by any other means, in excess of its pro rata share of such
payment as provided for in this Credit Agreement, such Lender shall promptly
purchase from the other Lenders a participation in such Loans, LOC Obligations
and other obligations in such amounts, and make such other adjustments from time
to time, as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this Credit
Agreement. The Lenders further agree among themselves that if payment to a
Lender obtained by such Lender through the exercise of a right of setoff,
banker's lien, counterclaim or other event as aforesaid shall be rescinded or
must otherwise be restored, each Lender which shall have shared the benefit of
such payment shall, by repurchase of a participation theretofore sold, return
its share of that benefit (together with its share of any accrued interest
payable with respect thereto) to each Lender whose payment shall have been
rescinded or otherwise restored. The Borrower agrees that any Lender so
purchasing such a participation may, to the fullest extent permitted by law,
exercise all rights of payment, including setoff, banker's lien or counterclaim,
with respect to such participation as fully as if such Lender were a holder of
such Loan, LOC Obligations or other obligation in the amount of such
participation. Except as otherwise expressly provided in this Credit Agreement,
if any Lender or the Administrative Agent shall fail to remit to the
Administrative Agent or any other Lender an amount payable by such Lender or the
Administrative Agent to the Administrative Agent or such other Lender pursuant
to this Credit Agreement on the date when such amount is due, such payments
shall be made together with interest thereon for each date from the date such
amount is due until the date such amount is paid to the Administrative Agent or
such other Lender at a rate per annum equal to the Federal Funds Rate. If under
any applicable bankruptcy, insolvency or other similar law, any Lender receives
a secured claim in lieu of a setoff to which this Section 3.13 applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders under this
Section 3.13 to share in the benefits of any recovery on such secured claim.
3.14 Payments, Computations, Etc.
----------------------------
(a) Except as otherwise specifically provided herein, all payments hereunder
shall be made to the Administrative Agent in Dollars in immediately available
funds, without setoff, deduction, counterclaim or withholding of any kind, at
the Administrative Agent's office specified in Section 11.1 not later than 2:00
P.M. (Charlotte, North Carolina time) on the date when due. Payments received
after such time shall be deemed to have been received on the next succeeding
Business Day. The Administrative Agent may (but shall not be obligated to) debit
the amount of any such payment which is not made by such time to any ordinary
deposit account of the Borrower maintained with the Administrative Agent (with
notice to the Borrower). The Borrower shall, at the time it makes any payment
under this Credit Agreement, specify to the Administrative Agent the Loans, LOC
Obligations, Fees, interest or other amounts payable by the Borrower hereunder
to which such payment is to be
55
applied (and in the event that it fails so to specify, or if such application
would be inconsistent with the terms hereof, the Administrative Agent shall
distribute such payment to the Lenders in such manner as the Administrative
Agent may determine to be appropriate in respect of obligations owing by the
Borrower hereunder, subject to the terms of Section 3.12(a)). The Administrative
Agent will distribute such payments to such Lenders, if any such payment is
received prior to 12:00 Noon (Charlotte, North Carolina time) on a Business Day
in like funds as received prior to the end of such Business Day and otherwise
the Administrative Agent will distribute such payment to such Lenders on the
next succeeding Business Day. Whenever any payment hereunder shall be stated to
be due on a day which is not a Business Day, the due date thereof shall be
extended to the next succeeding Business Day (subject to accrual of interest and
Fees for the period of such extension), except that in the case of Eurodollar
Loans, if the extension would cause the payment to be made in the next following
calendar month, then such payment shall instead be made on the next preceding
Business Day. Except as expressly provided otherwise herein, all computations of
interest and fees shall be made on the basis of the actual number of days
elapsed over a year of 360 days, except with respect to computation of interest
on Base Rate Loans which (unless the Base Rate is determined by reference to the
Federal Funds Rate) shall be calculated based on a year of 365 or 366 days, as
appropriate. Interest shall accrue from and include the date of borrowing, but
exclude the date of payment.
(b) Allocation of Payments After Event of Default. Notwithstanding any other
---------------------------------------------
provisions of this Credit Agreement to the contrary, after the occurrence and
during the continuance of an Event of Default, all amounts collected or received
by the Administrative Agent or any Lender on account of the Guaranteed
Obligations or any other amounts outstanding under any of the Credit Documents
shall be paid over or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation reasonable attorneys' fees) of the
Administrative Agent in connection with enforcing the rights of the Lenders
under the Credit Documents;
SECOND, to payment of any fees owed to the Administrative Agent;
THIRD, to the payment of all reasonable out-of-pocket costs and expenses
(including without limitation, reasonable attorneys' fees) of each of the
Lenders in connection with enforcing its rights under the Credit Documents
or otherwise with respect to the Obligations owing to such Lender;
FOURTH, to the payment of all accrued interest and fees on or in respect
of the Obligations;
FIFTH, to the payment of the outstanding principal amount of the
Guaranteed
56
Obligations (including the payment or cash collateralization of the
outstanding LOC Obligations);
SIXTH, to all other Obligations and other obligations which shall have
become due and payable under the Credit Documents or otherwise and not
repaid pursuant to clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may be
lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; and (ii) each of the Lenders shall receive an amount equal
to its pro rata share (based on the proportion that the then outstanding
Obligations held by such Lender bears to the aggregate then outstanding
Obligations) of amounts available to be applied pursuant to clauses "THIRD",
"FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent that any amounts
available for distribution pursuant to clause "FIFTH" above are attributable to
the issued but undrawn amount of outstanding Letters of Credit, such amounts
shall be held by the Administrative Agent in a cash collateral account and
applied (A) first, to reimburse the Issuing Lender for any drawings under such
Letters of Credit and (B) then, following the expiration of all Letters of
Credit, to all other obligations of the types described in clauses "FIFTH" and
"SIXTH" above in the manner provided in this Section 3.14(b).
3.15 Evidence of Debt.
----------------
(a) Each Lender shall maintain an account or accounts evidencing each
Loan made by such Lender to the Borrower from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Credit Agreement. Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update its
account or accounts from time to time, as necessary.
(b) The Administrative Agent shall maintain the Register pursuant to
Section 11.3(c) hereof, and a subaccount for each Lender, in which Register and
subaccounts (taken together) shall be recorded (i) the amount, type and Interest
Period of each such Loan hereunder, (ii) the amount of any principal or interest
due and payable or to become due and payable to each Lender hereunder and (iii)
the amount of any sum received by the Administrative Agent hereunder from or for
the account of the Borrower and each Lender's share thereof. The Administrative
Agent will make reasonable efforts to maintain the accuracy of the subaccounts
referred to in the preceding sentence and to promptly update such subaccounts
from time to time, as necessary.
57
(c) The entries made in the accounts, Register and subaccounts
maintained pursuant to subsection (b) of this Section 3.15 (and, if consistent
with the entries of the Administrative Agent, subsection (a)) shall be prima
facie evidence of the existence and amounts of the obligations of the Borrower
therein recorded; provided, however, that the failure of any Lender or the
-------- -------
Administrative Agent to maintain any such account, such Register or such
subaccount, as applicable, or any error therein, shall not in any manner affect
the obligation of the Borrower to repay the Loans made by such Lender in
accordance with the terms hereof.
3.16 Replacement of Lenders.
----------------------
If any Lender requests compensation or indemnification from the Borrower under
Sections 3.6, 3.9 or 3.10 hereof, the Borrower may, at its option, within
fifteen (15) days after receipt by the Borrower of written demand from the
affected Lender for payment of such compensation or indemnification, notify the
Administrative Agent and such affected Lender of its intention to replace the
affected Lender. So long as no Event of Default shall have occurred and be
continuing, the Borrower may obtain, at the Borrower's expense, a replacement
Lender for the affected Lender. If the Borrower obtains a replacement Lender
within ninety (90) days following notice of its intention to do so, the affected
Lender must sell and assign its Loans and any Revolving Commitment to such
replacement Lender pursuant to Section 11.3(b) hereof (without giving effect to
any requirement therein that the Administrative Agent consent thereto), for an
amount equal to the principal balance of all Revolving Loans held by the
affected Lender and all accrued interest and Fees with respect thereto through
the date of such sale, provided that the Borrower shall have paid to such
--------
affected Lender the compensation or indemnification that it is entitled to
receive under Sections 3.6, 3.9 or 3.10 hereof, through the date of such sale
and assignment. Notwithstanding the foregoing, the Borrower shall not have the
right to obtain a replacement Lender if the affected Lender rescinds its demand
for such compensation or indemnification within fifteen (15) days following its
receipt of the Borrower's notice of intention to replace such affected Lender.
Additionally, if the Borrower gives a notice to the Administrative Agent and an
affected Lender of its intention to replace such affected Lender and does not so
replace such affected Lender within ninety (90) days thereafter, the Borrower's
rights under this Section 3.16 shall terminate and the Borrower shall promptly
pay all compensation or indemnification demanded by such affected Lender
pursuant to Sections 3.6, 3.9 or 3.10 hereof.
SECTION 4
GUARANTY
--------
4.1 The Guarantee.
-------------
58
Each of the Guarantors hereby jointly and severally guarantees to each Lender,
to each Affiliate of a Lender that enters into a Hedging Agreement and to the
Administrative Agent as hereinafter provided the prompt payment of the
Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, a mandatory cash collateralization or
otherwise) strictly in accordance with the terms thereof. The Guarantors hereby
further agree that if any of the Guaranteed Obligations are not paid in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as mandatory cash collateralization or otherwise), the Guarantors
will, jointly and severally, promptly pay the same, without any demand or notice
whatsoever, and that in the case of any extension of time of payment or renewal
of any of the Guaranteed Obligations, the same will be promptly paid in full
when due (whether at extended maturity, as a mandatory prepayment, by
acceleration or otherwise) in accordance with the terms of such extension or
renewal.
Notwithstanding any provision to the contrary contained herein or in any other
of the Credit Documents or Hedging Agreements, to the extent the obligations of
a Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of each
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code).
4.2 Obligations Unconditional.
-------------------------
The obligations of the Guarantors under Section 4.1 hereof are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or Hedging
Agreements, or any other agreement or instrument referred to therein, or any
substitution, release or exchange of any other guarantee of or security for any
of the Guaranteed Obligations, and, to the fullest extent permitted by
applicable law, irrespective of any other circumstance whatsoever which might
otherwise constitute a legal or equitable discharge or defense of a surety or
guarantor, it being the intent of this Section 4.2 that the obligations of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that such Guarantor shall have no right of
subrogation, indemnity, reimbursement or contribution against the Borrower or
any other Guarantor of the Guaranteed Obligations for amounts paid under this
Guaranty until such time as the Lenders (and any Affiliates of Lenders entering
into Hedging Agreements) have been paid in full, all Commitments under the
Credit Agreement have been terminated and no Person or Governmental Authority
shall have any right to request any return or reimbursement of funds from the
Lenders in connection with monies received under the Credit Documents or Hedging
Agreements. Without limiting the generality of the foregoing, it is agreed
that, to the fullest extent permitted by law, the
59
occurrence of any one or more of the following shall not alter or impair the
liability of any Guarantor hereunder which shall remain absolute and
unconditional as described above:
(i) at any time or from time to time, without notice to any Guarantor,
the time for any performance of or compliance with any of the Guaranteed
Obligations shall be extended, or such performance or compliance shall be
waived;
(ii) any of the acts mentioned in any of the provisions of any of the
Credit Documents, any Hedging Agreement or any other agreement or
instrument referred to in the Credit Documents or Hedging Agreements shall
be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under any of the
Credit Documents, any Hedging Agreement or any other agreement or
instrument referred to in the Credit Documents or Hedging Agreements shall
be waived or any other guarantee of any of the Guaranteed Obligations or
any security therefor shall be released or exchanged in whole or in part or
otherwise dealt with;
(iv) any Lien granted to, or in favor of, the Administrative Agent or
any Lender or Lenders as security for any of the Guaranteed Obligations
shall fail to attach or be perfected; or
(v) any of the Guaranteed Obligations shall be determined to be void or
voidable (including, without limitation, for the benefit of any creditor of
any Guarantor) or shall be subordinated to the claims of any Person
(including, without limitation, any creditor of any Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Credit Documents, any Hedging Agreement or any other agreement or instrument
referred to in the Credit Documents or Hedging Agreements, or against any other
Person under any other guarantee of, or security for, any of the Guaranteed
Obligations.
4.3 Reinstatement.
-------------
The obligations of the Guarantors under this Section 4 shall be automatically
reinstated if and to the extent that for any reason any payment by or on behalf
of any Person in respect of the Guaranteed Obligations is rescinded or must be
otherwise restored by any holder of any
60
of the Guaranteed Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise, and each Guarantor agrees that it
will indemnify the Administrative Agent and each Lender on demand for all
reasonable costs and expenses (including, without limitation, reasonable fees
and expenses of counsel) incurred by the Administrative Agent or such Lender in
connection with such rescission or restoration, including any such reasonable
costs and expenses incurred in defending against any claim alleging that such
payment constituted a preference, fraudulent transfer or similar payment under
any bankruptcy, insolvency or similar law.
4.4 Certain Additional Waivers.
--------------------------
Without limiting the generality of the provisions of this Section 4, each
Guarantor hereby specifically waives the benefits of N.C. Gen. Stat. (S)(S) 26-7
through 26-9, inclusive. Each Guarantor further agrees that such Guarantor
shall have no right of recourse to security for the Guaranteed Obligations,
except through the exercise of the rights of subrogation pursuant to Section
4.2.
4.5 Remedies.
--------
The Guarantors agree that, to the fullest extent permitted by law, as between
the Guarantors, on the one hand, and the Administrative Agent and the Lenders,
on the other hand, the Guaranteed Obligations may be declared to be forthwith
due and payable as provided in Section 9.2 hereof (and shall be deemed to have
become automatically due and payable in the circumstances provided in said
Section 9.2) for purposes of Section 4.1 hereof notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing the
Guaranteed Obligations from becoming automatically due and payable) as against
any other Person and that, in the event of such declaration (or the Guaranteed
Obligations being deemed to have become automatically due and payable), the
Guaranteed Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors for purposes of said
Section 4.1.
4.6 Rights of Contribution.
----------------------
The Guarantors hereby agree, as among themselves, that if any Guarantor shall
become an Excess Funding Guarantor (as defined below), each other Guarantor
shall, on demand of such Excess Funding Guarantor (but subject to the succeeding
provisions of this Section 4.6), pay to such Excess Funding Guarantor an amount
equal to such Guarantor's Pro Rata Share (as defined below and determined, for
this purpose, without reference to the properties, assets, liabilities and debts
of such Excess Funding Guarantor) of such Excess Payment (as defined below).
The payment obligation of any Guarantor to any Excess Funding Guarantor under
this Section 4.6 shall be subordinate and subject in right of payment to the
prior payment in
61
full of the obligations of such Guarantor under the other provisions of this
Section 4, and such Excess Funding Guarantor shall not exercise any right or
remedy with respect to such excess until payment and satisfaction in full of all
of such obligations. For purposes hereof, (i) "Excess Funding Guarantor" shall
------------------------
mean, in respect of any obligations arising under the other provisions of this
Section 4 (hereafter, the "Guarantied Obligations"), a Guarantor that has paid
----------------------
an amount in excess of its Pro Rata Share of the Guarantied Obligations; (ii)
"Excess Payment" shall mean, in respect of any Guarantied Obligations, the
--------------
amount paid by an Excess Funding Guarantor in excess of its Pro Rata Share of
such Guarantied Obligations; and (iii) "Pro Rata Share", for the purposes of
--------------
this Section 4.6, shall mean, for any Guarantor, the ratio (expressed as a
percentage) of (a) the amount by which the aggregate present fair saleable value
of all of its assets and properties exceeds the amount of all debts and
liabilities of such Guarantor (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of such Guarantor
hereunder) to (b) the amount by which the aggregate present fair saleable value
of all assets and other properties of the Borrower and all of the Guarantors
exceeds the amount of all of the debts and liabilities (including contingent,
subordinated, unmatured, and unliquidated liabilities, but excluding the
obligations of the Borrower and the Guarantors hereunder) of the Borrower and
all of the Guarantors, all as of the Closing Date (if any Guarantor becomes a
party hereto subsequent to the Closing Date, then for the purposes of this
Section 4.6 such subsequent Guarantor shall be deemed to have been a Guarantor
as of the Closing Date and the information pertaining to, and only pertaining
to, such Guarantor as of the date such Guarantor became a Guarantor shall be
deemed true as of the Closing Date).
4.7 Continuing Guarantee.
--------------------
The guarantee in this Section 4 is a continuing guarantee, and shall apply to
all Guaranteed Obligations whenever arising.
SECTION 5
CONDITIONS
----------
5.1 Conditions to Closing.
---------------------
This Credit Agreement shall become effective, and the initial Extensions of
Credit may be made, upon the satisfaction of the following conditions precedent:
(a) Execution of Credit Agreement and Credit Documents. Receipt by the
--------------------------------------------------
Administrative Agent of (i) multiple counterparts of this Credit Agreement, (ii)
a Revolving Note for each Lender, and (iii) multiple counterparts of the Pledge
Agreement, in each case executed by a duly authorized officer of each party
thereto and in each case conforming to the
62
requirements of this Credit Agreement.
(b) Legal Opinions. Receipt of multiple counterparts of opinions of
--------------
counsel for the Credit Parties relating to the Credit Documents and the
transactions contemplated herein, in form and substance satisfactory to the
Administrative Agent and the Required Lenders.
(c) Financial Information. Receipt of financial information regarding the
---------------------
Borrower and its subsidiaries, as may be requested by, and in each case in form
and substance satisfactory to the Administrative Agent and the Lenders.
(d) Absence of Legal Proceedings. The absence of any action, suit,
----------------------------
investigation or proceeding pending in any court or before any arbitrator or
governmental instrumentality which could reasonably be expected to have a
Material Adverse Effect.
(e) Corporate Documents. Receipt of the following (or their equivalent)
-------------------
for each of the Credit Parties:
(i) Articles of Incorporation. Copies of the articles of
-------------------------
incorporation or charter documents certified to be true and complete as of
a recent date by the appropriate governmental authority of the state of its
incorporation.
(ii) Resolutions. Copies of resolutions of the Board of Directors
-----------
approving and adopting the respective Credit Documents, the transactions
contemplated therein and authorizing execution and delivery thereof,
certified by a secretary or assistant secretary as of the Closing Date to
be true and correct and in force and effect as of such date.
(iii) Bylaws. Copies of the bylaws certified by a secretary
------
or assistant secretary as of the Closing Date to be true and correct and in
force and effect as of such date.
(iv) Good Standing. Copies, where applicable, of certificates of good
-------------
standing, existence or its equivalent certified as of a recent date by the
appropriate governmental authorities of the state of incorporation and each
other state in which the failure to so qualify and be in good standing
would have a Material Adverse Effect.
(v) Officer's Certificate. An officer's certificate for each of the
---------------------
Credit Parties dated as of the Closing Date substantially in the form of
Schedule 5.1(e)(v) with appropriate insertions and attachments.
------------------
63
(f) Fees. Receipt of all fees, if any, owing pursuant to the Agents' Fee
----
Letter, Section 3.5 or otherwise.
(g) Subsection 5.2 Conditions. The conditions specified in Section 5.2
-------------------------
shall be satisfied.
(h) Additional Matters. All other documents and legal matters in connection
------------------
with the transactions contemplated by this Credit Agreement shall be reasonably
satisfactory in form and substance to the Agents and the Required Lenders.
5.2 Conditions to All Extensions of Credit.
--------------------------------------
The obligation of each Lender to make any Extension of Credit hereunder
(including the initial Extension of Credit to be made hereunder) is subject to
the satisfaction of the following conditions precedent on the date of making
such Extension of Credit:
(a) Representations and Warranties. The representations and warranties made
------------------------------
by the Credit Parties herein or in any other Credit Documents or which are
contained in any certificate furnished at any time under or in connection
herewith shall be true and correct in all material respects on and as of the
date of such Extension of Credit as if made on and as of such date (except for
those which expressly relate to an earlier date).
(b) No Default or Event of Default. No Default or Event of Default shall
------------------------------
have occurred and be continuing on such date or after giving effect to the
Extension of Credit to be made on such date unless such Default or Event of
Default shall have been waived in accordance with this Credit Agreement.
(c) Involuntary Bankruptcy or Insolvency. There shall not have been
------------------------------------
commenced against any of the Credit Parties an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or any case, proceeding or other action for the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its Property or for the
winding up or liquidation of its affairs, and shall remain undismissed,
undischarged or unbonded.
(d) No Material Adverse Effect. No circumstances, events or conditions
--------------------------
shall have occurred since the date of the audited financial statements
referenced in Section 6.1 which would have a Material Adverse Effect.
(e) Additional Conditions to Revolving Loans. If a Revolving Loan is made
----------------------------------------
pursuant to Section 2.1, all conditions set forth therein shall have been
satisfied.
64
(f) Additional Conditions to Letters of Credit. If such Extension of Credit
------------------------------------------
is made pursuant to Section 2.2, all conditions set forth therein shall have
been satisfied.
(g) Additional Conditions to Swingline Loans. If a Swingline Loan is made
----------------------------------------
pursuant to Section 2.3, all conditions set forth therein shall have been
satisfied.
Each request for Extension of Credit (including extensions and conversions)
and each acceptance by the Borrower of an Extension of Credit (including
extensions and conversions) shall be deemed to constitute a representation and
warranty by the Borrower as of the date of such Extension of Credit that the
applicable conditions in paragraphs (a), (b), (c) and (d), and in (e), (f) or
(g) of this subsection have been satisfied.
SECTION 6
REPRESENTATIONS AND WARRANTIES
------------------------------
To induce the Lenders to enter into this Credit Agreement and to make
Extensions of Credit herein provided for, each of the Credit Parties hereby
represents and warrants to the Administrative Agent and to each Lender that:
6.1 Financial Condition.
-------------------
Each of the financial statements described below (copies of which have
heretofore been provided to the Administrative Agent for distribution to the
Lenders), have been prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, are complete and correct in all material
respects and present fairly the financial condition and results from operations
of the entities and for the periods specified, subject in the case of interim
company-prepared statements to normal year-end adjustments and the absence of
footnotes:
(i) audited consolidated balance sheets of the Borrower and its
consolidated subsidiaries dated as of January 31, 1996, January 31, 1997
and January 31, 1998, together with related consolidated statements of
income and cash flows certified by Deloitte & Touche LLP, certified public
accountants; and
(ii) company-prepared consolidated balance sheets of the Borrower and
its consolidated subsidiaries dated as of April 30, 1998 and July 31, 1998,
together with related consolidated statements of income and cash flows.
6.2 No Changes or Restricted Payments.
---------------------------------
65
Since the date of the audited financial statements referenced in Section
6.1(i), (a) there has been no circumstance, development or event relating to or
affecting the members of the Consolidated Group which has had or would be
reasonably expected to have a Material Adverse Effect, and (b) except as
permitted herein, no Restricted Payments have been made or declared or are
contemplated by any members of the Consolidated Group.
6.3 Organization; Existence; Compliance with Law.
--------------------------------------------
Each of the members of the Consolidated Group (a) is duly organized, validly
existing in good standing under the laws of the jurisdiction of its
incorporation or organization, (b) has the corporate or other necessary power
and authority, and the legal right to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign entity and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification, other than in such jurisdictions where the failure to be so
qualified and in good standing would not, in the aggregate, have a Material
Adverse Effect, and (d) is in compliance with all Requirements of Law, except to
the extent that the failure to comply therewith would not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.
6.4 Power; Authorization; Enforceable Obligations.
---------------------------------------------
Each of the Credit Parties has the corporate or other necessary power and
authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party and has taken all necessary corporate or other
action to authorize the execution, delivery and performance by it of the Credit
Documents to which it is a party. No consent or authorization of, filing with,
notice to or other act by or in respect of, any Governmental Authority or any
other Person is required in connection with acceptance of Extensions of Credit
or the making of the guaranties hereunder or with the execution, delivery or
performance of any Credit Documents by the Credit Parties (other than those
which have been obtained, such filings as are required by the SEC and to fulfill
other reporting requirements with Governmental Authorities) or with the validity
or enforceability of any Credit Document against the Credit Parties (except such
filings as are necessary in connection with the perfection of the Liens created
by such Credit Documents). Each Credit Document to which it is a party
constitutes a legal, valid and binding obligation of such Credit Party
enforceable against such Credit Party in accordance with their respective terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
66
6.5 No Legal Bar.
------------
The execution, delivery and performance of the Credit Documents, the
borrowings hereunder and the use of the Extensions of Credit will not violate
any Requirement of Law or any Contractual Obligation of any member of the
Consolidated Group (except those as to which waivers or consents have been
obtained), and will not result in, or require, the creation or imposition of any
Lien on any of its respective properties or revenues pursuant to any Requirement
of Law or Contractual Obligation other than the Liens arising under or
contemplated in connection with the Credit Documents. No member of the
Consolidated Group is in default under or with respect to any of its Contractual
Obligations in any respect which would reasonably be expected to have a Material
Adverse Effect.
6.6 No Material Litigation.
----------------------
Except as set forth on Schedule 6.6, no claim, litigation, investigation or
------------
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the best knowledge of the Credit Parties, threatened by or against, any
members of the Consolidated Group or against any of their respective properties
or revenues which (a) relate to the Credit Documents or any of the transactions
contemplated hereby or thereby, or (b) if adversely determined, would reasonably
be expected to have a Material Adverse Effect.
6.7 No Default.
----------
No Default or Event of Default has occurred and is continuing.
6.8 Ownership of Property; Liens.
----------------------------
Each of members of the Consolidated Group has good record and marketable title
in fee simple to, or a valid leasehold interest in, all its material real
property, and good title to, or a valid leasehold interest in, all its other
material property, and none of such property is subject to any Lien, except for
Permitted Liens.
6.9 Intellectual Property.
---------------------
Each of the members of the Consolidated Group owns, or has the legal right to
use, all United States trademarks, tradenames, copyrights, technology, know-how
and processes, if any, necessary for each of them to conduct its business as
currently conducted (the "Intellectual Property") except for those the failure
---------------------
to own or have such legal right to use would not be reasonably expected to have
a Material Adverse Effect. No claim has been asserted and is pending by any
Person challenging or questioning the use of any such Intellectual Property or
the validity or effectiveness of any such Intellectual Property, nor does
67
any Credit Party know of any such claim, and the use of such Intellectual
Property by the members of the Consolidated Group does not infringe on the
rights of any Person, except for such claims and infringements that, in the
aggregate, would not be reasonably expected to have a Material Adverse Effect.
6.10 Taxes.
-----
Each of the members of the Consolidated Group has filed or caused to be filed
all United States federal income tax returns and all other material tax returns
which, to the best knowledge of the Credit Parties, are required to be filed and
has paid (a) all taxes shown to be due and payable on said returns or (b) all
taxes shown to be due and payable on any assessments of which it has received
notice made against it or any of its property and all other taxes, fees or other
charges imposed on it or any of its property by any Governmental Authority
(other than any (i) taxes, fees or other charges with respect to which the
failure to pay, in the aggregate, would not have a Material Adverse Effect or
(ii) taxes, fees or other charges the amount or validity of which are currently
being contested and with respect to which reserves in conformity with GAAP have
been provided on the books of such Person), and no tax Lien has been filed, and,
to the best knowledge of the Credit Parties, no claim is being asserted, with
respect to any such tax, fee or other charge.
6.11 ERISA
-----
Except as would not reasonably be expected to have a Material Adverse Effect:
(a) During the five-year period prior to the date on which this representation
is made or deemed made: (i) no ERISA Event has occurred, and, to the best
knowledge of the Credit Parties, no event or condition has occurred or exists as
a result of which any ERISA Event could reasonably be expected to occur, with
respect to any Plan; (ii) no "accumulated funding deficiency," as such term is
defined in Section 302 of ERISA and Section 412 of the Internal Revenue Code,
whether or not waived, has occurred with respect to any Plan; (iii) each Plan
has been maintained, operated, and funded in compliance with its own terms and
in material compliance with the provisions of ERISA, the Internal Revenue Code,
and any other applicable federal or state laws; and (iv) no lien in favor of the
PBGC or a Plan has arisen or is reasonably likely to arise on account of any
Plan.
(b) The actuarial present value of all "benefit liabilities" (as defined in
Section 4001(a)(16) of ERISA), whether or not vested, under each Single Employer
Plan, as of the last annual valuation date prior to the date on which this
representation is made or deemed made (determined, in each case, in accordance
with Financial Accounting Standards Board Statement 87, utilizing the actuarial
assumptions used in such Plan's most recent actuarial valuation report), did not
exceed as of such valuation date the fair market value of the assets
68
of such plan.
(c) No member of the Consolidated Group nor any ERISA Affiliate has incurred,
or, to the best knowledge of the Credit Parties, could be reasonably expected to
incur, any withdrawal liability under ERISA to any Multiemployer Plan or
Multiple Employer Plan. No member of the Consolidated Group nor any ERISA
Affiliate would become subject to any withdrawal liability under ERISA if any
member of the Consolidated Group or any ERISA Affiliate were to withdraw
completely from all Multiemployer Plans and Multiple Employer Plans as of the
valuation date most closely preceding the date on which this representation is
made or deemed made. No member of the Consolidated Group nor any ERISA Affiliate
has received any notification that any Multiemployer Plan is in reorganization
(within the meaning of Section 4241 of ERISA), is insolvent (within the meaning
of Section 4245 of ERISA), or has been terminated (within the meaning of Title
IV of ERISA), and no Multiemployer Plan is, to the best knowledge of the Credit
Parties, reasonably expected to be in reorganization, insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Internal Revenue Code) or breach of fiduciary responsibility
has occurred with respect to a Plan which has subjected or may subject any
member of the Consolidated Group or any ERISA Affiliate to any liability under
Sections 406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Internal
Revenue Code, or under any agreement or other instrument pursuant to which any
member of the Consolidated Group or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability.
(e) No member of the Consolidated Group nor any ERISA Affiliates has any
material liability with respect to "expected post-retirement benefit
obligations" within the meaning of the Financial Accounting Standards Board
Statement 106. Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the Internal
Revenue Code apply has been administered in compliance in all material respects
of such sections.
6.12 Governmental Regulations, Etc.
-----------------------------
(a) No part of the proceeds of the Extensions of Credit hereunder will be
used, directly or indirectly, for the purpose of purchasing or carrying any
"margin stock" within the meaning of Regulation U, or for the purpose of
purchasing or carrying or trading in any securities. If requested by any Lender
or the Administrative Agent, the Borrower will furnish to the Administrative
Agent and each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form U-1 referred to in said Regulation U. No indebtedness
being reduced or retired out of the proceeds of the Extensions of Credit
hereunder was or will be incurred for the purpose of purchasing or carrying any
margin stock within the meaning of
69
Regulation U or any "margin security" within the meaning of Regulation T.
"Margin stock" within the meanings of Regulation U does not constitute more than
25% of the value of the consolidated assets of the Borrower and its
Subsidiaries. None of the transactions contemplated by this Credit Agreement
(including, without limitation, the direct or indirect use of the proceeds of
the Loans) will violate or result in a violation of the Securities Act of 1933,
as amended, or the Securities Exchange Act of 1934, as amended, or regulations
issued pursuant thereto, or Regulation T, U or X.
(b) None of the members of the Consolidated Group is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act or
the Investment Company Act of 1940, each as amended. In addition, none of the
members of the Consolidated Group is (i) an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
and is not controlled by such a company, or (ii) a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a "holding
company" or of a "subsidiary" of a "holding company", within the meaning of the
Public Utility Holding Company Act of 1935, as amended.
(c) Each of the members of the Consolidated Group has obtained all material
licenses, permits, franchises or other governmental authorizations necessary to
the ownership of its respective Property and to the conduct of its business.
(d) None of the members of the Consolidated Group is in violation of any
applicable statute, regulation or ordinance of the United States of America, or
of any state, city, town, municipality, county or any other jurisdiction, or of
any agency thereof (including without limitation, environmental laws and
regulations), which violation could reasonably be expected to have a Material
Adverse Effect.
(e) Each of the members of the Consolidated Group is current with all material
reports and documents, if any, required to be filed with any state or federal
securities commission or similar agency and is in full compliance in all
material respects with all applicable rules and regulations of such commissions.
6.13 Subsidiaries.
------------
Set forth on Schedule 6.13 are all the Subsidiaries of the Borrower at the
-------------
Closing Date, the jurisdiction of their incorporation and the direct or indirect
ownership interest of the Borrower therein.
6.14 Purpose of Extensions of Credit.
-------------------------------
The Extensions of Credit will be used to refinance existing Indebtedness and
to finance
70
working capital, capital expenditures and other lawful corporate purposes.
6.15 Environmental Matters.
---------------------
Except as would not reasonably be expected to have a Material Adverse Effect:
(a) Each of the facilities and properties owned, leased or operated by the
members of the Consolidated Group (the "Subject Properties") and all
------------------
operations at the Subject Properties are in compliance with all applicable
Environmental Laws, and there is no violation of any Environmental Law with
respect to the Subject Properties or the businesses operated by the members of
the Consolidated Group (the "Businesses"), and, to the best knowledge of
----------
any Credit Party, there are no conditions relating to the Businesses or Subject
Properties that could give rise to liability under any applicable Environmental
Laws.
(b) To the best knowledge of any Credit Party, none of the Subject Properties
contains, or has previously contained, any Materials of Environmental Concern
at, on or under the Subject Properties in amounts or concentrations that
constitute or constituted a violation of, or could give rise to liability under,
Environmental Laws.
(c) None of the members of the Consolidated Group has received any written or
verbal notice of, or inquiry from any Governmental Authority regarding, any
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of the Subject Properties or the Businesses, nor does any member
of the Consolidated Group have knowledge or reason to believe that any such
notice will be received or is being threatened.
(d) Materials of Environmental Concern have not been transported or disposed
of from the Subject Properties, or generated, treated, stored or disposed of at,
on or under any of the Subject Properties or any other location, in each case by
or on behalf any members of the Consolidated Group in violation of, or in a
manner that would be reasonably likely to give rise to liability under, any
applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative action is pending
or, to the best knowledge of any Credit Party, threatened, under any
Environmental Law to which any member of the Consolidated Group is or will be
named as a party, nor are there any consent decrees or other decrees, consent
orders, administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with respect to
any member of the Consolidated Group, the Subject Properties or the Businesses.
(f) There has been no release or, threat of release of Materials of
Environmental Concern at or from the Subject Properties, or arising from or
related to the operations
71
(including, without limitation, disposal) of any member of the Consolidated
Group in connection with the Subject Properties or otherwise in connection with
the Businesses, in violation of or in amounts or in a manner that could give
rise to liability under Environmental Laws.
6.16 Year 2000 Compliance.
--------------------
The Borrower has (i) initiated a review and assessment of all areas within its
and each of its Subsidiaries' business and operations (including those affected
by suppliers, vendors and customers) that could be adversely affected by the
"Year 2000 Problem" (that is, the risk that computer applications used by the
-----------------
Borrower or any of its Subsidiaries (or suppliers, vendors and customers) may be
unable to recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999), (ii) developed a
plan and timeline for addressing the Year 2000 Problem on a timely basis, and
(iii) to date, implemented that plan in accordance with that timetable. Based
on the foregoing, the Borrower believes that all computer applications
(including those of its suppliers, vendors and customers) that are material to
its or any of its Subsidiaries' business and operations are reasonably expected
on a timely basis to be able to perform properly date-sensitive functions for
all dates before and after January 1, 2000 (that is, be "Year 2000 Compliant"),
-------------------
except to the extent that a failure to do so could not reasonably be expected to
have a Material Adverse Effect.
SECTION 7
AFFIRMATIVE COVENANTS
---------------------
Each of the Credit Parties covenants and agrees that on the Closing Date, and
so long as this Credit Agreement is in effect and until the Commitments have
been terminated, no Obligations remain outstanding and all amounts owing
hereunder or in connection herewith have been paid in full, each of the members
of the Consolidated Group party hereto shall:
7.1 Financial Statements.
--------------------
Furnish, or cause to be furnished, to the Administrative Agent and the
Lenders:
(a) Audited Financial Statements. As soon as available, but in any event
----------------------------
within 90 days after the end of each fiscal year, an audited consolidated
balance sheet of the Borrower and its subsidiaries as of the end of the
fiscal year and the related consolidated statements of income, retained
earnings, shareholders' equity and cash flows for the year, audited by
independent certified public accountants of nationally recognized standing,
setting forth in each case in comparative form the figures for the
72
previous year, reported without a "going concern" or like qualification or
exception, or qualification indicating that the scope of the audit was
inadequate to permit such independent certified public accountants to certify
such financial statements without such qualification.
(b) Company-Prepared Financial Statements. As soon as available, but in any
-------------------------------------
event within 45 days after the end of each of the first three fiscal
quarters, a company-prepared consolidated balance sheet of the Borrower and
its subsidiaries as of the end of the quarter and related company-prepared
consolidated statements of income, retained earnings, shareholders' equity and
cash flows for such quarterly period and for the fiscal year to date;
in each case setting forth in comparative form the consolidated figures for the
corresponding period or periods of the preceding fiscal year or the portion of
the fiscal year ending with such period, as applicable, in each case subject to
normal recurring year-end audit adjustments.
All such financial statements shall be complete and correct in all material
respects (subject, in the case of interim statements, to normal recurring year-
end audit adjustments and the absence of footnotes) and shall be prepared in
reasonable detail and, in the case of the annual and quarterly financial
statements provided in accordance with subsections (a) and (b) above, in
accordance with GAAP applied consistently throughout the periods reflected
therein and further accompanied by a description of, and an estimation of the
effect on the financial statements on account of, a change in the application of
accounting principles as provided in Section 1.3.
7.2 Certificates; Other Information.
-------------------------------
Furnish, or cause to be furnished, to the Administrative Agent and the
Lenders:
(a) Accountant's Certificate and Reports. Concurrently with the delivery of
------------------------------------
the financial statements referred to in subsection 7.1(a) above, a certificate
of the independent certified public accountants reporting on such financial
statements stating that in making the examination necessary therefor no
knowledge was obtained of any Default or Event of Default, except as specified
in such certificate.
(b) Officer's Compliance Certificate. Concurrently with the delivery of the
--------------------------------
financial statements referred to in Sections 7.1(a) and 7.1(b) above, a
certificate of a Responsible Officer stating that, to the best of such
Responsible Officer's knowledge and belief, (i) the financial statements fairly
present in all material respects the financial condition of the parties covered
by such financial statements, (ii) during such
73
period the members of the Consolidated Group have observed or performed in all
material respects the covenants and other agreements hereunder and under the
other Credit Documents relating to them, and satisfied in all material respects
the conditions, contained in this Credit Agreement to be observed, performed or
satisfied by them, and (iii) such Responsible Officer has obtained no knowledge
of any Default or Event of Default except as specified in such certificate. Such
certificate shall include the calculations required to indicate compliance with
Section 7.9. A form of Officer's Certificate is attached as Schedule 7.2(b).
---------------
(c) Accountants' Reports. Promptly upon receipt, a copy of any final (as
--------------------
distinguished from a preliminary or discussion draft) "management letter" or
other similar report submitted by independent accountants or financial
consultants to the members of the Consolidated Group in connection with any
annual, interim or special audit.
(d) Public Information. Within thirty days after the same are sent, copies of
------------------
all reports (other than those otherwise provided pursuant to subsection 7.1) and
other financial information which any member of the Consolidated Group sends to
its public stockholders, and within thirty days after the same are filed, copies
of all financial statements and non-confidential reports which any member of the
Consolidated Group may make to, or file with, the Securities and Exchange
Commission or any successor or analogous Governmental Authority.
(e) Other Information. Promptly, such additional financial and other
-----------------
information as the Administrative Agent, at the request of any Lender, may
from time to time reasonably request.
7.3 Notices.
-------
Give notice to the Administrative Agent (which shall promptly transmit such
notice to each Lender) of:
(a) Defaults. Immediately (and in any event within two (2) Business Days)
--------
after any Credit Party knows or has reason to know thereof, the occurrence
of any Default or Event of Default.
(b) Contractual Obligations. Promptly, the occurrence of any default or
-----------------------
event of default under any Contractual Obligation of any member of the
Consolidated Group which would reasonably be expected to have a Material Adverse
Effect.
(c) Legal Proceedings. Promptly, any litigation, or any investigation or
-----------------
74
proceeding (including without limitation, any environmental proceeding) known to
any member of the Consolidated Group, or any material development in respect
thereof, affecting any member of the Consolidated Group which, if adversely
determined, would reasonably be expected to have a Material Adverse Effect.
(d) ERISA. Promptly, after any Responsible Officer of the Borrower knows or
-----
has reason to know of (i) any event or condition, including, but not limited to,
any Reportable Event, that constitutes, or might reasonably lead to, an ERISA
Event; (ii) with respect to any Multiemployer Plan, the receipt of notice as
prescribed in ERISA or otherwise of any withdrawal liability assessed against
any of their ERISA Affiliates, or of a determination that any Multiemployer Plan
is in reorganization or insolvent (both within the meaning of Title IV of
ERISA); (iii) the failure to make full payment on or before the due date
(including extensions) thereof of all amounts which the members of the
Consolidated Group or any ERISA Affiliate are required to contribute to each
Plan pursuant to its terms and as required to meet the minimum funding standard
set forth in ERISA and the Internal Revenue Code with respect; or (iv) any
change in the funding status of any Plan that reasonably could be expected to
have a Material Adverse Effect; together with a description of any such event or
condition or a copy of any such notice and a statement by the chief financial
officer of the Borrower briefly setting forth the details regarding such event,
condition, or notice, and the action, if any, which has been or is being taken
or is proposed to be taken by the Credit Parties with respect thereto. Promptly
upon request, the members of the Consolidated Group shall furnish the
Administrative Agent and the Lenders with such additional information concerning
any Plan as may be reasonably requested, including, but not limited to, copies
of each annual report/return (Form 5500 series), as well as all schedules and
attachments thereto required to be filed with the Department of Labor and/or the
Internal Revenue Service pursuant to ERISA and the Internal Revenue Code,
respectively, for each "plan year" (within the meaning of Section 3(39) of
ERISA).
(e) Other. Promptly, any other development or event which a Responsible
-----
Officer of the Borrower determines could reasonably be expected to have a
Material Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the relevant Credit Parties propose
to take with respect thereto.
7.4 Payment of Obligations.
----------------------
Pay, discharge or otherwise satisfy at or before maturity or before they
become
75
delinquent, as the case may be, in accordance with prudent business practice
(subject, where applicable, to specified grace periods) all material obligations
of each member of the Consolidated Group of whatever nature and any additional
costs that are imposed as a result of any failure to so pay, discharge or
otherwise satisfy such obligations, except when the amount or validity of such
obligations and costs is currently being contested in good faith by appropriate
proceedings and reserves, if applicable, in conformity with GAAP with respect
thereto have been provided on the books of the Consolidated Group, as the case
may be.
7.5 Conduct of Business and Maintenance of Existence.
------------------------------------------------
Continue to engage in business of the same general type as now conducted by it
on the date hereof and similar or related businesses with, and preserve, renew
and keep in full force and effect its corporate existence and take all
reasonable action to maintain all rights, privileges, licenses and franchises
necessary or desirable in the normal conduct of its business; comply with all
Contractual Obligations and Requirements of Law applicable to it except to the
extent that failure to comply therewith would not, in the aggregate, have a
Material Adverse Effect.
7.6 Maintenance of Property; Insurance.
----------------------------------
Keep all material property useful and necessary in its business in reasonably
good working order and condition (ordinary wear and tear excepted); maintain
with financially sound and reputable insurance companies casualty, liability and
such other insurance (which may include plans of self-insurance) with such
coverage and deductibles, and in such amounts as may be consistent with prudent
business practice and in any event consistent with normal industry practice
(except to any greater extent as may be required by the terms of any of the
other Credit Documents); and furnish to the Administrative Agent, upon written
request, full information as to the insurance carried.
7.7 Inspection of Property; Books and Records; Discussions.
------------------------------------------------------
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its businesses and activities; and
permit, during regular business hours and upon reasonable notice by the
Administrative Agent, the Administrative Agent to visit and inspect any of its
properties and examine and make abstracts (including photocopies) from any of
its books and records (other than materials protected by the attorney-client
privilege and materials which the Credit Parties may not disclose without
violation of a confidentiality obligation binding upon them) at any reasonable
time, and to discuss the business, operations, properties and financial and
other condition of the members of the Consolidated Group with officers and
employees of the members of the Consolidated Group
76
and with their independent certified public accountants. The cost of the
inspection referred to in the preceding sentence shall be for the account of the
Lenders unless an Event of Default has occurred and is continuing, in which case
the cost of such inspection shall be for the account of the Credit Parties.
7.8 Environmental Laws.
------------------
(a) Comply in all material respects with, and take reasonable actions to
ensure compliance in all material respects by all tenants and subtenants, if
any, with, all applicable Environmental Laws and obtain and comply in all
material respects with and maintain, and take reasonable actions to ensure that
all tenants and subtenants obtain and comply in all material respects with and
maintain, any and all licenses, approvals, notifications, registrations or
permits required by applicable Environmental Laws except to the extent that
failure to do so would not reasonably be expected to have a Material Adverse
Effect;
(b) Conduct and complete all investigations, studies, sampling and testing,
and all remedial, removal and other actions required under Environmental Laws
and promptly comply in all material respects with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws except
to the extent that the same are being contested in good faith by appropriate
proceedings and the failure to do or the pendency of such proceedings would not
reasonably be expected to have a Material Adverse Effect; and
(c) Defend, indemnify and hold harmless the Administrative Agent and the
Lenders, and their respective employees, agents, officers and directors, from
and against any and all claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the members of the Consolidated Group or the
Subject Properties, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable
attorney's and consultant's fees, investigation and laboratory fees, response
costs, court costs and litigation expenses, except to the extent that any of the
foregoing arise out of the gross negligence or willful misconduct of the party
seeking indemnification therefor. The agreements in this paragraph shall survive
repayment of the Loans and all other amounts payable hereunder, and termination
of the Commitments.
7.9 Financial Covenants.
-------------------
Comply with the following financial covenants:
(a) Consolidated Leverage Ratio. As of the end of each fiscal quarter, the
---------------------------
Consolidated Leverage Ratio shall not be greater than 3.0:1.0.
77
(b) Consolidated Fixed Charge Coverage Ratio. As of the end of each fiscal
----------------------------------------
quarter, the Consolidated Fixed Charge Coverage Ratio shall not be less
than 1.75:1.0.
(c) Consolidated Tangible Net Worth. Consolidated Tangible Net Worth shall at
-------------------------------
no time be less than the sum of $230,000,000 plus on the last day of each
----
fiscal quarter to occur after the Closing Date, 50% of Consolidated Net
Income for the fiscal quarter then ended, such increases to be cumulative,
plus 100% of the net proceeds from Equity Transactions occurring after the
----
Closing Date.
(d) Consolidated Funded Debt to Capitalization Ratio. Consolidated Funded Debt
------------------------------------------------
to Capitalization Ratio shall at no time be greater than 0.50:1.0.
(e) Capital Expenditures. The aggregate amount of Capital Expenditures for the
--------------------
Consolidated Group will not exceed in any fiscal year an amount equal to the
amount shown below:
(i) In the event the Borrower shall have completed by October 31, 1999,
an issuance of convertible Subordinated Debt of at least $100 million in
principal amount or an issuance of equity of at least $50 million in gross
proceeds:
Fiscal Year Ending
------------------
January 31, 2000 $65,000,000
January 31, 2001 and $72,000,000
each fiscal year thereafter
(ii) Otherwise, for the fiscal year ending January 31, 2000 and each
fiscal year thereafter, $25,000,000 or such greater amount as may be agreed
in writing by the Required Lenders.
7.10 Administrative Fees.
-------------------
Pay to the Administrative Agent the Administrative Agent's Fees and comply
with the other agreements provided for in the Administrative Agent's Fee Letter.
7.11 Additional Guaranties and Stock Pledges.
---------------------------------------
(a) Domestic Subsidiaries. Where Domestic Subsidiaries of the Borrower which
---------------------
are not Credit Parties hereunder (the "Non-Guarantor Subsidiaries") shall
--------------------------
at any time constitute more than (the "Threshold Requirement"):
---------------------
78
(i) in any instance for any such Non-Guarantor Subsidiary, five percent
(5%) of consolidated assets for the Consolidated Group or five percent (5%)
of consolidated revenues for the Consolidated Group, or
(ii) in the aggregate for all such Non-Guarantor Subsidiaries, ten
percent (10%) of consolidated assets for the Consolidated Group or ten
percent (10%) of consolidated revenues for the Consolidated Group,
then the Borrower shall promptly (but in any event within thirty (30) days) (i)
notify the Administrative Agent thereof, (ii) cause such Domestic Subsidiary or
Subsidiaries to become a Guarantor by execution of a Joinder Agreement, such
that immediately after joinder as a Guarantor, the remaining Non-Guarantor
Subsidiaries shall not in any instance, or collectively, exceed the Threshold
Requirement, (iii) deliver with the Joinder Agreement, supporting resolutions,
incumbency certificates, corporate formation and organizational documentation
and opinions of counsel as the Administrative Agent may reasonably request, and
(iv) deliver stock certificates and related pledge agreements or pledge joinder
agreements evidencing the pledge of 100% of the Voting Stock of all Domestic
Subsidiaries (whether or not they are Guarantors), together in each case with
undated stock transfer powers executed in blank.
(b) Foreign Subsidiaries. At any time any Person becomes a Foreign Subsidiary,
--------------------
the Company will promptly (but in any event within thirty (30) days) (i) notify
the Administrative Agent thereof, (ii) cause delivery of supporting resolutions,
incumbency certificates, corporation formation and organizational documentation
and opinions of counsel as the Administrative Agent may reasonably request, and
(iii) cause delivery of stock certificates (where required for perfection under
local law) and a related pledge agreement or pledge joinder agreement evidencing
the pledge of 66% of the Voting Stock and 100% of the non-Voting Stock of such
Foreign Subsidiary, together in each case with undated stock transfer powers
executed in blank.
7.12 Ownership of Subsidiaries.
-------------------------
Except to the extent otherwise permitted in Section 8.6, the Borrower shall,
directly or indirectly, own at all times 100% of the Voting Stock of each of its
Subsidiaries.
7.13 Use of Proceeds.
---------------
Extensions of Credit will be used solely for the purposes provided in Section
6.14.
7.14 Year 2000 Compatibility.
-----------------------
79
Take all action necessary to assure that its computer based systems are
able to operate and effectively process data including dates on and after
January 1, 2000, and, at the reasonable request of the Administrative Agent or
the Required Lenders, provide evidence to the Lenders of such year 2000
compatibility.
SECTION 8
NEGATIVE COVENANTS
Each of the Credit Parties covenants and agrees that on the Closing Date,
and so long as this Credit Agreement is in effect and until the Commitments have
been terminated, no Obligations remain outstanding and all amounts owing
hereunder or in connection herewith, have been paid in full, no member of the
Consolidated Group shall:
8.1 Indebtedness.
------------
Contract, create, incur, assume or permit to exist any Indebtedness,
except:
(a) Indebtedness arising or existing under this Credit Agreement and
the other Credit Documents;
(b) Indebtedness set forth in Schedule 8.1, and renewals, refinancings
------------
and extensions thereof on terms and conditions no less favorable than for
such existing Indebtedness;
(c) purchase money Indebtedness (including Capital Lease Obligations
and term debt obligations) extended by General Electric Capital Corporation
or any of its Affiliates in an aggregate outstanding principal amount not
to exceed $30,000,000 at any time;
(d) purchase money Indebtedness (including Capital Lease Obligations
and mortgage obligations) incurred to provide all or a portion of the
purchase price or costs of construction of an asset or, in the case of a
sale/leaseback transaction as described in Section 8.10, to finance the
value of an asset owned by a member of the Consolidated Group, provided
--------
that (i) such Indebtedness when incurred shall not exceed the purchase
price or cost of construction of such asset or, in the case of a
sale/leaseback transaction, the fair market value of such asset, (ii) no
such Indebtedness shall be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of such refinancing,
and (iii) the total amount of all such Indebtedness shall not exceed
$20,000,000 at any time outstanding;
80
(e) Indebtedness and obligations owing under interest rate protection
agreements relating to the Obligations hereunder and under interest rate,
commodities and foreign currency exchange protection agreements entered
into in the ordinary course of business to manage existing or anticipated
risks and not for speculative purposes;
(f) unsecured intercompany Indebtedness owing by a member of the
Consolidated Group to another member of the Consolidated Group (subject,
however, to the limitations of Section 8.4 in the case of the member of the
Consolidated Group extending the intercompany loan, advance or credit);
(g) other senior unsecured Indebtedness of the Borrower of up to
$5,000,000 in the aggregate at any time outstanding;
(h) Support Obligations of Indebtedness permitted under this Section
8.1; and
(i) Subordinated Debt of the Borrower, provided that, on a Pro Forma
Basis, the incurrence of such Subordinated Debt shall not result in a
Default or Event of Default.
8.2 Liens.
-----
Contract, create, incur, assume or permit to exist any Lien with respect to
any of their respective property or assets of any kind (whether real or
personal, tangible or intangible), whether now owned or hereafter acquired,
except for Permitted Liens.
8.3 Consolidation, Merger, Sale or Purchase of Assets, etc.
------------------------------------------------------
(a) Enter into a transaction of merger or consolidation, unless (A) if
------
the Borrower is a party thereto, the Borrower shall be the surviving
corporation, (B) in any other case, the surviving corporation shall be a
Guarantor or the surviving corporation shall be Domestic Subsidiary and such
Domestic Subsidiary shall become a Guarantor hereunder as an Additional Credit
Party pursuant to Section 7.11 concurrently therewith, (C) no Default or Event
of Default shall exist either immediately prior to or immediately after giving
effect thereto and (D) in the case of a transaction of merger or consolidation
with any Person which is not a Consolidated Party, the provisions of subsection
(c) of this Section 8.3 shall be complied with
(b) Sell, lease, transfer or otherwise dispose of assets, property
and/or operations (including any sale-leaseback transaction, but excluding the
sale of inventory in the
81
ordinary course of business), other than to another Credit Party, which
(i) in any instance (including any series of related
transactions) shall constitute more than five percent (5%) of Consolidated
Assets at the end of the immediately preceding fiscal year or five percent
(5%) of Consolidated EBITDA for the immediately preceding fiscal year, or
(ii) in the aggregate in any fiscal year shall constitute more
than ten percent (10%) of Consolidated Assets at the end of the immediately
preceding fiscal year or ten percent (10%) Consolidated EBITDA for the
immediately preceding fiscal year, and
(iii) no Default or Event of Default would exist after giving
effect thereto on a Pro Forma Basis.
(c) Acquire all or any portion of the capital stock or other ownership
interest in any Person which is not a Subsidiary or all or any substantial
portion of the assets, property and/or operations of a Person which is not a
Subsidiary, unless
------
(i) in the case of an acquisition of capital stock or other
ownership interest and after giving effect thereto such Person will not be
a Subsidiary, then such acquisition will not cause a violation of Section
8.4;
(ii) in the case of an acquisition of capital stock or other
ownership interest and after giving effect thereto such Person will be a
Subsidiary, or in the case of an acquisition of assets, property and/or
operations, then
(A) the total cash consideration paid in connection with any
such acquisition (or series of related transactions) shall not exceed
in any instance $25 million (including Indebtedness assumed and the
fair value of assets transferred by the Borrower in connection
therewith);
(B) the total cash consideration paid in connection with all
such acquisitions shall not exceed in any fiscal year $50 million
(including Indebtedness assumed and the fair value of assets
transferred by the Borrower in connection therewith) plus, for fiscal
----
years occurring after the current fiscal year, the unused portions
from the immediately preceding fiscal year (without giving effect to
any carry-over amounts from prior years);
(C) the Board of Directors of the Person which is the
subject of the acquisition shall have approved the acquisition; and
82
(D) no Default or Event of Default would exist after giving
effect thereto on a Pro Forma Basis.
(d) In the case of the Borrower and any Subsidiary which is not
wholly-owned, liquidate, wind-up or dissolve, whether voluntarily or
involuntarily (or suffer to permit any such liquidation or dissolution).
(e) Alter the character of their business in any material respect from
that conducted as of the Closing Date and similar or related businesses.
8.4 Advances, Investments and Loans.
-------------------------------
Lend money or extend credit or make advances to any Person, or purchase or
acquire any stock, obligations or securities of, or any other interest in, or
make any capital contribution to, or otherwise make an Investment in, any Person
except for Permitted Investments.
8.5 Transactions with Affiliates.
----------------------------
Enter into or permit to exist any transaction or series of transactions,
whether or not in the ordinary course of business, with any officer, director,
shareholder or Affiliate other than (i) transactions permitted by Section 8.1,
Section 8.3(b), Section 8.4 or Section 8.9, (ii) customary fees and expenses
paid to directors, (iii) transactions pursuant to agreements existing as of the
Closing Date and set forth on Schedule 8.5 hereto and (iv) where such
------------
transactions are on terms and conditions substantially as favorable as would be
obtainable in a comparable arm's-length transaction with a Person other than an
officer, director, shareholder or Affiliate.
8.6 Ownership of Equity Interests.
-----------------------------
Issue, sell, transfer, pledge or otherwise dispose of any partnership
interests, shares of capital stock or other equity or ownership interests
("Equity Interests") in any member of the Consolidated Group other than the
----------------
Borrower, except (i) issuance, sale or transfer of Equity Interests to a Credit
Party by a Subsidiary of such Credit Party, (ii) in connection with a
transaction permitted by Section 8.3, and (iii) as needed to qualify directors
under applicable law.
8.7 Fiscal Year.
-----------
Change its fiscal year from a January 31 fiscal year end.
83
8.8 Prepayments of Indebtedness, etc.
---------------------------------
(a) After the issuance thereof, amend or modify (or permit the amendment or
modification of), the terms of any other Indebtedness in a manner adverse to the
interests of the Lenders (including specifically shortening any maturity or
average life to maturity or requiring any payment sooner than previously
scheduled or increasing the interest rate or fees applicable thereto);
(b) Make any prepayment, redemption, defeasance or acquisition for value of
(including without limitation, by way of depositing money or securities with the
trustee with respect thereto before due for the purpose of paying when due), or
refund, refinance or exchange, any Funded Debt (other than intercompany
Indebtedness permitted hereunder), other than (i) regularly scheduled payments
of principal and interest on such Funded Debt and (ii) so long as no Default or
Event of Default would exist after giving effect thereto on a Pro Forma Basis,
prepayments, redemptions, defeasances and acquisitions for value which shall not
exceed $5 million in the aggregate during the term of this Credit Agreement.
8.9 Restricted Payments.
-------------------
Make or permit any Restricted Payments, unless and to the extent that no
Default or Event of Default shall exist immediately prior or after giving effect
thereto on a Pro Forma Basis.
8.10 Sale Leasebacks.
---------------
Except as permitted pursuant to Sections 8.1(c) and 8.1(d) hereof, directly
or indirectly, become or remain liable as lessee or as guarantor or other surety
with respect to any lease, whether an Operating Lease or a Capital Lease, of any
Property (whether real or personal or mixed), whether now owned or hereafter
acquired, (i) which such Person has sold or transferred or is to sell or
transfer to any other Person other than a Credit Party or (ii) which such Person
intends to use for substantially the same purpose as any other Property which
has been sold or is to be sold or transferred by such Person to any other Person
in connection with such lease.
8.11 Limitations on Restricted Actions.
---------------------------------
Directly or indirectly, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction on the ability of any such
Person to (a) pay dividends or make any other distributions to any Credit Party
on its capital stock or with respect to any other interest or participation in,
or measured by, its profits, (b) pay any Indebtedness or other
84
obligation owed to any Credit Party, (c) make loans or advances to any Credit
Party, (d) sell, lease or transfer any of its properties or assets to any Credit
Party, (e) ▇▇▇▇▇ ▇ ▇▇▇▇ on its properties or assets whether now owned or
hereafter acquired or (f) act as a Guarantor and pledge its assets pursuant to
the Credit Documents or any renewals, refinancings, exchanges, refundings or
extension thereof, except (in respect of any of the matters referred to in
clauses (a)-(d) above) for such encumbrances or restrictions existing under or
by reason of (i) this Credit Agreement and the other Credit Documents or (ii)
applicable law.
8.12 No Further Negative Pledges.
---------------------------
Except with respect to prohibitions against other encumbrances on specific
Property encumbered to secure payment of particular Indebtedness (which
Indebtedness relates solely to such specific Property, and improvements and
accretions thereto, and is otherwise permitted hereby), no member of the
Consolidated Group will enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the creation or assumption of any Lien upon
its properties or assets, whether now owned or hereafter acquired, or requiring
the grant of any security for such obligation if security is given for some
other obligation.
SECTION 9
EVENTS OF DEFAULT
-----------------
9.1 Events of Default.
-----------------
An Event of Default shall exist upon the occurrence of any of the following
specified events (each an "Event of Default"):
----------------
(a) Payment. Any Credit Party shall
-------
(i) default in the payment when due of any principal of any of the
Loans or of any reimbursement obligations arising from drawings under
Letters of Credit, or
(ii) default, and such defaults shall continue for three (3) or more
Business Days, in the payment when due of any interest on the Loans or any
interest on any reimbursement obligations arising from drawings under
Letters of Credit, or of any Fees or other amounts owing hereunder, under
any of the other Credit Documents or in connection herewith or therewith; or
(b) Representations. Any representation, warranty or statement made or
---------------
deemed to be made herein, in any of the other Credit Documents, or in any
statement or certificate delivered or required to be delivered pursuant hereto
or thereto shall prove
85
untrue in any material respect on the date as of which it was made or deemed to
have been made; or
(c) Covenants.
---------
(i) Default in the due performance or observance of any term,
covenant or agreement contained in Section 7.3(a), 7.9, 7.11, 7.13, 8.1,
8.2, 8.3 or 8.6 through 8.12, inclusive, or
(ii) Default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in subsections
(a), (b) or (c)(i) of this Section 9.1) contained in this Credit Agreement
and such default shall continue unremedied for a period of at least 30 days
after the earlier of a responsible officer of a Credit Party becoming aware
of such default or notice thereof by the Administrative Agent; or
(d) Other Credit Documents. (i) Any Credit Party shall default in the due
----------------------
performance or observance of any material term, covenant or agreement in any of
the other Credit Documents (subject to applicable grace or cure periods, if
any), or (ii) except as to the Credit Party which is dissolved, released or
merged or consolidated out of existence as the result of or in connection with a
dissolution, merger or disposition permitted by Section 8.3(a), Section 8.3(b)
or Section 8.3(c), any Credit Document shall fail to be in full force and effect
or to give the Administrative Agent and/or the Lenders any material part of the
Liens, rights, powers and privileges purported to be created thereby; or
(e) Guaranties. Except as to the Credit Party which is dissolved, released
----------
or merged or consolidated out of existence as the result of or in connection
with a dissolution, merger or disposition permitted by Section 8.3(a), Section
8.3(b) or Section 8.3(c), the guaranty given by any Guarantor hereunder or any
material provision thereof shall cease to be in full force and effect, or any
Guarantor hereunder or any Person acting by or on behalf of such Guarantor shall
deny or disaffirm such Guarantor's obligations under such guaranty, or any
Guarantor shall default in the due performance or observance of any term,
covenant or agreement on its part to be performed or observed pursuant to any
guaranty; or
(f) Bankruptcy, etc. Any Bankruptcy Event shall occur with respect to any
---------------
member of the Consolidated Group; or
(g) Defaults under Other Agreements.
-------------------------------
(i) Any member of the Consolidated Group shall default in the
performance or observance (beyond the applicable grace period with respect
thereto, if any) of any
86
material obligation or condition of any contract or lease material to the
Consolidated Group, taken as a whole; or
(ii) With respect to any Indebtedness (other than Indebtedness
outstanding under this Credit Agreement) in excess of $2,500,000 in the
aggregate for the Consolidated Group taken as a whole, (A) (1) any member of
the Consolidated Group shall default in any payment (beyond the applicable
grace period with respect thereto, if any) with respect to any such
Indebtedness, or (2) the occurrence and continuance of a default in the
observance or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any
other event or condition shall occur or condition exist, the effect of which
default or other event or condition is to cause, or permit, the holder or
holders of such Indebtedness (or trustee or agent on behalf of such holders)
to cause (determined without regard to whether any notice or lapse of time
is required), any such Indebtedness to become due prior to its stated
maturity; or (B) any such Indebtedness shall be declared due and payable, or
required to be prepaid other than by a regularly scheduled required
prepayment, prior to the stated maturity thereof; or
(h) Judgments. Any member of the Consolidated Group shall fail within 30
---------
days of the date due and payable to pay, bond or otherwise discharge any
judgment, settlement or order for the payment of money which judgment,
settlement or order, when aggregated with all other such judgments, settlements
or orders due and unpaid at such time, exceeds $2,500,000, and which is not
stayed on appeal (or for which no motion for stay is pending) or is not
otherwise being executed; or
(i) ERISA. Any of the following events or conditions, if such event or
-----
condition could reasonably be expected to have a Material Adverse Effect: (1)
any "accumulated funding deficiency," as such term is defined in Section 302 of
ERISA and Section 412 of the Internal Revenue Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets of a
member of the Consolidated Group or any ERISA Affiliate in favor of the PBGC or
a Plan; (2) an ERISA Event shall occur with respect to a Single Employer Plan,
which is, in the reasonable opinion of the Administrative Agent, likely to
result in the termination of such Plan for purposes of Title IV of ERISA; (3) an
ERISA Event shall occur with respect to a Multiemployer Plan or Multiple
Employer Plan, which is, in the reasonable opinion of the Administrative Agent,
likely to result in (i) the termination of such Plan for purposes of Title IV of
ERISA, or (ii) a member of the Consolidated Group or any ERISA Affiliate
incurring any liability in connection with a withdrawal from, reorganization of
(within the meaning of Section 4241 of ERISA), or insolvency of (within the
meaning of Section 4245 of ERISA) such Plan; or (4) any prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of the Internal
Revenue Code) or breach of fiduciary responsibility shall occur which may
subject a member of the Consolidated Group or any ERISA Affiliate to
87
any liability under Sections 406, 409, 502(i), or 502(l) of ERISA or Section
4975 of the Internal Revenue Code, or under any agreement or other instrument
pursuant to which a member of the Consolidated Group or any ERISA Affiliate has
agreed or is required to indemnify any person against any such liability; or
(j) Ownership. There shall occur a Change of Control.
---------
9.2 Acceleration; Remedies.
----------------------
Upon the occurrence of an Event of Default, and at any time thereafter, the
Administrative Agent shall, upon the request and direction of the Required
Lenders, by written notice to the Credit Parties take any of the following
actions:
(i) Termination of Commitments. Declare the Commitments
--------------------------
terminated whereupon the Commitments shall be immediately terminated.
(ii) Acceleration. Declare the unpaid principal of and any
------------
accrued interest in respect of all Loans, any reimbursement obligations
arising from drawings under Letters of Credit and any and all other
indebtedness or obligations of any and every kind owing by the Credit
Parties to the Administrative Agent and/or any of the Lenders hereunder to
be due whereupon the same shall be immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by each of the Credit Parties.
(iii) Cash Collateral. Direct the Borrower to pay (and the
---------------
Borrower agrees that upon receipt of such notice, or upon the occurrence of
an Event of Default under Section 9.1(f), it will immediately pay) to the
Administrative Agent additional cash, to be held by the Administrative
Agent, for the benefit of the Lenders, in a cash collateral account as
additional security for the LOC Obligations in respect of subsequent
drawings under all then outstanding Letters of Credit in an amount equal to
the maximum aggregate amount which may be drawn under all Letters of Credits
then outstanding.
(iv) Enforcement of Rights. Enforce any and all rights and
---------------------
interests created and existing under the Credit Documents and all rights of
set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(f) shall occur, then the Commitments shall automatically terminate and all
Loans, all reimbursement obligations arising from drawings under Letters of
Credit, all accrued interest in respect thereof, all accrued and unpaid Fees and
other indebtedness or obligations owing to the Administrative Agent and/or any
of the Lenders hereunder automatically shall immediately
88
become due and payable without presentment, demand, protest or the giving of any
notice or other action by the Administrative Agent or the Lenders, all of which
are hereby waived by the Credit Parties.
SECTION 10
AGENCY PROVISIONS
-----------------
10.1 Appointment.
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Each Lender hereby designates and appoints NationsBank, N.A. as
administrative agent (in such capacity, the "Administrative Agent") of such
--------------------
Lender to act as specified herein and the other Credit Documents, and each such
Lender hereby authorizes the Administrative Agent as the Administrative Agent
for such Lender, to take such action on its behalf under the provisions of this
Credit Agreement and the other Credit Documents and to exercise such powers and
perform such duties as are expressly delegated by the terms hereof and of the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. Each Lenders further directs and authorizes the
Administrative Agent to execute releases (or similar agreements) to give effect
to the provisions of this Credit Agreement and the other Credit Documents,
including specifically, without limitation, the provisions of Section 8.3
hereof. Notwithstanding any provision to the contrary elsewhere herein and in
the other Credit Documents, the Administrative Agent shall not have any duties
or responsibilities, except those expressly set forth herein and therein, or any
fiduciary relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Credit Agreement or any of the other Credit Documents, or shall otherwise exist
against the Administrative Agent. The provisions of this Section are solely for
the benefit of the Administrative Agent and the Lenders and none of the Credit
Parties shall have any rights as a third party beneficiary of the provisions
hereof. In performing its functions and duties under this Credit Agreement and
the other Credit Documents, the Administrative Agent shall act solely as
Administrative Agent of the Lenders and does not assume and shall not be deemed
to have assumed any obligation or relationship of agency or trust with or for
any Credit Party or any of their respective Affiliates.
10.2 Delegation of Duties.
--------------------
The Administrative Agent may execute any of its duties hereunder or under
the other Credit Documents by or through agents or attorneys-in-fact and shall
be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
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10.3 Exculpatory Provisions.
----------------------
The Administrative Agent and its officers, directors, employees, agents,
attorneys-in-fact or affiliates shall not be (i) liable for any action lawfully
taken or omitted to be taken by it or such Person under or in connection
herewith or in connection with any of the other Credit Documents (except for its
or such Person's own gross negligence or willful misconduct), or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Credit Parties contained herein
or in any of the other Credit Documents or in any certificate, report, document,
financial statement or other written or oral statement referred to or provided
for in, or received by the Administrative Agent under or in connection herewith
or in connection with the other Credit Documents, or enforceability or
sufficiency therefor of any of the other Credit Documents, or for any failure of
any Credit Party to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectability or
sufficiency of this Credit Agreement, or any of the other Credit Documents or
for any representations, warranties, recitals or statements made herein or
therein or made by the Borrower or any Credit Party in any written or oral
statement or in any financial or other statements, instruments, reports,
certificates or any other documents in connection herewith or therewith
furnished or made by the Administrative Agent to the Lenders or by or on behalf
of the Credit Parties to the Administrative Agent or any Lender or be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or the use of the Letters of Credit
or of the existence or possible existence of any Default or Event of Default or
to inspect the properties, books or records of the Credit Parties or any of
their respective Affiliates.
10.4 Reliance on Communications.
--------------------------
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat the Lenders as the owners of their
respective interests hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.3(b) hereof. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Credit Agreement or under any of the other Credit Documents
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unless it shall first receive such advice or concurrence of the Required Lenders
as it deems appropriate or it shall first be indemnified to its satisfaction by
the Lenders against any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder or under any of the other Credit Documents in
accordance with a request of the Required Lenders (or to the extent specifically
provided in Section 11.6, all the Lenders) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders
(including their successors and assigns).
10.5 Notice of Default.
-----------------
The Administrative Agent shall not be deemed to have knowledge or notice of
the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or a Credit Party
referring to the Credit Document, describing such Default or Event of Default
and stating that such notice is a "notice of default." In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders.
10.6 Non-Reliance on Administrative Agent and Other Lenders.
------------------------------------------------------
Each Lender expressly acknowledges that each of the Administrative Agent
and its officers, directors, employees, Administrative Agents, attorneys-in-fact
or affiliates has not made any representations or warranties to it and that no
act by the Administrative Agent or any affiliate thereof hereinafter taken,
including any review of the affairs of any Credit Party or any of their
respective Affiliates, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower, the other
Credit Parties or their respective Affiliates and made its own decision to make
its Loans hereunder and enter into this Credit Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Credit Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrower, the other
Credit Parties and their respective Affiliates. Except for notices, reports and
other documents expressly required to be furnished to the
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Lenders by the Administrative Agent hereunder, the Administrative Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, assets, property,
financial or other conditions, prospects or creditworthiness of the Borrower,
the other Credit Parties or any of their respective Affiliates which may come
into the possession of the Administrative Agent or any of its officers,
directors, employees, Administrative Agents, attorneys-in-fact or affiliates.
10.7 Indemnification.
---------------
The Lenders agree to indemnify the Administrative Agent in its capacity as
such (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably according to their respective
Commitments (or if the Commitments have expired or been terminated, in
accordance with the respective principal amounts of outstanding Loans and
Participation Interests of the Lenders), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind whatsoever which may at any time
(including without limitation at any time following the final payment of all of
the obligations of the Borrower hereunder and under the other Credit Documents)
be imposed on, incurred by or asserted against the Administrative Agent in its
capacity as such in any way relating to or arising out of this Credit Agreement
or the other Credit Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by the Administrative Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
--------
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from the
gross negligence or willful misconduct of the Administrative Agent. If any
indemnity furnished to the Administrative Agent for any purpose shall, in the
opinion of the Administrative Agent, be insufficient or become impaired, the
Administrative Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished. The agreements in this Section shall survive the repayment of the
Loans, LOC Obligations and other obligations under the Credit Documents and the
termination of the Commitments hereunder.
10.8 Administrative Agent in its Individual Capacity.
-----------------------------------------------
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower,
its Subsidiaries or their respective Affiliates as though the Administrative
Agent were not the Administrative Agent hereunder. With respect to the Loans
made by and all obligations of the Borrower hereunder and under the other Credit
Documents, the Administrative Agent shall have the same rights and powers under
this Credit Agreement as any Lender and may exercise the same as though it were
not the Administrative Agent, and the terms "Lender" and "Lenders" shall include
the
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Administrative Agent in its individual capacity.
10.9 Successor Administrative Agent.
------------------------------
The Administrative Agent may, at any time, resign upon 30 days' written
notice to the Lenders, and may be removed, upon show of cause, by the Required
Lenders upon 30 days' written notice to the Administrative Agent. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Required Lenders, and shall have accepted such
appointment, within 30 days after the notice of resignation or notice of
removal, as appropriate, then the retiring Administrative Agent shall select a
successor Administrative Agent provided such successor is a Lender hereunder or
a commercial bank organized under the laws of the United States of America or of
any State thereof and has a combined capital and surplus of at least
$400,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, and the retiring Administrative Agent
shall be discharged from its duties and obligations as Administrative Agent, as
appropriate, under this Credit Agreement and the other Credit Documents and the
provisions of this Section 10.9 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Credit Agreement.
SECTION 11
MISCELLANEOUS
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11.1 Notices.
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Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (i) when
delivered, (ii) when transmitted via telecopy (or other facsimile device) to the
number set out below, (iii) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (iv)
the third Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case to the respective parties at
the address, in the case of the Borrower, Guarantors and the Administrative
Agent, set forth below, and, in the case of the Lenders, set forth on Schedule
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11.1, or at such other address as such party may specify by written notice to
----
the other parties hereto:
if to the Borrower or the Guarantors:
Just For Feet, Inc.
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▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
if to the Administrative Agent:
NationsBank, N.A.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ Center, 15th Floor
NC1-001-15-04
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇
Agency Services
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
NationsBank, N.A.
Suite ▇▇▇ ▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
11.2 Right of Set-Off.
----------------
In addition to any rights now or hereafter granted under applicable law or
otherwise,
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and not by way of limitation of any such rights, upon the occurrence of an Event
of Default, each Lender is authorized at any time and from time to time, without
presentment, demand, protest or other notice of any kind (all of which rights
being hereby expressly waived), to set-off and to appropriate and apply any and
all deposits (general or special) and any other indebtedness at any time held or
owing by such Lender (including, without limitation branches, agencies or
Affiliates of such Lender wherever located) to or for the credit or the account
of any Credit Party against obligations and liabilities of such Person to such
Lender hereunder, under the Notes, the other Credit Documents or otherwise,
irrespective of whether such Lender shall have made any demand hereunder and
although such obligations, liabilities or claims, or any of them, may be
contingent or unmatured, and any such set-off shall be deemed to have been made
immediately upon the occurrence of an Event of Default even though such charge
is made or entered on the books of such Lender subsequent thereto. Any Person
purchasing a participation in the Loans and Commitments hereunder pursuant to
Section 3.13 or Section 11.3(d) may exercise all rights of set-off with respect
to its participation interest as fully as if such Person were a Lender
hereunder.
11.3 Benefit of Agreement.
--------------------
(a) Generally. This Credit Agreement shall be binding upon and inure to
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the benefit of and be enforceable by the respective successors and assigns of
the parties hereto; provided that none of the Credit Parties may assign or
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transfer any of its interests without prior written consent of the Lenders;
provided further that the rights of each Lender to transfer, assign or grant
-------- -------
participations in its rights and/or obligations hereunder shall be limited as
set forth in this Section 11.3, provided however that nothing herein shall
--------
prevent or prohibit any Lender from (i) pledging its Loans hereunder to a
Federal Reserve Bank in support of borrowings made by such Lender from such
Federal Reserve Bank, or (ii) granting assignments or selling participations in
such Lender's Loans and/or Commitments hereunder to its parent company and/or to
any Affiliate or Subsidiary of such Lender.
(b) Assignments. Each Lender may assign all or a portion of its rights and
-----------
obligations hereunder (including, without limitation, all or a portion of its
Commitments or its Loans), pursuant to an assignment agreement substantially in
the form of Schedule 11.3(b), to (i) a Lender, (ii) an affiliate of a Lender or
----------------
(iii) any other Person (other than the Borrower or an Affiliate of the Borrower)
reasonably acceptable to the Administrative Agent and, so long as no Default or
Event of Default has occurred and is continuing, the Borrower (the consent of
the Borrower shall not be unreasonably withheld or delayed and such consent
shall be deemed given if the Borrower does not notify the assigning Lender and
the Administrative Agent of any objection within two Business Days after the
Borrower has been provided notice of the proposed assignment by the assigning
Lender or the Administrative Agent); provided that (i) any such assignment
--------
(other than any assignment to an existing Lender) shall be in a
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minimum aggregate amount of $5,000,000 (or, if less, the remaining amount of the
Commitment being assigned by such Lender) of the Commitments and in integral
multiples of $1,000,000 above such amount and (ii) each such assignment shall be
of a constant, not varying, percentage of all such Lender's rights and
obligations under this Credit Agreement. Any assignment hereunder shall be
effective upon delivery to the Administrative Agent of written notice of the
assignment, together with (except in the case of an assignment to an affiliate
of the assigning Lender) a transfer fee of $3,500 payable to the Administrative
Agent for its own account, from and after the later of (i) the effective date
specified in the applicable assignment agreement and (ii) the date of recording
of such assignment in the Register pursuant to the terms of subsection (c)
below. The assigning Lender will give prompt notice to the Administrative Agent
and the Borrower of any such assignment. Upon the effectiveness of any such
assignment (and after notice to, and (to the extent required pursuant to the
terms hereof), with the consent of, the Borrower as provided herein), the
assignee shall become a "Lender" for all purposes of this Credit Agreement and
the other Credit Documents and, to the extent of such assignment, the assigning
Lender shall be relieved of its obligations hereunder to the extent of the Loans
and Commitment components being assigned. Along such lines the Borrower agrees
that upon notice of any such assignment and surrender of the appropriate Note or
Notes, it will promptly provide to the assigning Lender and to the assignee
separate promissory notes in the amount of their respective interests
substantially in the form of the original Note (but with notation thereon that
it is given in substitution for and replacement of the original Note or any
replacement notes thereof). By executing and delivering an assignment agreement
in accordance with this Section 11.3(b), the assigning Lender thereunder and the
assignee thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender warrants that it
is the legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim; (ii) except as set forth in clause (i) above,
such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Credit Agreement, any of the other Credit
Documents or any other instrument or document furnished pursuant hereto or
thereto, or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, any of the other Credit Documents
or any other instrument or document furnished pursuant hereto or thereto or the
financial condition of any Credit Party or any of their respective Affiliates or
the performance or observance by any Credit Party of any of its obligations
under this Credit Agreement, any of the other Credit Documents or any other
instrument or document furnished pursuant hereto or thereto; (iii) such assignee
represents and warrants that it is legally authorized to enter into such
assignment agreement; (iv) such assignee confirms that it has received a copy of
this Credit Agreement, the other Credit Documents and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such assignment agreement; (v) such assignee will
independently and without reliance upon the Administrative Agent, such assigning
Lender or any other Lender,
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and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Credit Agreement and the other Credit Documents; (vi) such assignee
appoints and authorizes the Administrative Agent to take such action on its
behalf and to exercise such powers under this Credit Agreement or any other
Credit Document as are delegated to the Administrative Agent by the terms hereof
or thereof, together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with their terms
all the obligations which by the terms of this Credit Agreement and the other
Credit Documents are required to be performed by it as a Lender.
(c) Maintenance of Register. The Administrative Agent shall maintain at
-----------------------
one of its offices in Charlotte, North Carolina a copy of each Lender assignment
agreement delivered to it in accordance with the terms of subsection (b) above
and a register for the recordation of the identity of the principal amount, type
and Interest Period of each Loan outstanding hereunder, the names, addresses and
the Commitments of the Lenders pursuant to the terms hereof from time to time
(the "Register"). The Administrative Agent will make reasonable efforts to
--------
maintain the accuracy of the Register and to promptly update the Register from
time to time, as necessary. The entries in the Register shall be conclusive in
the absence of manifest error and the Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register pursuant to
the terms hereof as a Lender hereunder for all purposes of this Credit
Agreement. The Register shall be available for inspection by the Borrower and
each Lender, at any reasonable time and from time to time upon reasonable prior
notice.
(d) Participations. Each Lender may sell, transfer, grant or assign
--------------
participations in all or a portion of such Lender's rights, obligations or
rights and obligations hereunder (including all or a portion of its Commitments
or its Loans); provided that (i) such selling Lender shall remain a "Lender" for
--------
all purposes under this Credit Agreement (such selling Lender's obligations
under the Credit Documents remaining unchanged) and the participant shall not
constitute a Lender hereunder, (ii) no such participant shall have, or be
granted, rights to approve any amendment or waiver relating to this Credit
Agreement or the other Credit Documents except to the extent any such amendment
or waiver would (A) reduce the principal of or rate of interest on or Fees in
respect of any Loans in which the participant is participating, (B) postpone the
date fixed for any payment of principal (including extension of the Termination
Date or the date of any mandatory prepayment), interest or Fees in which the
participant is participating, (C) except as the result of or in connection with
a dissolution, merger or disposition of a Subsidiary permitted under Section
8.3, release the Borrower or substantially all of the Guarantors from its or
their obligations under the Credit Documents, or (D) except as the result of or
in connection with a disposition permitted under Section 8.3(b), release all or
substantially all of the
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collateral, and (iii) sub-participations by the participant (except to an
affiliate, parent company or affiliate of a parent company of the participant)
shall be prohibited. In the case of any such participation, the participant
shall not have any rights under this Credit Agreement or the other Credit
Documents (the participant's rights against the selling Lender in respect of
such participation to be those set forth in the participation agreement with
such Lender creating such participation) and all amounts payable by the Borrower
hereunder shall be determined as if such Lender had not sold such participation,
provided, however, that such participant shall be entitled to receive
--------
additional amounts under Sections 3.6, 3.9, 3.10, 3.11 and 11.2 on the same
basis as if it were a Lender.
11.4 No Waiver; Remedies Cumulative.
------------------------------
No failure or delay on the part of the Administrative Agent or any Lender
in exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Administrative Agent or any Lender
and any of the Credit Parties shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or under
any other Credit Document preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder or thereunder. The
rights and remedies provided herein are cumulative and not exclusive of any
rights or remedies which the Administrative Agent or any Lender would otherwise
have. No notice to or demand on any Credit Party in any case shall entitle the
Borrower or any other Credit Party to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.
11.5 Payment of Expenses, etc.
------------------------
The Borrower agrees to: (i) pay all reasonable out-of-pocket costs and
expenses (A) of the Administrative Agent in connection with the negotiation,
preparation, execution and delivery and administration of this Credit Agreement
and the other Credit Documents and the documents and instruments referred to
therein (including, without limitation, the reasonable fees and expenses of
▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC, special counsel to the Administrative Agent) and any
amendment, waiver or consent relating hereto and thereto including, but not
limited to, any such amendments, waivers or consents resulting from or related
to any work-out, renegotiation or restructure relating to the performance by the
Credit Parties under this Credit Agreement and (B) of the Administrative Agent
and the Lenders in connection with enforcement of the Credit Documents and the
documents and instruments referred to therein (including, without limitation, in
connection with any such enforcement, the reasonable fees and disbursements of
counsel for the Administrative Agent and each of the Lenders); (ii) pay and hold
each of the Lenders harmless from and against any and all present
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and future stamp and other similar taxes with respect to the foregoing matters
and save each of the Lenders harmless from and against any and all liabilities
with respect to or resulting from any delay or omission (other than to the
extent attributable to such Lender) to pay such taxes; and (iii) indemnify each
Lender, its officers, directors, employees, representatives and agents from and
hold each of them harmless against any and all losses, liabilities, claims,
damages or expenses incurred by any of them as a result of, or arising out of,
or in any way related to, or by reason of (A) any investigation, litigation or
other proceeding (whether or not any Lender is a party thereto) related to the
entering into and/or performance of any Credit Document or the use of proceeds
of any Loans (including other extensions of credit) hereunder or the
consummation of any other transactions contemplated in any Credit Document,
including, without limitation, the reasonable fees and disbursements of counsel
incurred in connection with any such investigation, litigation or other
proceeding or (B) the presence or Release of any Materials of Environmental
Concern at, under or from any Property owned, operated or leased by the Borrower
or any of its Subsidiaries, or the failure by the Borrower or any of its
Subsidiaries to comply with any Environmental Law (but excluding, in the case of
either of clause (A) or (B) above, any such losses, liabilities, claims, damages
or expenses to the extent incurred by reason of gross negligence or willful
misconduct on the part of the Person to be indemnified).
11.6 Amendments, Waivers and Consents.
--------------------------------
Neither this Credit Agreement nor any other Credit Document nor any of the
terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing entered into by, or approved in writing by, the Required Lenders and the
Borrower, provided, however, that:
-------- -------
(a) without the consent of each Lender affected thereby, neither this
Credit Agreement nor any of the other Credit Documents may be amended to
(i) extend the final maturity of any Loan or the time of payment
of any reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit,
(ii) reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any increase
in interest rates after the occurrence of an Event of Default or on
account of a failure to deliver financial statements on a timely
basis) thereon or Fees hereunder,
(iii) reduce or waive the principal amount of any Loan or of any
reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit,
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(iv) increase the Commitment of a Lender over the amount thereof
in effect (it being understood and agreed that a waiver of any Default
or Event of Default or mandatory reduction in the Commitments shall
not constitute a change in the terms of any Commitment of any Lender),
(v) except as the result of or in connection with a dissolution,
merger or disposition of a Subsidiary permitted under Section 8.3,
release the Borrower or substantially all of the Guarantors from its
or their obligations under the Credit Documents,
(vi) except as the result of or in connection with a disposition
permitted under Section 8.3(b), release all or substantially all of
the collateral,
(vii) amend, modify or waive any provision of this Section 11.6
or Section 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 9.1(a),
11.2, 11.3, 11.5 or 11.9,
(viii) modify any percentage specified in, or otherwise amend,
the definition of Required Lenders, or
(ix) consent to the assignment or transfer by the Borrower (or
another Credit Party) of any of its rights and obligations under (or
in respect of) the Credit Documents except as permitted thereby;
(b) without the consent of the Administrative Agent, no provision of
Section 10 may be amended;
(c) without the consent of the Issuing Lender, no provision of Section 2.2
may be amended.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders may consent to allow a Credit Party to use cash
collateral in the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts.
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This Credit Agreement may be executed in any number of counterparts, each
of which
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when so executed and delivered shall be an original, but all of which shall
constitute one and the same instrument. It shall not be necessary in making
proof of this Credit Agreement to produce or account for more than one such
counterpart.
11.8 Headings.
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The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 Survival.
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All indemnities set forth herein, including, without limitation, in Section
2.2(i), 3.9, 3.11, 10.7 or 11.5 shall survive the execution and delivery of this
Credit Agreement, the making of the Loans, the issuance of the Letters of
Credit, the repayment of the Loans, LOC Obligations and other obligations under
the Credit Documents and the termination of the Commitments hereunder, and all
representations and warranties made by the Credit Parties herein shall survive
delivery of the Notes and the making of the Loans hereunder.
11.10 Governing Law; Submission to Jurisdiction; Venue.
------------------------------------------------
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH
CAROLINA. Any legal action or proceeding with respect to this Credit Agreement
or any other Credit Document may be brought in the courts of the State of North
Carolina in Mecklenburg County, or of the United States for the Western District
of North Carolina, and, by execution and delivery of this Credit Agreement, each
of the Credit Parties hereby irrevocably accepts for itself and in respect of
its property, generally and unconditionally, the nonexclusive jurisdiction of
such courts. Each of the Credit Parties further irrevocably consents to the
service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to it at the address set out for notices pursuant to Section
11.1, such service to become effective three (3) days after such mailing.
Nothing herein shall affect the right of the Administrative Agent to serve
process in any other manner permitted by law or to commence legal proceedings or
to otherwise proceed against any Credit Party in any other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably waives any objection
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which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Credit Agreement or any other Credit Document brought in the courts referred to
in subsection (a) hereof and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE ADMINISTRATIVE AGENT, THE
LENDERS, THE BORROWER AND THE OTHER CREDIT PARTIES HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
11.11 Severability.
------------
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.12 Entirety.
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This Credit Agreement together with the other Credit Documents represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Documents or the transactions
contemplated herein and therein.
11.13 Binding Effect; Termination.
---------------------------
(a) This Credit Agreement shall become effective at such time on or after
the Closing Date when it shall have been executed by the Borrower, the
Guarantors and the Administrative Agent, and the Administrative Agent shall have
received copies hereof (telefaxed or otherwise) which, when taken together, bear
the signatures of each Lender, and thereafter this Credit Agreement shall be
binding upon and inure to the benefit of the Borrower, the Guarantors, the
Administrative Agent and each Lender and their respective successors and
assigns.
(b) The term of this Credit Agreement shall commence on the effective date
pursuant to subsection (a) above and shall continue until no Loans, LOC
Obligations or any
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other amounts payable hereunder or under any of the other Credit Documents shall
remain outstanding and until all of the Commitments hereunder shall have expired
or been terminated.
11.14 Confidentiality.
---------------
The Administrative Agent and the Lenders agree to keep confidential (and to
cause their respective affiliates, officers, directors, employees, agents and
representatives to keep confidential) all information, materials and documents
furnished to the Administrative Agent or any such Lender by or on behalf of any
Credit Party (whether before or after the Closing Date) which relates to the
Borrower or any of its Subsidiaries (the "Information"). Notwithstanding the
-----------
foregoing, the Administrative Agent and each Lender shall be permitted to
disclose Information (i) to its affiliates, officers, directors, employees,
Administrative Agents and representatives in connection with its participation
in any of the transactions evidenced by this Credit Agreement or any other
Credit Documents or the administration of this Credit Agreement or any other
Credit Documents; (ii) to the extent required by applicable laws and regulations
or by any subpoena or similar legal process, or requested by any Governmental
Authority; (iii) to the extent such Information (A) becomes publicly available
other than as a result of a breach of this Credit Agreement or any agreement
entered into pursuant to clause (iv) below, (B) becomes available to the
Administrative Agent or such Lender on a non-confidential basis from a source
other than a Credit Party or (C) was available to the Administrative Agent or
such Lender on a non-confidential basis prior to its disclosure to the
Administrative Agent or such Lender by a Credit Party; (iv) to any assignee or
participant (or prospective assignee or participant) so long as such assignee or
participant (or prospective assignee or participant) first specifically agrees
in a writing furnished to and for the benefit of the Credit Parties to be bound
by the terms of this Section 11.14; or (v) to the extent that the Borrower shall
have consented in writing to such disclosure. Nothing set forth in this Section
11.14 shall obligate the Administrative Agent or any Lender to return any
materials furnished by the Credit Parties.
11.15 Source of Funds.
---------------
Each of the Lenders hereby represents and warrants to the Borrower that at
least one of the following statements is an accurate representation as to the
source of funds to be used by such Lender in connection with the financing
hereunder:
(a) no part of such funds constitutes assets allocated to any separate
account maintained by such Lender in which any employee benefit plan (or its
related trust) has any interest;
(b) to the extent that any part of such funds constitutes assets allocated
to
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any separate account maintained by such Lender, such Lender has disclosed to the
Borrower the name of each employee benefit plan whose assets in such account
exceed 10% of the total assets of such account as of the date of such purchase
(and, for purposes of this subsection (b), all employee benefit plans maintained
by the same employer or employee organization are deemed to be a single plan);
(c) to the extent that any part of such funds constitutes assets of an
insurance company's general account, such insurance company has complied with
all of the requirements of the regulations issued under Section 401(c)(1)(A) of
ERISA; or
(d) such funds constitute assets of one or more specific benefit plans
which such Lender has identified in writing to the Borrower.
As used in this Section 11.15, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
11.16 Conflict.
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To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.
[Signature Page to Follow]
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IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Credit Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: JUST FOR FEET, INC.,
--------
a Delaware corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Chief Financial Officer
GUARANTORS: SNEAKER STADIUM, INC.,
----------
a Delaware corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
SNKR HOLDING CORP.,
a Delaware corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
PREMIUM SPORTS, INC.,
a Florida corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
ATHLETIC ATTIC PROPERTIES, INC.,
a Florida corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
ATHLETIC ATTIC MARKETING, INC.,
a Florida corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
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ATHLETIC ATTIC RETAIL COMPANY,
a Florida corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
JUST FOR FEET OF TEXAS, INC.
an Alabama corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
JUST FOR FEET OF NEVADA, INC.
a Nevada corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
IMPERIAL ACQUISITION CORPORATION,
a Michigan corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
JUST FOR FEET SPECIALTY STORES, INC.
a Michigan corporation
By:
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
LENDERS: NATIONSBANK, N.A.,
------- individually in its capacity as a
Lender and in its capacity as Administrative Agent
By:
Name:
Title:
SUNTRUST BANK, ATLANTA
By:
Name:
Title:
COMPASS BANK
By:
Name:
Title:
AMSOUTH BANK
By:
Name:
Title:
BANCO POPULAR DE PUERTO RICO
By:
Name:
Title:
MICHIGAN NATIONAL BANK
By:
Name:
Title:
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FIRST AMERICAN NATIONAL BANK
By:
Name:
Title:
FIRST UNION NATIONAL BANK
By:
Name:
Title:
MARINE MIDLAND BANK
By:
Name:
Title:
SOUTHTRUST BANK, N.A.
By:
Name:
Title:
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