EXECUTION VERSION
TERM LOAN AGREEMENT
dated as of January 15, 2008
between
GPW VIRGINIA TIMBERLANDS LLC
as Borrower
THE LENDERS FROM TIME TO TIME PARTY HERETO
AND
SUNTRUST BANK
as Agent
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS; CONSTRUCTION.................................... 1
SECTION 1.01 DEFINITIONS.................................................. 1
SECTION 1.02 ACCOUNTING TERMS AND DETERMINATION........................... 14
SECTION 1.03 TERMS GENERALLY.............................................. 14
ARTICLE II. AMOUNT AND TERMS OF THE COMMITMENT........................... 15
SECTION 2.01 TERM LOAN COMMITMENT......................................... 15
SECTION 2.02 INTEREST ELECTION............................................ 15
SECTION 2.03 TERMINATION OF COMMITMENTS................................... 15
SECTION 2.04 REPAYMENT OF TERM LOAN....................................... 16
SECTION 2.05 OPTIONAL PREPAYMENTS......................................... 16
SECTION 2.06 MANDATORY PREPAYMENTS........................................ 16
SECTION 2.07 INTEREST ON TERM LOAN........................................ 16
SECTION 2.08 FEES......................................................... 17
SECTION 2.09 COMPUTATION OF INTEREST...................................... 17
SECTION 2.10 INABILITY TO DETERMINE INTEREST RATES........................ 17
SECTION 2.11 ILLEGALITY................................................... 18
SECTION 2.12 INCREASED COSTS.............................................. 18
SECTION 2.13 FUNDING INDEMNITY............................................ 19
SECTION 2.14 TAXES........................................................ 19
SECTION 2.15 PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF SET-OFFS.. 21
ARTICLE III. CONDITIONS PRECEDENT......................................... 23
SECTION 3.01 REPRESENTATIONS AND WARRANTIES............................... 23
SECTION 3.02 PERFORMANCE; NO DEFAULT...................................... 23
SECTION 3.03 COMPLIANCE CERTIFICATES...................................... 23
SECTION 3.04 OPINIONS OF COUNSEL.......................................... 23
SECTION 3.05 INSTALLMENT SALE TRANSACTION; INITIAL CAPITALIZATION
TRANSACTION.................................................. 24
SECTION 3.06 TRANSACTION DOCUMENTS........................................ 24
SECTION 3.07 COLLATERAL................................................... 25
SECTION 3.08 INTEREST RESERVE ACCOUNT AND COLLECTION ACCOUNT.............. 25
SECTION 3.09 INTEREST RESERVE AMOUNT...................................... 25
SECTION 3.10 TERM LOAN PERMITTED BY APPLICABLE LAW, ETC................... 25
SECTION 3.11 PAYMENT OF SPECIAL COUNSEL FEES.............................. 26
SECTION 3.12 FUNDING INSTRUCTIONS......................................... 26
SECTION 3.13 PROCEEDINGS AND DOCUMENTS.................................... 26
ARTICLE IV. REPRESENTATIONS AND WARRANTIES............................... 26
SECTION 4.01 ORGANIZATION; POWER AND AUTHORITY............................ 26
SECTION 4.02 AUTHORIZATION, ETC........................................... 26
SECTION 4.03 DISCLOSURE................................................... 27
SECTION 4.04 ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES......... 27
SECTION 4.05 CLOSING DATE BALANCE SHEET; LIABILITIES...................... 27
SECTION 4.06 COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC................. 27
SECTION 4.07 GOVERNMENTAL AUTHORIZATIONS, ETC............................. 27
SECTION 4.08 LITIGATION; OBSERVANCE OF STATUTES AND ORDERS................ 28
SECTION 4.09 TAXES........................................................ 28
SECTION 4.10 TITLE TO PROPERTY............................................ 28
SECTION 4.11 LICENSES, PERMITS, ETC....................................... 28
SECTION 4.12 COMPLIANCE WITH ERISA........................................ 28
SECTION 4.13 [Reserved]................................................... 29
SECTION 4.14 USE OF PROCEEDS; MARGIN REGULATIONS.......................... 29
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SECTION 4.15 INDEBTEDNESS................................................. 30
SECTION 4.16 SOLVENCY..................................................... 30
SECTION 4.17 ACTIVITIES................................................... 30
SECTION 4.18 FOREIGN ASSETS CONTROL REGULATIONS, ETC...................... 30
SECTION 4.19 INVESTMENT COMPANY ACT....................................... 31
ARTICLE V. AFFIRMATIVE COVENANTS........................................ 31
SECTION 5.01 FINANCIAL AND BUSINESS INFORMATION........................... 31
SECTION 5.02 OFFICER'S CERTIFICATE........................................ 32
SECTION 5.03 VISITATION................................................... 32
SECTION 5.04 COMPLIANCE WITH LAW.......................................... 33
SECTION 5.05 INSURANCE.................................................... 33
SECTION 5.06 MAINTENANCE OF PROPERTIES.................................... 33
SECTION 5.07 PAYMENT OF TAXES............................................. 33
SECTION 5.08 CORPORATE EXISTENCE, ETC..................................... 33
SECTION 5.09 PAYMENT OF OBLIGATIONS....................................... 33
SECTION 5.10 BOOKS AND RECORDS............................................ 34
SECTION 5.11 ACTIVITIES................................................... 34
SECTION 5.12 CHARACTERIZATION OF BORROWER FOR TAX PURPOSES................ 34
ARTICLE VI. NEGATIVE COVENANTS........................................... 34
SECTION 6.01 INDEBTEDNESS................................................. 34
SECTION 6.02 LIENS........................................................ 34
SECTION 6.03 TRANSACTIONS WITH AFFILIATES................................. 34
SECTION 6.04 MERGER, CONSOLIDATION, ETC................................... 35
SECTION 6.05 LINE OF BUSINESS............................................. 35
SECTION 6.06 TERRORISM SANCTIONS REGULATIONS.............................. 35
SECTION 6.07 INVESTMENTS.................................................. 35
SECTION 6.08 DISTRIBUTIONS................................................ 35
SECTION 6.09 CAPITAL EXPENDITURES......................................... 36
SECTION 6.10 BANKRUPTCY, INSOLVENCY....................................... 36
SECTION 6.11 AMENDMENTS AND MODIFICATIONS TO ORGANIZATIONAL DOCUMENTS
AND COLLATERAL............................................... 36
ARTICLE VII. EVENTS OF DEFAULT............................................ 37
SECTION 7.01 EVENTS OF DEFAULT............................................ 37
SECTION 7.02 REMEDIES ON DEFAULT, ETC..................................... 38
ARTICLE VIII. THE AGENT.................................................... 39
SECTION 8.01 APPOINTMENT OF AGENT......................................... 39
SECTION 8.02 NATURE OF DUTIES OF AGENT.................................... 40
SECTION 8.03 LACK OF RELIANCE ON THE AGENT................................ 40
SECTION 8.04 CERTAIN RIGHTS OF THE AGENT.................................. 40
SECTION 8.05 RELIANCE BY AGENT............................................ 41
SECTION 8.06 THE AGENT IN ITS INDIVIDUAL CAPACITY......................... 41
SECTION 8.07 SUCCESSOR AGENT.............................................. 41
SECTION 8.08 AUTHORIZATION TO EXECUTE OTHER LOAN DOCUMENTS................ 42
ARTICLE IX. MISCELLANEOUS................................................ 42
SECTION 9.01 NOTICES...................................................... 42
SECTION 9.02 WAIVER; AMENDMENTS........................................... 43
SECTION 9.03 EXPENSES; INDEMNIFICATION.................................... 44
SECTION 9.04 SUCCESSORS AND ASSIGNS....................................... 45
SECTION 9.05 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS... 49
SECTION 9.06 WAIVER OF JURY TRIAL......................................... 49
SECTION 9.07 RIGHT OF SETOFF.............................................. 50
SECTION 9.08 COUNTERPARTS; INTEGRATION.................................... 50
SECTION 9.09 SURVIVAL..................................................... 50
SECTION 9.10 SEVERABILITY................................................. 51
SECTION 9.11 CONFIDENTIALITY.............................................. 51
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SECTION 9.12 INTEREST RATE LIMITATION..................................... 51
SECTION 9.13 QUALIFIED PURCHASER.......................................... 52
Schedules
Schedule 4.05 - Closing Date Balance Sheet
Schedule 4.15 - Other Indebtedness
Exhibits
Exhibit A - Term Note
Exhibit B - Form of Glatfelter Note
Exhibit C - Form of Assignment and Acceptance
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TERM LOAN AGREEMENT
THIS TERM LOAN AGREEMENT (this "Agreement") is made and entered into
as of January 15, 2008, by and between GPW VIRGINIA TIMBERLANDS LLC, a Delaware
limited liability company (the "Borrower") the several banks and other financial
institutions from time to time party hereto (the "Lenders"), and SUNTRUST BANK,
in its capacity as Agent for the Lenders (in such capacity, the "Agent").
WITNESSETH:
WHEREAS, the Borrower has requested that the Lender make a term loan
in a principal amount equal to $36,694,500.00 to the Borrower;
WHEREAS, subject to the terms and conditions of this Agreement, the
Lender is willing to make the term loan to the Borrower.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Agent, the Borrower and the Lenders agree as
follows:
ARTICLE I. DEFINITIONS; CONSTRUCTION
SECTION 1.01 DEFINITIONS.
In addition to the other terms defined herein, the following terms used
herein shall have the meanings herein specified (to be equally applicable to
both the singular and plural forms of the terms defined):
"ADJUSTED LIBO RATE" shall mean, with respect to each Interest Period
for a Eurodollar Loan, the rate per annum obtained by dividing (i) LIBOR for
such Interest Period by (ii) a percentage equal to 1.00 minus the Eurodollar
Reserve Percentage.
"ADMINISTRATIVE QUESTIONNAIRE" shall mean, with respect to each
Lender, an administrative questionnaire in the form prepared by the Agent and
submitted to the Agent duly completed by such Lender.
"AFFILIATE" means, at any time, and with respect to any Person, any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person. As used in this definition, "Control" means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting
securities, by contract or otherwise. Unless the context otherwise clearly
requires, any reference to an "Affiliate" is a reference to an Affiliate of the
Borrower.
"AGENT" shall have the meaning set forth in the introductory paragraph
hereof.
"ANTI-TERRORISM ORDER" means Executive Order No. 13,224 of September
24, 2001, Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit or Support Terrorism, 66 U.S. Fed. Reg. 49, 079
(2001), as amended.
"APPLICABLE LENDING OFFICE" shall mean, for each Lender the "Lending
Office" of such Lender (or an Affiliate of such Lender) designated in the
Administrative Questionnaire submitted by such Lender or such other office of
such Lender (or an Affiliate of such Lender) as such Lender may from time to
time specify to the Agent and the Borrower as the office by which its Term Loan
is to be made and maintained.
"APPLICABLE MARGIN" shall mean 0.00% per annum on a Base Rate Loan and
1.20% per annum on a Eurodollar Loan.
"APPROVED FUND" means any Person (other than a natural Person) that is
(or will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business and that is administered or managed by (a) the Lender, (b) an Affiliate
of the Lender or (c) an entity or an Affiliate of an entity that administers or
manages the Lender.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.04(b)) and accepted by the Agent, in the form
of Exhibit C attached hereto or any other form approved by the Agent.
"AVAILABLE FUNDS" means, as of any date of determination, the amount
by which cash on deposit in the Interest Reserve Account and the Collection
Account, and Permitted Investments standing to the credit of the Interest
Reserve Account or the Collection Account or otherwise subject to a perfected,
first priority Lien in favor of the Collateral Trustee, exceeds the sum of (a)
the amount of principal, interest and other sums in respect of the Term Loan
that is due and payable within the 45 days following such date of determination,
plus (b) the Interest Reserve Amount, plus (c) the amount of expenses projected
by the Borrower in good faith to be due and payable on or prior to the last day
of the immediately succeeding Interest Period as certified by a Responsible
Officer of the Borrower to the Collateral Trustee.
"BASE RATE" shall mean the higher of (i) the per annum rate which the
Agent publicly announces from time to time to be its prime lending rate, as in
effect from time to time, and (ii) the Federal Funds Rate, as in effect from
time to time, plus one-half of one percent (0.50%). The Agent's prime lending
rate is a reference rate and does not necessarily represent the lowest or best
rate charged to customers. The Agent may make commercial loans or other loans at
rates of interest at, above or below the Agent's prime lending rate. Each change
in the Agent's prime lending rate shall be effective from and including the date
such change is publicly
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announced as being effective. When used in reference to the Term Loan, "Base
Rate" refers to whether the Term Loan bears interest at a rate determined by
reference to the Base Rate (e.g., a "Base Rate Loan").
"BORROWER" shall have the meaning in the introductory paragraph
hereof.
"BUSINESS DAY" shall mean (i) any day other than a Saturday, Sunday or
other day on which commercial banks in Atlanta, Georgia or Richmond, Virginia
are authorized or required by law to close and (ii) if such day relates to a
borrowing of, a payment or prepayment of principal or interest on, a conversion
of, or an Interest Period for, a Eurodollar Loan or a notice with respect to any
of the foregoing, any London Business Day.
"CAPITALIZATION TRANSACTION" means, collectively, (a) the Initial
Capitalization Transaction, (b) the purchase by the Borrower from Glatfelter on
the date of Closing of a Glatfelter Note in the principal amount of
$3,377,000.00 for a purchase price equal to 100% of the principal amount
thereof, paid by the Borrower with proceeds of the Term Loan, and (c) the
contribution by the Parent on the date of Closing of a Glatfelter Note in the
principal amount of $5,781,000.00.
"CHANGE IN LAW" shall mean (i) the adoption of any applicable law,
rule or regulation after the date of this Agreement, (ii) any change in any
applicable law, rule or regulation, or any change in the interpretation or
application thereof, by any Governmental Authority after the date of this
Agreement, or (iii) compliance by the Lender (or by the Lender's holding
company, if applicable) with any request, guideline or directive (whether or not
having the force of law) of any Governmental Authority made or issued after the
date of this Agreement.
"CLOSING DATE" or the "CLOSING" shall mean the date on which the
conditions precedent set forth in Article III have been satisfied or waived.
"CLOSING DATE BALANCE SHEET" means the balance sheet of the Borrower
as of the date of Closing, after giving effect and fully reflecting all of the
transactions contemplated to occur on or prior to Closing, including, without
limitation, the Capitalization Transaction, the Term Loan and the Closing Date
Distribution.
"CLOSING DATE DISTRIBUTION" means a cash distribution made by the
Borrower to the Parent on the date of Closing in the amount of $32,377,500.
"CODE" shall mean the Internal Revenue Code of 1986, as amended and in
effect from time to time.
"COLLATERAL" means (a) the Installment Note, (b) the Letter of Credit,
(c) the Glatfelter Securities, (d) the Interest Reserve Account and all cash and
other items from time to time standing to the credit of the Interest Reserve
Account, (e) the Collection Account and all cash and other items from time to
time standing to the credit of the Collection Account, (f) all rights of the
Borrower under the Contribution Agreement, (g) all other assets of the Borrower,
and (h) any and all proceeds of any of the foregoing.
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"COLLATERAL TRUSTEE" means SunTrust Bank, in its capacity as
Collateral Trustee pursuant to the Collateral Trust Indenture.
"COLLATERAL TRUST INDENTURE" means that certain Collateral Trust
Indenture dated as of January 15, 2008 between the Collateral Trustee and the
Borrower.
"COMMITMENT" shall mean the Term Loan Commitment.
"CONTRIBUTION AGREEMENT" means the Contribution Agreement, dated as of
January 14, 2008, between the Parent and the Borrower.
"CONTRIBUTION AGREEMENT EVENT" means (a) any representation or
warranty made by the Parent in the Contribution Agreement proves to have been
false or incorrect in any material respect on the date as of which made or (b)
the Parent defaults in the performance of or compliance with any term in the
Contribution Agreement to be performed by or complied with by the Parent and
such defaults are not remedied within 30 days after the earlier of (i) a
responsible officer of the Parent obtaining actual knowledge of such default and
(ii) the Parent receiving written notice of such default.
"DEFAULT" shall mean any condition or event that, with the giving of
notice or the lapse of time or both, would constitute an Event of Default.
"DEFAULT INTEREST" shall have the meaning set forth in Section
2.07(b).
"DOLLAR(S)" and the sign "$" shall mean lawful money of the United
States of America.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) that is treated as a single employer together with the Borrower
under section 414 of the Code.
"EURODOLLAR" when used in reference to the Term Loan, refers to
whether the Term Loan bears interest at a rate determined by reference to the
Adjusted LIBO Rate (e.g., a "Eurodollar Loan").
"EURODOLLAR RESERVE PERCENTAGE" shall mean the aggregate (without
duplication) of the maximum reserve percentages (including, without limitation,
any emergency, supplemental, special or other marginal reserves) expressed as a
decimal (rounded upwards to the next 1/100th of 1%) in effect on any day to
which the Lender is subject with respect to the Adjusted LIBO Rate pursuant to
regulations issued by the Board of Governors of the Federal Reserve System (or
any Governmental Authority succeeding to any of its principal functions) with
respect to eurocurrency funding (currently referred to as "eurocurrency
liabilities" under
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Regulation D). Any Eurodollar Loan shall be deemed to constitute eurocurrency
funding and to be subject to such reserve requirements without benefit of or
credit for proration, exemptions or offsets that may be available from time to
time to the Lender under Regulation D. The Eurodollar Reserve Percentage shall
be adjusted automatically on and as of the effective date of any change in any
reserve percentage.
"EVENT OF DEFAULT" shall have the meaning provided in Section 7.01.
"EXCLUDED TAXES" shall mean with respect to the Agent, any Lender or
any other recipient of any payment to be made by or on account of any obligation
of the Borrower hereunder, (a) Taxes imposed on or measured by such recipient's
overall net income (however denominated), franchise Taxes imposed on such
recipient (in lieu of net income Taxes), and branch profits or similar Taxes
imposed on it by any jurisdiction (or any political subdivision thereof) as a
result of such recipient being organized or having its principal office or, in
the case of any Lender, its Applicable Lending Office located in such
jurisdiction or as a result of a present or former connection with such
jurisdiction (other than any such connection arising from such recipient having
executed, delivered or performed its obligations or received a payment under, or
enforced, or otherwise with respect to, any of the Loan Documents), and (b) any
withholding or backup withholding Tax that (i) is imposed under the law in
effect at the time such recipient becomes a party to this Agreement, except to
the extent of any additional amounts to which such Lender's assignor (if any)
was entitled at the time of assignment, or designates a new lending office
(unless such re-designation was at the request of the Borrower), other than
Taxes that have accrued prior to the designation of such lending office that are
otherwise not Excluded Taxes, or (ii) is attributable to such Foreign Lender's
failure (or unreasonable delay) to comply (other than as a result of a change in
law, rule, regulation or treaty or treaty or in the administration,
interpretation or application thereof by a Governmental Authority) with Section
2.14(e).
"FEDERAL FUNDS RATE" shall mean, for any day, the rate per annum
(rounded upwards, if necessary, to the next 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with member banks
of the Federal Reserve System arranged by Federal funds brokers, as published by
the Federal Reserve Bank of New York on the next succeeding Business Day or if
such rate is not so published for any Business Day, the Federal Funds Rate for
such day shall be the average rounded upwards, if necessary, to the next 1/100th
of 1% of the quotations for such day on such transactions received by the Agent
from three Federal funds brokers of recognized standing selected by the Agent.
"FEE LETTER" shall mean that certain fee letter, dated as of January
9, 2008, executed by SunTrust ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc. and SunTrust Bank and
accepted by the Borrower.
"FOREIGN LENDER" shall mean any Lender that is not a United States
person under Section 7701(a)(30) of the Code.
"GAAP" shall mean generally accepted accounting principles in the
United States applied on a consistent basis and subject to the terms of Section
1.02.
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"GLATFELTER" means P.H. Glatfelter Company, a Pennsylvania
corporation.
"GLATFELTER NOTE" means any note issued by Glatfelter in favor of the
Borrower in the form of Exhibit B.
"GLATFELTER SECURITIES" means, collectively, (a) the Glatfelter Note
in the principal amount of $5,781,000.00 contributed by the Parent to the
Borrower on the date of Closing, and (b) the Glatfelter Note in the principal
amount of $3,377,000.00 purchased by the Borrower from Glatfelter on the date of
Closing with proceeds from the Term Loan.
"GOVERNMENTAL AUTHORITY" means (a) the government of (i) the United
States of America or any State or other political subdivision thereof, or (ii)
any other jurisdiction in which the Borrower conducts all or any part of its
business, or which asserts jurisdiction over any properties of the Borrower, or
(b) any entity exercising executive, legislative, judicial, regulatory or
administrative functions of, or pertaining to, any such government
"GUARANTEE" means, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a) to purchase such indebtedness or obligation or any property
constituting security therefor;
(b) to advance or supply funds (i) for the purchase or payment of such
indebtedness or obligation, or (ii) to maintain any working capital or other
balance sheet condition or any income statement condition of any other Person or
otherwise to advance or make available funds for the purchase or payment of such
indebtedness or obligation;
(c) to lease properties or to purchase properties or services
primarily for the purpose of assuring the owner of such indebtedness or
obligation of the ability of any other Person to make payment of the
indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness or obligation
against loss in respect thereof.
In any computation of the indebtedness or other liabilities of the
obligor under any Guarantee, the indebtedness or other obligations that are the
subject of such Guarantee shall be assumed to be direct obligations of such
obligor.
"INDEBTEDNESS" with respect to any Person means, at any time, without
duplication,
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(a) its liabilities for borrowed money and its redemption obligations in
respect of mandatorily redeemable Preferred Stock;
(b) its liabilities for the deferred purchase price of property acquired by
such Person (excluding accounts payable arising in the ordinary course of
business but including all liabilities created or arising under any conditional
sale or other title retention agreement with respect to any such property);
(c) (i) all liabilities appearing on its balance sheet in accordance with
GAAP in respect of Capital Leases and (ii) all liabilities which would appear on
its balance sheet in accordance with GAAP in respect of Synthetic Leases
assuming such Synthetic Leases were accounted for as Capital Leases;
(d) all liabilities for borrowed money secured by any Lien with respect to
any property owned by such Person (whether or not it has assumed or otherwise
become liable for such liabilities);
(e) all its liabilities in respect of letters of credit or instruments
serving a similar function issued or accepted for its account by banks and other
financial institutions (whether or not representing obligations for borrowed
money);
(f) all Swap Contracts of such Person; and
(g) any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (f) hereof.
"INDEMNIFIED TAXES" shall mean Taxes other than Excluded Taxes.
"INITIAL CAPITALIZATION TRANSACTION" means the contribution by the
Parent to the Borrower prior to the Closing of the Installment Note and the
Letter of Credit with respect to membership interests constituting 100% of the
issued and outstanding equity capital of the Borrower, pursuant to a
Contribution Agreement and the operating agreement of the Borrower.
"INSTALLMENT NOTE" means that certain Purchase Note No. P-1 in the
principal amount of $43,170,000, dated November 15, 2007, issued by the
Installment Note Issuer, originally made payable to the order of the Parent, and
conveyed and transferred by the Parent to the Borrower pursuant to the
Contribution Agreement.
"INSTALLMENT NOTE ISSUER" means GIC Investments LLC, a Delaware
limited liability company.
"INSTALLMENT SALE TRANSACTION" means the sale by the Parent on
November 16, 2007 of its equity interests in two limited liability companies
formed to hold certain timberlands to the Installment Note Issuer, the purchase
price for which the Installment Note Issuer delivered to the Parent (a) the
Installment Note and (b) the Letter of Credit.
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"INSTALLMENT NOTE TRIGGER EVENT" means any of (a) a default in the
payment of any amount when due (whether on a scheduled payment date, upon
acceleration or otherwise) under the Installment Note that has not been cured
with the proceeds of a drawing under the Letter of Credit within 5 days
following such default; (b) failure of the Borrower to direct the Collateral
Trustee to accelerate the maturity of the Installment Note within 5 days
following the delivery by the L/C Bank of a Timely Reimbursement Failure Notice
(as such term is defined in the Letter of Credit); and (c) an insolvency event
relating to the L/C Bank.
"INTEREST PERIOD" means (i) initially, the period commencing on the
date hereof and ending on June 15, 2008 and (ii) thereafter, each period
commencing on the last day of the immediately preceding Interest Period and
ending on the 15th day of the sixth consecutive month ending after the month in
which such immediately preceding Interest Period ended. The determination of
Interest Periods shall be subject to the following provisions:
(i) if any Interest Period would otherwise expire on a day that is not a
Business Day, such Interest Period shall expire on the immediately
succeeding Business Day; provided, however, that if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day of
the month after which no further Business Day occurs in such month, such
Interest Period shall expire on the immediately preceding Business Day; and
(ii) no Interest Period shall extend beyond the stated maturity date
hereof.
"INTEREST RESERVE AMOUNT" means $350,000.
"INTEREST RESERVE ACCOUNT" means a trust account established by the
Collateral Trustee to hold certain amounts to be used to make payments on the
Term Loan.
"INVESTMENT COMPANY ACT" shall mean the United States Investment
Company Act of 1940, as amended.
"LC BANK" means the Royal Bank of Scotland plc, together with any
issuer of a substitute Letter of Credit.
"LETTER OF CREDIT" means that certain Irrevocable Standby Letter of
Credit No. LCA11020701586NY, in the initial "Base Amount" (as defined in said
letter of credit) of $43,170,000 issued by the LC Bank, together with any
substitute letter of credit that replaces such letter of credit pursuant to the
terms of the Installment Note.
"LIBOR" means, (i) 4.110625% per annum for the first Interest Period,
and (ii) for any subsequent Interest Period:
(a) an interest rate per annum appearing on page BBAM on the Bloomberg
Terminal ("Page BBAM") (or any other page that may replace such page from time
to time for the purpose of displaying offered rates of leading banks for London
interbank deposits in United States dollars) at approximately 11:00 a.m. (London
time) on the day that is two London
8
Business Days prior to the commencement of such Interest Period for United
States dollar deposits having a tenor equal to the duration of such Interest
Period;
(b) if a rate is not available, the rate per annum determined by the
Collateral Trustee to be the arithmetic mean (rounded, if necessary, to the
nearest fifth decimal place (with 5's being rounded up)) of the respective rates
of interest communicated by each of the Reference Banks to the Collateral
Trustee as the rates at which such Reference Banks would offer a United States
dollar deposit having a tenor equal to the duration of such Interest Period and
an amount at least equal to US$100 million to prime banks in the London
interbank market at approximately 11:00 a.m. (London time) on the day that is
two London Business Days prior to the commencement of such Interest Period;
provided, however, that if less than all Reference Banks provide such rate
quotations, then the Collateral Trustee shall determine the above-mentioned
arithmetic mean based on the rates quoted by those Reference Banks that provide
such a quotation, and if only one Reference Bank provides such a rate quotation,
then the Collateral Trustee shall use such sole Reference Bank's quoted rate; or
(c) if a rate cannot be determined pursuant to the foregoing
provisions, the LIBO Rate for such Interest Period shall be the rate per annum
determined by the Collateral Trustee to be the arithmetic mean (rounded, if
necessary, to the nearest fifth decimal place (with 5's being rounded up)) of
the respective rates of interest communicated by each of the Reference Banks to
the Collateral Trustee as the rates at which such Reference Banks would offer a
United States dollar deposit having a tenor equal to the duration of such
Interest Period and an amount at least equal to US$100 million to prime banks in
the New York interbank market at approximately 11:00 a.m. (New York City time)
on the first day of such Interest Period; provided, however, that if less than
all Reference Banks provide such rate quotations, then the Collateral Trustee
shall determine the above-mentioned arithmetic mean based on the rates quoted by
those Reference Banks that provide such a quotation, and if only one Reference
Bank provides such a rate quotation, then the Collateral Trustee shall use such
sole Reference Bank's quoted rate.
In respect of any Interest Period having a tenor other than six months, the
LIBO Rate shall be determined through the use of straight-line interpolation by
reference to two rates calculated in accordance with clauses (a), (b) and (c)
above, one of which shall be determined as if the maturity of the Dollar
deposits referred to therein were the period of time for which rates are
available next shorter than the Interest Period and the other of which shall be
determined as if the maturity were the period of time for which rates are
available next longer than the Interest Period; provided that, if an Interest
Period is less than or equal to seven days, then the LIBO Rate shall be
determined by reference to a rate calculated in accordance with clauses (a), (b)
and (c) above as if the maturity of the Dollar deposits referred to therein were
a period of time equal to seven days.
"LENDERS" shall have the meaning set forth in the introductory
paragraph of this Agreement.
"LIEN" shall mean any mortgage, pledge, security interest, lien
(statutory or otherwise), charge, encumbrance, hypothecation, assignment,
deposit arrangement, or other
9
arrangement having the practical effect of the foregoing or any preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including any conditional sale or other title retention
agreement and any capital lease having the same economic effect as any of the
foregoing).
"LOAN" shall have the meaning set forth in Section 2.01
"LOAN DOCUMENTS" shall mean, collectively, (a) this Agreement, (b) the
Term Note, (c) the Pledge and Security Agreement, (d) the Collateral Trust
Indenture, (e) any deposit account control agreement or securities account
control agreement, if any, governing the Interest Reserve Account, Collection
Account or any investments made with the proceeds of any cash or other items
standing to the credit of the Interest Reserve Account or Collection Account and
(f) any other certificate, instrument, document or agreement executed or
delivered by the Borrower to the Collateral Trustee, the Agent or any Lender.
"LONDON BUSINESS DAY" shall mean a day on which dealings in Dollars
are carried on in the London interbank market.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Borrower, or (b) the ability of the Borrower to perform its obligations under
this Agreement, the Term Note and the other Loan Documents, or (c) the validity
or enforceability of this Agreement, the Term Note or the other Loan Documents.
"MATURITY DATE" shall mean, with respect to the Term Loan, the earlier
of (i) January 15, 2013 or (ii) the date on which the principal amount of the
Term Loan has been declared or automatically have become due and payable
(whether by acceleration or otherwise).
"MEMBER" means the Parent in its capacity as the sole member of the
Borrower.
"MOODY'S" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTIEMPLOYER PLAN" means any Plan that is a "multiemployer plan" (as
such term is defined in section 4001(a)(3) of ERISA).
"NOTE" shall mean the Term Note.
"OBLIGATIONS" shall mean all amounts owing by the Borrower to the
Agent or any Lender pursuant to or in connection with this Agreement or any
other Loan Document, including without limitation, all principal, interest
(including any interest accruing after the filing of any petition in bankruptcy
or the commencement of any insolvency, reorganization or like proceeding
relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), all reimbursement
obligations, fees, expenses, indemnification and reimbursement payments, costs
and expenses (including all fees and expenses of counsel to the Agent and any
Lender incurred pursuant to this Agreement or any other Loan Document), whether
direct or indirect, absolute or contingent, liquidated or
10
unliquidated, now existing or hereafter arising hereunder or thereunder, and all
obligations to the Lender or any of its Affiliates, together with all renewals,
extensions, modifications or refinancings thereof.
"OFFICER'S CERTIFICATE" means a certificate of a Senior Financial
Officer or of another officer of the Borrower whose responsibilities extend to
the subject matter of such certificate.
"OTHER TAXES" shall mean any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.
"PARENT" means ▇▇▇▇▇▇▇▇▇▇ Pulp ▇▇▇▇ Company, a Maryland corporation
and a wholly-owned subsidiary of Glatfelter.
"PARTICIPANT" shall have the meaning set forth in Section 9.04(d).
"PAYMENT OFFICE" shall mean the office of the Agent located at
SunTrust Plaza, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other
location as to which the Agent shall have given written notice to the Borrower
and the Lenders.
"PERMITTED INVESTMENTS" means (a) marketable direct obligations issued
by, or unconditionally guaranteed by, the United States Government or issued by
any agency thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurocurrency time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any commercial bank organized under the laws of the United
States or any state thereof having combined capital and surplus and undivided
profits of not less than $1,000,000,000; (c) commercial paper of an issuer rated
at least A-1 by S&P or P-1 by Moody's, or carrying an equivalent rating by a
nationally recognized rating agency, if both of the two named rating agencies
cease publishing ratings of commercial paper issuers generally, and maturing
within six months from the date of acquisition; (d) repurchase obligations of
any commercial bank satisfying the requirements of clause (b) of this
definition, having a term of not more than 30 days, with respect to securities
issued or fully guaranteed or insured by the United States government; (e)
securities with maturities of one year or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the United
States, by any political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government, the securities of which
state, commonwealth, territory, political subdivision, taxing authority or
foreign government (as the case may be) are rated at least A+ by S&P or A1 by
Moody's; (f) securities with maturities of six months or less from the date of
acquisition backed by standby letters of credit issued by any commercial bank
satisfying the requirements of clause (b) of this definition; (g) money market
mutual or similar funds that invest exclusively in assets satisfying the
requirements of clauses (a) through (f) of this definition; (h) money market
funds that (1) comply with the criteria set forth in SEC Rule 2a-7 under the
Investment Company
11
Act of 1940, as amended and (2) are rated A+ by S&P and A1 by Moody's and (iii)
have portfolio assets of at least $100,000,000.
"PERSON" shall mean any individual, partnership, firm, corporation,
association, joint venture, limited liability company, trust or other entity, or
any Governmental Authority.
"PLAN" means an "employee benefit plan" (as defined in section 3(3) of
ERISA) subject to Title I of ERISA that is or has been established or
maintained, or to which contributions are or have been made or required to be
made, by the Borrower or any ERISA Affiliate with respect to which the Borrower
or any ERISA Affiliate may have any liability.
"PLEDGE AND SECURITY AGREEMENT" means that certain Pledge and Security
Agreement, dated as of January 15, 2008, between the Borrower and the Collateral
Trustee.
"PREFERRED STOCK" means any class of capital stock of a Person that is
preferred over any other class of capital stock (or similar equity interests) of
such Person as to the payment of dividends or the payment of any amount upon
liquidation or dissolution of such Person.
"PRO RATA SHARE" shall mean, with respect to any Lender at any time, a
percentage the numerator of which shall be the outstanding principal amount of
such Lender's portion of the Term Loan, and the denominator of which shall be
the outstanding principal amount of the Term Loan.
"PROPERTY" or "PROPERTIES" means, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, ▇▇▇▇▇▇
or inchoate.
"QUALIFIED PURCHASER" shall mean a "qualified purchaser" for purposes
of Section 3(c)(7) of the Investment Company Act and as defined in Section
2(a)(51) of the Investment Company Act.
"REGULATION D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System, as the same may be in effect from time to time, and
any successor regulations.
"REFERENCE BANKS" means The Royal Bank of Scotland plc, SunTrust Bank,
JPMorgan Chase Bank N.A. and The Bank of New York.
"RELATED PARTIES" shall mean, with respect to any specified Person,
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.
"REQUIRED LENDERS" means, at any time, Lenders holding greater than
50% of the principal amount of the Term Loan then outstanding.
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"RESPONSIBLE OFFICER" shall mean the President, any Vice-President,
the Treasurer, the Secretary, any Senior Financial Officer and any other officer
of the Borrower with responsibility for the administration of the relevant
portion of this Agreement.
"SENIOR FINANCIAL OFFICER" means the chief financial officer,
principal accounting officer, treasurer or comptroller of the Borrower.
"S&P" shall mean Standard & Poor's.
"SUBSIDIARY" shall mean, as to any Person, any other Person in which
such first Person or one or more of its Subsidiaries or such first Person and
one or more of its Subsidiaries owns sufficient equity or voting interests to
enable it or them (as a group) ordinarily, in the absence of contingencies, to
elect a majority of the directors (or Persons performing similar functions) of
such second Person, and any partnership or joint venture if more than a 50%
interest in the profits or capital thereof is owned by such first Person or one
or more of its Subsidiaries or such first Person and one or more of its
Subsidiaries (unless such partnership or joint venture can and does ordinarily
take major business actions without the prior approval of such Person or one or
more of its Subsidiaries). Unless the context otherwise clearly requires, any
reference to a "Subsidiary" is a reference to a Subsidiary of the Borrower.
"SWAP CONTRACT" means (a) any and all interest rate swap transactions,
basis swap transactions, basis swaps, credit derivative transactions, forward
rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond
index swaps or options or forward foreign exchange transactions, cap
transactions, floor transactions, currency options, spot contracts or any other
similar transactions or any of the foregoing (including, but without limitation,
any options to enter into any of the foregoing), and (b) any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, any form of master agreement
published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement.
"SYNTHETIC LEASE" means, at any time, any lease (including leases that
may be terminated by the lessee at any time) of any property (a) that is
accounted for as an operating lease under GAAP and (b) in respect of which the
lessee retains or obtains ownership of the property so leased for United States
federal income tax purposes, other than any such lease under which such Person
is the lessor.
"TAXES" means any income, stamp or other taxes, levies, imposts,
duties, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, excluding
net income taxes and franchise taxes (imposed in lieu of net income taxes)
imposed on any Lender as a result of a present or former connection between such
holder and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from such holder having executed, delivered or
received a payment under, or enforced, this Agreement or any other Loan
Document).
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"TERM LOAN" shall have the meaning set forth in Section 2.01.
"TERM LOAN COMMITMENT" shall mean, with respect to the Lender, the
obligation of the Lender to make the Term Loan hereunder on the Closing Date, in
a principal amount equal to $36,694,500.00.
"TERM NOTE" shall mean a Term Note of the Borrower payable to the
order of a Lender, in substantially the form of Exhibit A attached hereto.
"TYPE", when used in reference to the Term Loan, refers to whether the
rate of interest on such Loan is determined by reference to the Adjusted LIBO
Rate or the Base Rate.
"U.S. GOVERNMENT OBLIGATIONS" means marketable direct obligations
issued by, or unconditionally guaranteed by, the United States Government or
issued by any agency thereof and backed by the full faith and credit of the
United States.
"USA PATRIOT ACT" means United States Public Law 107-56, Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
SECTION 1.02 ACCOUNTING TERMS AND DETERMINATION
Unless otherwise defined or specified herein, all accounting terms used
herein shall be interpreted, all accounting determinations hereunder shall be
made, and all financial statements required to be delivered hereunder shall be
prepared, in accordance with GAAP as in effect from time to time, applied on a
basis consistent (except for such changes approved by the Borrower's independent
public accountants) with the most recent audited consolidated financial
statement of the Borrower delivered pursuant to Section 5.01(a).
SECTION 1.03 TERMS GENERALLY.
The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words
"include", "includes" and "including" shall be deemed to be followed by the
phrase "without limitation". The word "will" shall be construed to have the same
meaning and effect as the word "shall". In the computation of periods of time
from a specified date to a later specified date, the word "from" means "from and
including" and the word "to" means "to but excluding". Unless the context
requires otherwise (i) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as it was originally executed or as it
may from time to time be amended, supplemented or otherwise modified (subject to
any restrictions on such amendments, supplements or modifications set forth
herein), (ii) any reference herein to any Person shall be construed to include
such Person's successors and permitted assigns, (iii) the words "hereof",
"herein" and "hereunder" and words of similar import shall be construed to refer
to this Agreement as a whole and not to any particular provision
14
hereof, (iv) all references to Articles, Sections, Exhibits and Schedules shall
be construed to refer to Articles, Sections, Exhibits and Schedules to this
Agreement and (v) all references to a specific time shall be construed to refer
to the time in the city and state of the Agent's principal office, unless
otherwise indicated.
ARTICLE II. AMOUNT AND TERMS OF THE COMMITMENT
SECTION 2.01 TERM LOAN COMMITMENT.
(a) Subject to the terms and conditions set forth herein, the Lenders
agree to make a single loan (the "TERM LOAN" or the "LOAN") to the Borrower on
the Closing Date in a principal amount not to exceed the Term Loan Commitment;
provided, that if for any reason the full amount of the Term Loan Commitment is
not fully drawn on the Closing Date, the undrawn portion thereof shall
automatically be cancelled. Subject to Section 2.10 and Section 2.11, the Term
Loan shall be a Eurodollar Loan. The execution and delivery of this Agreement by
the Borrower and the satisfaction of all conditions precedent pursuant to
Article III shall be deemed to constitute the Borrower's request to borrow the
Term Loan on the Closing Date. The Term Loan (net of the Agent's fees and
expenses) shall be deposited in the Collection Account.
(b) The Borrower's obligation to pay the principal of, and interest
on, the Term Loan shall be evidenced by the records of the Agent and the Lenders
and by the Term Notes. The entries made in such records and on the schedule
annexed to the Term Notes shall be prima facie evidence of the existence and
amounts of the obligations of the Borrower therein recorded; provided, that the
failure or delay of the Agent or any Lender in maintaining or making entries
into any such record or on such schedule or any error therein shall not in any
manner affect the obligation of the Borrower to repay the Term Loan (both
principal and unpaid accrued interest) in accordance with the terms of this
Agreement.
SECTION 2.02 INTEREST ELECTION.
If, following the conversion of the Term Loan into a Base Rate Loan
pursuant to Section 2.10 or 2.11, the Agent determines (which determination
shall be conclusive and binding upon the Borrower) that it is possible to
ascertain LIBOR or that it is no longer unlawful to maintain or continue the
Term Loan as a Eurodollar Loan, as the case may be, then the Agent shall
promptly notify the Borrower and the Lenders of such determination. Following
such determination and notice, the Borrower shall have the right to convert the
Term Loan from a Base Rate Loan to a Eurodollar Loan in accordance with the
provisions of this Section 2.02. To make an election pursuant to this Section
2.02, the Borrower shall give the Agent prior written notice (or telephonic
notice promptly confirmed in writing) that the Term Loan is to be converted into
a Eurodollar Loan prior to 2:00 p.m. (Atlanta, Georgia time) three (3) Business
Days prior to such conversion. Such notice of conversion shall be irrevocable
and shall specify the effective date of the election.
SECTION 2.03 TERMINATION OF COMMITMENTS.
15
Unless previously terminated, the Term Loan Commitment shall terminate
on the Closing Date upon the making of the Term Loan pursuant to Section 2.01.
SECTION 2.04 REPAYMENT OF TERM LOAN.
The Borrower unconditionally promises to pay to the Agent for the
account of the Lenders the principal amount of the Term Loan on the Maturity
Date.
SECTION 2.05 OPTIONAL PREPAYMENTS.
(a) The Borrower shall have the right at any time and from time to
time to prepay the Term Loan, in whole or in part, without premium or penalty,
by giving irrevocable written notice (or telephonic notice promptly confirmed in
writing) to the Agent no later than 11:00 a.m. not less than three (3) Business
Days prior to any such prepayment. Each such notice shall be irrevocable and
shall specify the proposed date of such prepayment and the principal amount of
the Term Loan or portion thereof to be prepaid. Upon receipt of any such notice,
the Agent shall promptly notify each Lender of the contents thereof and of such
Lender's Pro Rata Share of any such prepayment. Such amount shall be due and
payable on the date designated in such notice, together with accrued interest to
such date on the amount so prepaid in accordance with Section 2.07; provided,
that if the Term Loan is prepaid on a date other than the last day of an
Interest Period applicable thereto, the Borrower shall also pay all amounts
required pursuant to Section 2.13.
(b) Unless a Default or an Event of Default has occurred and is
continuing, any prepayments made by the Borrower pursuant to Section 2.05(a)
above shall be applied as follows: first, to the Agent's fees and reimbursable
expenses then due and payable pursuant to any of the Loan Documents; second, to
all fees and reimbursable expenses of the Lenders then due and payable pursuant
to any of the Loan Documents, pro rata to the Lenders based on their respective
Pro Rata Shares of such expenses; third, to interest then due and payable on the
Term Loan, pro rata to the Lenders based on their respective Pro Rata Shares of
the Term Loan; and fourth, to the principal balance of the Term Loan, until the
same shall have been paid in full, pro rata to the Lenders based on their
respective Pro Rata Shares of the Term Loan.
SECTION 2.06 MANDATORY PREPAYMENTS.
In the event the Installment Note shall become immediately due and payable
for any reason, the Borrower shall prepay, within two Business Days following
such event, the entire principal amount of the Term Loan then outstanding, plus
all amounts required pursuant to Section 2.13. The Borrower will give the Agent
and each Lender written notice of a mandatory prepayment under this Section
2.06. Each such notice shall specify such date (which shall be a Business Day),
the aggregate principal amount of the Term Loan to be prepaid on such date, and
the interest to be paid on the prepayment date with respect to such principal
amount being prepaid, and shall be accompanied by a certificate of a Responsible
Officer as to all amounts required pursuant to Section 2.13 in connection with
such prepayment, setting forth the details of such computation.
SECTION 2.07 INTEREST ON TERM LOAN.
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(a) The Borrower shall pay to the Agent interest on any Base Rate Loan
at the Base Rate in effect from time to time and on any Eurodollar Loan at the
Adjusted LIBO Rate for the applicable Interest Period in effect, plus, in each
case, the Applicable Margin in effect from time to time.
(b) While an Event of Default exists, the Borrower shall pay interest
("DEFAULT INTEREST") at the rate otherwise applicable plus an additional 2% per
annum.
(c) Interest on the principal amount of the Term Loan shall accrue
from and including the date made to but excluding the date of any repayment
thereof.
(d) Interest on any outstanding Base Rate Loan shall be payable
semi-annually in arrears on the fifteenth day of each June and December, and on
the Maturity Date. Interest on any outstanding Eurodollar Loan shall be payable
on the last day of each Interest Period applicable thereto, and on the Maturity
Date. If the Term Loan is converted into a Loan of another Type or repaid or
prepaid, interest shall be payable on the date of such conversion or on the date
of any such repayment or prepayment (on the amount repaid or prepaid) thereof.
All Default Interest shall be payable on demand.
(e) The Agent shall determine each interest rate applicable to the
Term Loan hereunder and shall promptly notify the Borrower of such rate in
writing (or by telephone, promptly confirmed in writing). Any such determination
shall be conclusive and binding for all purposes, absent manifest error.
SECTION 2.08 FEES.
The Borrower shall pay to the Agent the fees set forth in the Fee
Letter.
SECTION 2.09 COMPUTATION OF INTEREST.
All computations of interest hereunder (other than interest based on
the Base Rate) shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such interest or fees are payable (to the extent computed
on the basis of days elapsed). Interest based on the Base Rate shall be
calculated on the basis of a 365-day year (or 366-day year, as the case may be)
for the actual days elapsed. Each determination by the Agent of an interest
amount hereunder shall be made in good faith and, except for manifest error,
shall be final, conclusive and binding for all purposes.
SECTION 2.10 INABILITY TO DETERMINE INTEREST RATES.
If prior to the commencement of any Interest Period, the Agent shall
have determined (which determination shall be conclusive and binding upon the
Borrower) that, by reason of circumstances affecting the relevant interbank
market, adequate means do not exist for ascertaining LIBOR for such Interest
Period, the Agent shall give written notice (or telephonic
17
notice, promptly confirmed in writing) to the Borrower and to the Lenders as
soon as practicable thereafter. Until the Agent shall notify the Borrower and
the Lenders that the circumstances giving rise to such notice no longer exist,
(i) the obligations of the Lenders to maintain the Term Loan as a Eurodollar
Loan shall be suspended and (ii) the Term Loan shall be converted into a Base
Rate Loan on the last day of the then current Interest Period applicable thereto
unless the Borrower prepays the Term Loan in accordance with this Agreement.
SECTION 2.11 ILLEGALITY.
If any Change in Law shall make it unlawful or impossible for any Lender to
make, maintain or fund any Eurodollar Loan and such Lender shall so notify the
Agent, the Agent shall promptly give notice thereof to the Borrower and the
other Lenders, whereupon until such Lender notifies the Agent and the Borrower
that the circumstances giving rise to such suspension no longer exist, the
obligation of the Lenders to continue the Term Loan as a Eurodollar Loan, shall
be suspended. The Term Loan shall be converted to a Base Rate Loan either (i) on
the last day of the then current Interest Period applicable to such Eurodollar
Loan if such Lender may lawfully continue to maintain the Term Loan to such date
or (ii) immediately if such Lender shall determine that it may not lawfully
continue to maintain such Eurodollar Loan to such date. Notwithstanding the
foregoing, the affected Lender shall, prior to giving such notice to the Agent,
designate a different Applicable Lending Office if such designation would avoid
the need for giving such notice and if such designation would not otherwise be
disadvantageous to such Lender in the good faith exercise of its discretion.
SECTION 2.12 INCREASED COSTS.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special
deposit or similar requirement that is not otherwise included in the
determination of the Adjusted LIBO Rate hereunder against assets of, deposits
with or for the account of, or credit extended by, any Lender (except any such
reserve requirement reflected in the Adjusted LIBO Rate); or
(ii) impose on any Lender or the eurodollar interbank market any
other condition affecting this Agreement or any Eurodollar Loan made by such
Lender or any participation therein;
and the result of either of the foregoing is to increase the cost to such Lender
of making or maintaining a Eurodollar Loan or to reduce the amount received or
receivable by such Lender hereunder (whether of principal, interest or any other
amount), then the Borrower shall promptly pay, as set forth in paragraph (c)
below, to the Agent for the account of such Lender, additional amount or amounts
sufficient to compensate such Lender for such additional costs incurred or
reduction suffered.
(b) If any Lender shall have determined that on or after the date of
this Agreement any Change in Law regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender's capital (or on
the capital of such Lender's parent corporation) as
18
a consequence of its obligations hereunder to a level below that which such
Lender or such Lender's parent corporation could have achieved but for such
Change in Law (taking into consideration such Lender's policies or the policies
of such Lender's parent corporation with respect to capital adequacy) then, from
time to time, as set forth in paragraph (c) below, the Borrower shall pay to
such Lender such additional amounts as will compensate such Lender or such
Lender's parent corporation for any such reduction suffered.
(c) A certificate of a Lender setting forth the amount or amounts
necessary to compensate such Lender or such Lender's parent corporation, as the
case may be, specified in paragraph (a) or (b) of this Section 2.12 shall be
delivered to the Borrower (with a copy to the Agent) and shall be conclusive,
absent manifest error. The Borrower shall pay any such Lender such amount or
amounts within 10 days after receipt thereof; provided that the Borrower shall
not be required to make any such payment prior to the last day of the then
current Interest Period if Borrower does not have funds available to make such
payment.
(d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section 2.12 shall not constitute a waiver of such Lender's
right to demand such compensation.
(e) If any Lender shall seek any additional amount or amounts under
this Section 2.12, at the written request of the Borrower, such Lender shall
designate a different Applicable Lending Office if such designation would avoid
the need for or would reduce such amount or amounts and if such designation
would not otherwise be disadvantageous to such Lender in the good faith exercise
of its discretion.
SECTION 2.13 FUNDING INDEMNITY.
In the event of (a) the payment of any principal of a Eurodollar Loan other
than on the last day of the Interest Period applicable thereto (including as a
result of an Event of Default), or (b) the conversion of a Eurodollar Loan other
than on the last day of the Interest Period applicable thereto, or (c) the
failure by the Borrower to prepay any Eurodollar Loan on the date specified in
any applicable notice (regardless of whether such notice is withdrawn or
revoked), then, in any such event, the Borrower shall compensate each Lender,
within five (5) Business Days after written demand from such Lender, for any
loss, cost or expense attributable to such event. In the case of a Eurodollar
Loan, such loss, cost or expense shall be deemed to include an amount determined
by such Lender to be the excess, if any, of (A) the amount of interest that
would have accrued on the principal amount of such Eurodollar Loan if such event
had not occurred at the Adjusted LIBO Rate applicable to such Eurodollar Loan
for the period from the date of such event to the last day of the then current
Interest Period therefor over (B) the amount of interest that would accrue on
the principal amount of such Eurodollar Loan for the same period if the Adjusted
LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted. A
certificate as to any additional amount payable under this Section 2.13
submitted to the Borrower by any Lender (with a copy to the Agent) shall be
conclusive, absent manifest error.
SECTION 2.14 TAXES.
19
(a) Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of and without deduction for any
Indemnified Taxes or Other Taxes; provided, that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 2.14) the Agent or any Lender (as the case may be) shall
receive an amount equal to the sum it would have received had no such deductions
been made, (ii) the Borrower shall make such deductions and (iii) the Borrower
shall pay the full amount deducted to the relevant Governmental Authority in
accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Agent and each Lender, within ten
(10) Business Days after written demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes paid by the Agent or such Lender, as the case
may be, on or with respect to any payment by or on account of any obligation of
the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section 2.14) and any
penalties, interest and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
A certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender or by the Agent on its own behalf or on behalf of a Lender,
shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the Code or any treaty to which the United
States is a party, with respect to payments under this Agreement shall deliver
to the Borrower (with a copy to the Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law or reasonably requested by the Borrower as will permit such
payments to be made without withholding or at a reduced rate. Without limiting
the generality of the foregoing, each Foreign Lender agrees that it will deliver
to the Agent and the Borrower (or in the case of a Participant, to the Lender
from which the related participation shall have been purchased), as appropriate,
two (2) duly completed copies of (i) Internal Revenue Service Form W-8 ECI, or
any successor form thereto, certifying that the payments received from the
Borrower hereunder are effectively connected with such Foreign Lender's conduct
of a trade or business in the United States; or (ii) Internal Revenue Service
Form W-8 BEN, or any successor form thereto, certifying that such Foreign Lender
is entitled to benefits under an income tax treaty to which the United States is
a party which reduces the rate of withholding tax on payments of interest; or
(iii) Internal Revenue Service Form W-8 BEN, or any successor form
20
prescribed by the Internal Revenue Service, together with a certificate (A)
establishing that the payment to the Foreign Lender qualifies as "portfolio
interest" exempt from U.S. withholding tax under Code Section 871(h) or 881(c),
and (B) stating that (1) the Foreign Lender is not a bank for purposes of Code
Section 881(c)(3)(A), or the obligation of the Borrower hereunder is not, with
respect to such Foreign Lender, a loan agreement entered into in the ordinary
course of its trade or business, within the meaning of that section; (2) the
Foreign Lender is not a 10% shareholder of the Borrower within the meaning of
Code Section 871(h)(3) or 881(c)(3)(B); and (3) the Foreign Lender is not a
controlled foreign corporation that is related to the Borrower within the
meaning of Code Section 881(c)(3)(C); or (iv) such other Internal Revenue
Service forms as may be applicable to the Foreign Lender, including Forms W-8
IMY or W-8 EXP. Each such Foreign Lender shall deliver to the Borrower and the
Agent such forms on or before the date that it becomes a party to this Agreement
(or in the case of a Participant, on or before the date such Participant
purchases the related participation) and periodically thereafter at the time or
times prescribed by applicable laws, including without limitation, promptly upon
the obsolescence or invalidity of any form previously delivered by such Foreign
Lender. Each such Foreign Lender shall promptly notify the Borrower and the
Agent at any time that it determines that it is no longer in a position to
provide any previously delivered certificate to the Borrower (or any other form
of certification adopted by the Internal Revenue Service for such purpose).
(f) If a Lender or the Agent determines in its sole discretion that it
is entitled to claim a refund from a taxing authority in respect of amounts paid
by a Borrower pursuant to this Section 2.14, such Lender or Agent shall promptly
notify Borrower and Agent (as applicable) of the availability of such claim and,
if the Lender or the Agent (as applicable) determines in its sole discretion
that making such refund claim could not reasonably be expected to have an
adverse effect on its Taxes or business operations, shall make such claim. If
the Agent or a Lender determines, in its sole discretion, that it has received a
refund against any Taxes (including without limitation by way of offset) as to
which it has been indemnified by the Borrower or with respect to which Borrower
has paid additional amounts pursuant to this Section 2.14, it shall pay over
such refund or credit to Borrower (but only to the extent of amounts paid by
Borrower under this Section 2.14), net of all out-of-pocket expenses of such
Lender or the Agent and without interest (other than any interest paid by the
relevant taxing authority with respect to such refund); provided, however, that
the Borrower, upon the request of the Agent or such Lender, agrees to repay the
amount paid over to the Borrower to such Lender or the Agent in the event such
Lender or the Agent is required to repay such refund to such taxing authority.
This Section shall not be construed to require the Agent or any Lender to make
available its Tax returns (or any other information relating to its Taxes that
it deems confidential) to the Borrower or any other Person.
(g) If any Lender shall seek any additional amount or amounts under
this Section 2.14, at the written request of the Borrower, such Lender shall
designate a different Applicable Lending Office if such designation would avoid
the need for or would reduce such amount or amounts and if such designation
would not otherwise be disadvantageous to such Lender in the good faith exercise
of its discretion.
SECTION 2.15 PAYMENTS GENERALLY; PRO RATA TREATMENT; SHARING OF
SET-OFFS.
21
(a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or otherwise) to the Agent prior
to noon (Atlanta, Georgia time) on the date when due, in immediately available
funds, free and clear of any rights of set-off or counterclaim. Any amounts
received after such time on any date may, in the discretion of the Agent, be
deemed to have been received on the next succeeding Business Day for purposes of
calculating interest thereon. All such payments shall be made to the Agent at
the Payment Office. The Agent shall distribute any such payments received by it
for the account of any other Person to the appropriate recipient promptly
following receipt thereof. If any payment hereunder shall be due on a day that
is not a Business Day, the date for payment shall be extended to the next
succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be made payable for the period of such extension. All
payments hereunder shall be made in Dollars.
(b) If at any time insufficient funds are received by and available to
the Agent to pay fully all amounts of principal, interest and other amounts then
due hereunder, such funds shall be applied (i) first, towards payment of
interest and other amounts then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of interest and other amounts
then due to such parties, and (ii) second, towards payment of principal then due
hereunder, ratably among the parties entitled thereto in accordance with the
amounts of principal then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on the Term Loan that would result in such Lender receiving payment of
a greater proportion of the aggregate amount of its Pro Rata Share of the Term
Loan and accrued interest thereon than the proportion received by any other
Lender, then the Lender receiving such greater proportion shall purchase (for
cash at face value) participations in the Pro Rata Shares of the Term Loan of
other Lenders to the extent necessary so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggregate amount
of principal of and accrued interest on their respective Pro Rata Shares of the
Term Loan; provided, that (i) if any such participations are purchased and all
or any portion of the payment giving rise thereto is recovered, such
participations shall be rescinded and the purchase price restored to the extent
of such recovery, without interest, and (ii) the provisions of this paragraph
shall not be construed to apply to any payment made by the Borrower pursuant to
and in accordance with the express terms of this Agreement or any payment
obtained by a Lender as consideration for the assignment of or sale of a
participation in the Term Loan to any assignee or participant, other than to the
Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of
this paragraph shall apply). The Borrower consents to the foregoing and agrees,
to the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise
against the Borrower rights of set-off and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of the Borrower
in the amount of such participation.
(d) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due to the Agent for the account of
the Lenders hereunder that the Borrower will not make such payment, the Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption,
22
distribute to the Lenders the amount or amounts due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Agent forthwith on demand the amount so distributed to
such Lender with interest thereon, for each day from and including the date such
amount is distributed to it to but excluding the date of payment to the Agent,
at the greater of the Federal Funds Rate and a rate determined by the Agent in
accordance with banking industry rules on interbank compensation.
(e) If any Lender shall fail to make any payment required to be made
by it, then the Agent may, in its discretion (notwithstanding any contrary
provision hereof), apply any amounts thereafter received by the Agent for the
account of such Lender to satisfy such Lender's obligations under such Sections
until all such unsatisfied obligations are fully paid.
ARTICLE III. CONDITIONS PRECEDENT
The obligations of the Lenders to make the Term Loan are subject to the
fulfillment to such Lenders' satisfaction, prior to or at the Closing, of the
following conditions:
SECTION 3.01 REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the Borrower in this Agreement and
the other Loan Documents shall be correct when made and at the time of the
Closing.
SECTION 3.02 PERFORMANCE; NO DEFAULT.
The Borrower shall have performed and complied with all agreements and
conditions contained in this Agreement required to be performed or complied with
by it prior to or at the Closing, and after giving effect to the making of the
Term Loan (and the application of the proceeds thereof as contemplated by
Section 4.14) no Default or Event of Default shall have occurred and be
continuing.
SECTION 3.03 COMPLIANCE CERTIFICATES.
(a) Officer's Certificate. The Borrower shall have delivered to such
Lender an Officer's Certificate, dated the date of the Closing, certifying that
the conditions specified in Sections 3.01, 3.02, 3.05 and 3.09 have been
fulfilled.
(b) Secretary's Certificate. The Borrower shall have delivered to such
Lender a certificate of its Secretary or other Responsible Officer, dated the
date of Closing, certifying as to the resolutions attached thereto and other
company proceedings relating to the authorization, execution and delivery of
this Agreement and the other Loan Documents.
SECTION 3.04 OPINIONS OF COUNSEL.
(a) Such Lender shall have received opinions in form and substance
reasonably satisfactory to such Lender, dated the date of the Closing:
23
(i) from ▇▇▇▇ & ▇▇▇▇▇ LLP, counsel to the Borrower, the Parent and
Glatfelter, covering such Delaware, Maryland and Pennsylvania law matters
incident to the entry into this Agreement, the Capitalization Transaction, the
issuance of the Glatfelter Securities and the other transactions contemplated
hereby as such Lender or its counsel may reasonably request (and the Borrower
hereby instructs its counsel to deliver such opinion to the Lenders);
(ii) from Debevoise & ▇▇▇▇▇▇▇▇ LLP, counsel for the Borrower, the
Parent and Glatfelter, covering such New York and Federal law matters incident
to the entry into this Agreement, the Capitalization Transaction, the issuance
of the Glatfelter Securities and the other transactions contemplated hereby as
such Lender or its counsel may reasonably request (and the Borrower hereby
instructs its counsel to deliver such opinion to the Lenders);
(iii) from Debevoise & ▇▇▇▇▇▇▇▇ LLP, counsel for the Borrower,
regarding the nonconsolidation of the Borrower in a bankruptcy of Glatfelter or
any of its Subsidiaries and the true sale or true contribution of the assets of
the Parent sold or contributed pursuant to the Capitalization Transaction.
(b) Such Lender shall have received copies of the following opinions
dated the date of issuance of the Installment Note and Letter of Credit:
(i) from Dundas & ▇▇▇▇▇▇ ▇▇ LLP, counsel to the LC Issuer, covering
certain Scottish law matters relating to the LC Issuer and the Letter of Credit;
(ii) from ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel to the LC Issuer, covering
certain New York and Federal law matters relating to the LC Issuer and the
Letter of Credit;
(iii) from ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel to the
Installment Note Issuer, covering certain matters relating to the Installment
Note Issuer and the Installment Note; and
(iv) from ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel to the Installment
Note Issuer, regarding the nonconsolidation of the Installment Note Issuer in a
bankruptcy of its parent company or of its Subsidiaries.
SECTION 3.05 INSTALLMENT SALE TRANSACTION; INITIAL CAPITALIZATION
TRANSACTION.
The Installment Sale Transaction and the Initial Capitalization Transaction
shall have been consummated.
SECTION 3.06 TRANSACTION DOCUMENTS.
The Collateral Trustee shall have received (i) this Agreement, executed by
the Borrower and each Lender, (ii) the Pledge and Security Agreement, executed
by the Borrower and the Collateral Trustee, (iii) the Collateral Trust
Indenture, executed by the Borrower and the Collateral Trustee and (iv) the
other Loan Documents.
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SECTION 3.07 COLLATERAL.
(a) Installment Note. The Collateral Trustee shall have received the
Installment Note, together with a transfer instrument executed by the Borrower
naming the Collateral Trustee as transferee. The Installment Note and instrument
of transfer shall have been submitted to the "Paying Agent" referenced in the
Installment Note for registration of transfer, and such Paying Agent shall have
registered such transfer, recorded the transfer on the Installment Note and
delivered the Installment Note to the Collateral Trustee.
(b) Letter of Credit. The Collateral Trustee shall have received the
Letter of Credit, together with a "Request for Full Transfer" referenced therein
executed by the Borrower naming the Collateral Trustee as transferee. The Letter
of Credit and such Request for Full Transfer shall have been submitted to the LC
Bank, and the LC Bank shall have delivered to the Collateral Trustee the Letter
of Credit duly endorsed for transfer and accompanied by the LC Bank's customary
letter of transfer to the Collateral Trustee.
(c) Glatfelter Securities. The Collateral Trustee shall have received
the Glatfelter Securities, together with undated transfer instruments executed
by the Borrower.
(d) Contribution Agreement. The Collateral Trustee shall have received
a fully executed copy of the Contribution Agreement, certified by a Responsible
Officer of the Borrower as a true and complete copy thereof.
(e) Evidence of Perfection; Uniform Commercial Code Financing
Statement. The Collateral Trustee shall have received such evidence (including,
without limitation, evidence of the filing of appropriate UCC-1 financing
statements) as the Collateral Trustee may require as to the perfection of the
security interest created by the Pledge and Security Agreement in the
Collateral.
(f) Lien Searches. The Collateral Trustee shall have received written
reports of Uniform Commercial Code, judgment and tax lien searches of the Parent
and the Borrower in all appropriate jurisdictions, showing the absence of any
liens attaching to any of the Collateral.
SECTION 3.08 INTEREST RESERVE ACCOUNT AND COLLECTION ACCOUNT.
The Collateral Trustee shall have received evidence of (a) the
establishment of the Interest Reserve Account, and (b) the establishment of the
Collection Account.
SECTION 3.09 INTEREST RESERVE AMOUNT.
The Collateral Trustee shall have received evidence, in the form of a
certification by the Borrower pursuant to Section 3.03(a), that the Interest
Reserve Amount will be deposited into the Interest Reserve Account immediately
following the Closing.
SECTION 3.10 TERM LOAN PERMITTED BY APPLICABLE LAW, ETC.
25
On the date of the Closing such Lender's making of the Term Loan shall (a)
be permitted by the laws and regulations of each jurisdiction to which such
Lender is subject, (b) not violate any applicable law or regulation (including,
without limitation, Regulation T, U or X of the Board of Governors of the
Federal Reserve System) and (c) not subject such Lender to any tax, penalty or
liability under or pursuant to any applicable law or regulation, which law or
regulation was not in effect on the date hereof. If requested by such Lender,
such Lender shall have received an Officer's Certificate certifying as to such
matters of fact as such Lender may reasonably specify to enable such Lender to
determine whether such purchase is so permitted.
SECTION 3.11 PAYMENT OF SPECIAL COUNSEL FEES.
The Borrower shall have paid on or before the Closing or made provision for
the payment on or before the Closing of the fees, charges and disbursements of
the Lender's special counsel to the extent reflected in a statement of such
counsel rendered to the Borrower at least two Business Days prior to the
Closing.
SECTION 3.12 FUNDING INSTRUCTIONS.
At least three Business Days prior to the date of the Closing, the Agent
shall have received written instructions signed by a Responsible Officer
providing wire instructions for the disbursement of the proceeds of the Term
Loan.
SECTION 3.13 PROCEEDINGS AND DOCUMENTS.
All corporate and other proceedings in connection with the transactions
contemplated by this Agreement and all documents and instruments incident to
such transactions shall be satisfactory to such Lender, and such Lender shall
have received all such counterpart originals or certified or other copies of
such documents as such Lender may reasonably request.
ARTICLE IV. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Agent and each Lender as
follows:
SECTION 4.01 ORGANIZATION; POWER AND AUTHORITY.
The Borrower is a limited liability company duly formed, validly existing
and in good standing under the laws of its jurisdiction of formation, and is
duly qualified as a foreign limited liability company and is in good standing in
each jurisdiction in which such qualification is required by law. The Borrower
has the limited liability company power and authority to own or hold under lease
the properties it purports to own or hold under lease, to transact the business
it transacts and proposes to transact, to execute and deliver this Agreement,
the Note and the other Loan Documents and to perform the provisions hereof and
thereof.
SECTION 4.02 AUTHORIZATION, ETC.
26
This Agreement, the Note and the other Loan Documents have been duly
authorized by all necessary limited liability company action on the part of the
Borrower, and this Agreement and the other Loan Documents (other than the Note)
constitute, and upon execution and delivery thereof the Note will constitute,
legal, valid and binding obligations of the Borrower enforceable against the
Borrower in accordance with their terms, except as such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
SECTION 4.03 DISCLOSURE.
This Agreement, the other Loan Documents and the Closing Date Balance Sheet
(this Agreement, the other Loan Documents, and such Closing Date Balance Sheet
being referred to, collectively, as the "Disclosure Documents"), taken as a
whole, do not contain any material misstatement of fact or omit to state any
material fact necessary to make the statements therein not misleading in light
of the circumstances under which they were made.
SECTION 4.04 ORGANIZATION AND OWNERSHIP OF SHARES OF SUBSIDIARIES.
The Borrower has no Subsidiaries.
SECTION 4.05 CLOSING DATE BALANCE SHEET; LIABILITIES.
The Borrower has delivered to each Lender a copy of the Closing Date
Balance Sheet. The Closing Date Balance Sheet fairly presents in all material
respects the financial position of the Borrower as of the Closing Date and has
been prepared in accordance with GAAP. The Borrower does not have any
liabilities that are not disclosed on Closing Date Balance Sheet or otherwise
disclosed in the Disclosure Documents.
SECTION 4.06 COMPLIANCE WITH LAWS, OTHER INSTRUMENTS, ETC.
The execution, delivery and performance by the Borrower of this Agreement
and the other Loan Documents will not (i) contravene, result in any breach of,
or constitute a default under, or result in the creation of any Lien in respect
of any property of the Borrower under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, the Borrower's certificate of
formation or operating agreement, or any other agreement or instrument to which
the Borrower is bound or by which the Borrower or any of its properties may be
bound or affected, (ii) conflict with or result in a breach of any of the terms,
conditions or provisions of any order, judgment, decree, or ruling of any court,
arbitrator or Governmental Authority applicable to the Borrower or (iii) violate
any provision of any statute or other rule or regulation of any Governmental
Authority applicable to the Borrower.
SECTION 4.07 GOVERNMENTAL AUTHORIZATIONS, ETC.
27
No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Borrower of this Agreement or the
other Loan Documents.
SECTION 4.08 LITIGATION; OBSERVANCE OF STATUTES AND ORDERS.
(a) There are no actions, suits, investigations or proceedings pending
or, to the knowledge of the Borrower, threatened against or affecting the
Borrower or any property of the Borrower in any court or before any arbitrator
of any kind or before or by any Governmental Authority.
(b) The Borrower is not in default under any order, judgment, decree
or ruling of any court, arbitrator or Governmental Authority or is in violation
of any applicable law, ordinance, rule or regulation (including without
limitation the USA Patriot Act) of any Governmental Authority.
SECTION 4.09 TAXES.
The Borrower has filed all income tax returns that are required to have
been filed in any jurisdiction, and has paid all taxes shown to be due and
payable on such returns and all other taxes and assessments payable by it, to
the extent such taxes and assessments have become due and payable and before
they have become delinquent. The Borrower has been and will be characterized and
treated as an entity disregarded as separate for income tax purposes.
SECTION 4.10 TITLE TO PROPERTY.
The Borrower has good and sufficient title to its properties, including all
such properties reflected in the Closing Date Balance Sheet, in each case free
and clear of Liens.
SECTION 4.11 LICENSES, PERMITS, ETC.
The Borrower owns or possesses all licenses, permits, franchises,
authorizations, patents, copyrights, proprietary software, service marks,
trademarks and trade names, or rights thereto, required for the conduct of its
business, without known conflict with the rights of others.
SECTION 4.12 COMPLIANCE WITH ERISA.
(a) The Borrower and each ERISA Affiliate have operated and
administered each Plan in compliance in all material respects with all
applicable laws. Neither the Borrower nor any ERISA Affiliate has any material
liability pursuant to Title I or IV of ERISA with respect to a Plan or any
material liability under the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in section 3 of ERISA), and no
event, transaction or condition has occurred or exists that would reasonably be
expected to result in the incurrence of any such material liability by the
Borrower or any ERISA Affiliate, or in the imposition of any Lien on any of the
rights, properties or assets of the Borrower or any ERISA Affiliate, in either
28
case pursuant to Title I or IV of ERISA or to such penalty or excise tax
provisions or to section 401(a)(29) or 412 of the Code or section 4068 of ERISA.
(b) The present value of the aggregate benefit liabilities under each
of the Plans subject to Title IV of ERISA (other than Multiemployer Plans),
determined as of the end of such Plan's most recently ended plan year on the
basis of the actuarial assumptions specified for funding purposes in such Plan's
most recent actuarial valuation report, did not exceed the aggregate current
value of the assets of such Plan allocable to such benefit liabilities, in each
case as set forth in such most recent actuarial valuation report. In addition,
if each of the Plans were to terminate as of such Plan's most recently ended
plan year in a "standard termination" (within the meaning of Section 4041 of
ERISA), the additional contributions required to be made by the contributing
sponsor of such Plan in connection with such termination would not reasonably be
expected to be material.
(c) The Borrower and its ERISA Affiliates have not incurred withdrawal
liabilities under section 4201 or 4204 of ERISA in respect of any Multiemployer
Plan which have not been satisfied in full, and no event, transaction or
condition has occurred or exists that would reasonably be expected to result in
the assessment of any additional material withdrawal liabilities under section
4201 or section 4204 of ERISA in respect of any Multiemployer Plan, and neither
the Borrower nor its ERISA Affiliates has any material contingent withdrawal
liabilities under section 4204 of ERISA in respect of any Multiemployer Plan.
(d) The Borrower does not have any expected postretirement benefit
obligation determined as of the last day of the Borrower's most recently ended
fiscal year in accordance with Financial Accounting Standards Board Statement
No. 106, without regard to liabilities attributable to continuation coverage
mandated by section 4980B of the Code.
(e) Assuming that no Lender funds any portion of the Term Loan with
"plan assets" (within the meaning of Section 3(42) of ERISA), the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby will not involve any transaction that is subject to the prohibitions of
section 406 of ERISA or in connection with which a tax could be imposed pursuant
to section 4975(c)(1)(A) (D) of the Code.
SECTION 4.13 [Reserved]
SECTION 4.14 USE OF PROCEEDS; MARGIN REGULATIONS.
No part of the proceeds from the Term Loan hereunder will be used, directly
or indirectly, for the purpose of buying or carrying any margin stock within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System
(12 CFR 221), or for the purpose of buying or carrying or trading in any
securities under such circumstances as to involve the Borrower in a violation of
Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). None of the assets of the
Borrower constitute margin stock, and the Borrower does not have any present
intention that margin stock will constitute more any portion of such assets. As
used in this Section, the terms
29
"margin stock" and "purpose of buying or carrying" shall have the meanings
assigned to them in said Regulation U.
SECTION 4.15 INDEBTEDNESS.
(a) The Borrower has no outstanding Indebtedness other than the Term
Loan.
(b) The Borrower is not a party to, or otherwise subject to any
provision contained in, any instrument or agreement (other than its certificate
of formation, its operating agreement and this Agreement) which limits the
amount of, or otherwise imposes restrictions on the incurring of, Indebtedness
of the Borrower, except as disclosed on Schedule 4.15.
SECTION 4.16 SOLVENCY.
After giving effect to the Term Loan pursuant to this Agreement, the
Borrower will be "solvent" and for purposes hereof, the term "solvent" shall
mean that (a) the fair value of the property of the Borrower is greater than the
total amount of its liabilities (including contingent liabilities), (b) the
present fair saleable value of its property is not less than the amount that
will be required to pay the probable liability on its debts as they become
absolute and matured, (c) the Borrower does not intend to, and does not believe
that it will, incur debts or liabilities beyond its ability to pay as such debts
and liabilities mature, and (d) the Borrower is not engaged in a business for
which its property would constitute an unreasonably small capital.
SECTION 4.17 ACTIVITIES.
Since the date of formation of the Borrower, the Borrower has taken all
steps reasonably required by its certificate of formation and limited liability
company agreement to continue its identity as a separate legal entity and to
make it apparent to other Persons that the Borrower is an entity with assets and
liabilities distinct from those of any other Person. Without limiting the
foregoing, since the date of formation of the Borrower, the Borrower has (i)
been a limited purpose company whose activities have been restricted in its
certificate of formation and operating agreement, (ii) maintained books,
records, accounts, assets and financial statements separate from any other
Person and otherwise held itself out as an entity separate from any other
Person, (iii) not identified itself as a division of any other person or
commingled its funds with any other person, (iv) conducted its own business and
held its own assets in its own name, (v) observed all formalities required by
its certificate of formation and operating agreement, (vi) paid its own
employees and liabilities out of its own funds, (vii) allocated fairly and
reasonably overhead for any shared office space, (viii) maintained adequate
capital, to the extent necessary in light of its business operations, and (ix)
been treated as an entity disregarded as separate for income tax purposes.
SECTION 4.18 FOREIGN ASSETS CONTROL REGULATIONS, ETC.
(a) Neither the entry into this Agreement, the making of the Term Loan
nor its use of the proceeds thereof will violate the Trading with the Enemy Act,
as amended, or any of
30
the foreign assets control regulations of the United States Treasury Department
(31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or
executive order relating thereto.
(b) The Borrower (i) is not a Person described or designated in the
Specially Designated Nationals and Blocked Persons List of the Office of Foreign
Assets Control or in Section 1 of the Anti Terrorism Order and (ii) does not
engage in any dealings or transactions with any such Person. The Borrower is in
compliance, in all material respects, with the USA Patriot Act.
(c) No part of the proceeds from the Term Loan will be used, directly
or indirectly, for any payments to any governmental official or employee,
political party, official of a political party, candidate for political office,
or anyone else acting in an official capacity, in order to obtain, retain or
direct business or obtain any improper advantage, in violation of the United
States Foreign Corrupt Practices Act of 1977, as amended, assuming in all cases
that such Act applies to the Borrower.
SECTION 4.19 INVESTMENT COMPANY ACT.
The Borrower is not subject to regulation under the Investment Company Act
of 1940, as amended.
ARTICLE V. AFFIRMATIVE COVENANTS
The Borrower covenants and agrees that so long as the principal of and
interest on any Loan or any fee remains unpaid:
SECTION 5.01 FINANCIAL AND BUSINESS INFORMATION.
The Borrower shall deliver to the Agent:
(a) Semi-Annual Statements -- not later 30 days following the close of
each six-month period ending June 30 and December 31 of each year, duplicate
copies of,
(i) a balance sheet of the Borrower, as at the end of such period,
and
(ii) statements of cash flows of the Borrower, for such period,
in reasonable detail, prepared in accordance with GAAP, and accompanied by
a certificate of a Responsible Officer, which certificate shall state that such
financial statements present fairly, in all material respects, the financial
position of the Borrower and its cash flows and have been prepared in conformity
with GAAP;
(b) Notice of Default or Event of Default -- promptly, and in any
event within five days after a Responsible Officer becoming aware of the
existence of any Default or
31
Event of Default, a written notice specifying the nature and period of existence
thereof and what action the Borrower is taking or proposes to take with respect
thereto;
(c) [Reserved]
(d) Communications Regarding Collateral -- with reasonable promptness
following the Borrower's receipt thereof, any and all notices and other
communications received by the Borrower under or in connection with the
Installment Note or the Letter of Credit (including, without limitation, any
"Event of Default" under the Installment Note);
(e) Litigation -- promptly, and in any event within five days after
the filing or commencement thereof, a written notice of action, suit or
proceeding by or before any arbitrator or Governmental Authority against or
affecting the Borrower; and
(f) Requested Information -- with reasonable promptness, such other
data and information relating to the business, operations, affairs, financial
condition, assets or properties of the Borrower or relating to the ability of
the Borrower to perform its obligations under this Agreement and the other Loan
Documents as from time to time may be reasonably requested by the Agent.
SECTION 5.02 OFFICER'S CERTIFICATE.
Each set of financial statements delivered to the Agent pursuant to Section
5.01(a) shall be accompanied by a certificate of a Responsible Officer setting
forth a statement that a Responsible Officer reviewed the relevant terms hereof
and has made, or caused to be made, under his or her supervision, a review of
the transactions and conditions of the Borrower from the beginning of the
semi-annual period covered by the statements then being furnished to the date of
the certificate and that such review shall not have disclosed the existence
during such period of any condition or event that constitutes a Default or an
Event of Default or, if any such condition or event existed or exists,
specifying the nature and period of existence thereof and what action the
Borrower shall have taken or proposes to take with respect thereto.
SECTION 5.03 VISITATION.
The Borrower shall permit the Agent:
(a) No Default -- if no Default or Event of Default then exists, at
the expense of the Lenders and upon reasonable prior notice to the Borrower, to
discuss the affairs, finances and accounts of the Borrower with the Borrower's
officers at such reasonable times and as often as may be reasonably requested in
writing; and
(b) Default -- if a Default or Event of Default then exists, at the
expense of the Borrower to examine the Borrower's books of account, records,
reports and other papers, to make copies and extracts therefrom, and to discuss
the affairs, finances and accounts of the Borrower with its officers and
independent public accountants (and by this provision the
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Borrower authorizes said accountants to discuss the affairs, finances and
accounts of the Borrower), all at such times and as often as may be requested.
SECTION 5.04 COMPLIANCE WITH LAW.
The Borrower will comply with all laws, ordinances or governmental rules or
regulations to which it is subject, including, without limitation, ERISA and the
USA Patriot Act, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of its properties or to the conduct of its
businesses, except where the failure to do so, individually or in the aggregate,
could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.05 INSURANCE.
The Borrower will maintain, with financially sound and reputable insurers,
insurance with respect to its properties and businesses against such casualties
and contingencies, of such types, on such terms and in such amounts (including
deductibles, co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of entities engaged
in the same or a similar business and similarly situated, except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 5.06 MAINTENANCE OF PROPERTIES.
The Borrower will maintain and keep, or cause to be maintained and kept,
its properties in good repair, working order and condition (other than ordinary
wear and tear), so that the business carried on in connection therewith may be
properly conducted at all times.
SECTION 5.07 PAYMENT OF TAXES.
The Borrower will file all income tax or similar tax returns required to be
filed in any jurisdiction and pay and discharge all taxes shown to be due and
payable on such returns and all other taxes, assessments, governmental charges,
or levies payable by it, to the extent the same have become due and payable and
before they have become delinquent, provided that the Borrower need not pay any
such tax, assessment, charge or levy if the amount, applicability or validity
thereof is contested by the Borrower on a timely basis in good faith and in
appropriate proceedings, and the Borrower has established adequate reserves
therefor in accordance with GAAP on the books of the Borrower.
SECTION 5.08 CORPORATE EXISTENCE, ETC.
The Borrower will at all times preserve and keep in full force and effect
its existence. The Borrower will at all times preserve and keep in full force
and effect all rights and franchises of the Borrower material to the conduct of
its business.
SECTION 5.09 PAYMENT OF OBLIGATIONS.
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The Borrower will pay and discharge all of its obligations and liabilities
before the same shall become delinquent or in default; provided that the
Borrower need not pay any obligations or liabilities if the amount or validity
thereof is contested by the Borrower on a timely basis in good faith and in
appropriate proceedings, and the Borrower has established adequate reserves
therefor in accordance with GAAP on the books of the Borrower.
SECTION 5.10 BOOKS AND RECORDS.
The Borrower will maintain proper books of record and account in conformity
with GAAP and all applicable requirements of any Governmental Authority having
legal or regulatory jurisdiction over the Borrower, except where the failure to
do so, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect.
SECTION 5.11 ACTIVITIES.
The Borrower shall comply in all respects with Section 6.1 of its Amended
and Restated Limited Liability Company Agreement dated as of the Closing Date.
SECTION 5.12 CHARACTERIZATION OF BORROWER FOR TAX PURPOSES.
The Borrower will execute and caused to be filed such returns and make and
cause to be made such elections as may from time to time be required or
appropriate so as to maintain the Borrower's characterization, and will at all
times be characterized and treated, as an entity disregarded as separate for
income tax purposes.
ARTICLE VI. NEGATIVE COVENANTS
The Borrower covenants and agrees that so long as the principal of or
interest on any Loan remains unpaid or any fee remains unpaid:
SECTION 6.01 INDEBTEDNESS.
The Borrower will not incur, assume or suffer to exist any Indebtedness
other than the Term Loan.
SECTION 6.02 LIENS.
The Borrower will not create, incur, assume or suffer to exist any Lien
other than those Liens expressly permitted by the Loan Documents.
SECTION 6.03 TRANSACTIONS WITH AFFILIATES.
The Borrower will not enter into, directly or indirectly, any transaction
(including without limitation the purchase, lease, sale or exchange of
properties of any kind or the rendering of any
34
service) with any Affiliate, except (i) the Capitalization Transaction and (ii)
the making of distributions to the Parent to the extent permitted under Section
6.08.
SECTION 6.04 MERGER, CONSOLIDATION, ETC.
The Borrower will not consolidate with or merge with any other Person or
convey, transfer or lease any of its assets to any Person, except that the
Borrower may convey cash, the Installment Note and the Letter of Credit to the
Parent as a distribution to its sole member to the extent permitted under
Section 6.08.
SECTION 6.05 LINE OF BUSINESS.
The Borrower will not engage in any business other than (i) acquiring,
owning, managing, protecting, conserving and selling or otherwise dispose of the
Installment Note, the Letter of Credit, the Glatfelter Securities and Permitted
Investments, (ii) enter into and perform its obligations under the Loan
Documents to which the Borrower is a party, and (iii) engage in activities
related or incidental to the foregoing and necessary or appropriate therefor.
SECTION 6.06 TERRORISM SANCTIONS REGULATIONS.
The Borrower will not (a) become a Person described or designated in the
Specially Designated Nationals and Blocked Persons List of the Office of Foreign
Assets Control or in Section 1 of the Anti Terrorism Order or (b) engage in any
dealings or transactions with any such Person.
SECTION 6.07 INVESTMENTS.
The Borrower will not acquire any business or property, any equity interest
of any other Person, or any Indebtedness of any other Person, or otherwise make
or permit to remain outstanding any investment, other than the Borrower's
investment in the Installment Note, the Letter of Credit, the Glatfelter
Securities, any cash on deposit in the Interest Reserve Account or the
Collection Account, and Permitted Investments if such Permitted Investments
stand to the credit of the Interest Reserve Account or the Collection Account or
otherwise are subject to a perfected, first priority Lien in favor of the
Collateral Trustee.
SECTION 6.08 DISTRIBUTIONS.
The Borrower will not declare or make, or agree to pay or make, directly or
indirectly, any dividend payment or other distribution in respect of its
membership interests, except that (a) the Borrower may make the Closing Date
Distribution, (b) provided that, both before and after giving effect to such
distribution, no Default or Event of Default shall have occurred and be
continuing, the Borrower may make distributions to the Parent on each Interest
Payment Date to the extent provided in Section 6 of the Collateral Trust
Indenture in an amount equal to the amount of cash on hand of the Borrower in
excess of the sum of (x) the Interest Reserve Amount and (y) the amount of
expenses projected by the Borrower in good faith to be due and payable on or
prior to the immediately succeeding Interest Payment Date as certified by a
Responsible
35
Officer of the Borrower to the Collateral Trustee, and (c) upon any release by
the Collateral Trustee of its Lien on the Installment Note and Letter of Credit
in accordance with Section 8(f) of the Collateral Trust Indenture, the Borrower
may distribute the Installment Note and the Letter of Credit to the Parent. The
Borrower will not redeem or repurchase any of its membership interests.
SECTION 6.09 CAPITAL EXPENDITURES.
The Borrower will not make any capital expenditures.
SECTION 6.10 BANKRUPTCY, INSOLVENCY.
The Borrower will not (i) voluntarily commence any proceeding or file any
petition seeking liquidation, reorganization or other similar relief under any
Federal, state or foreign bankruptcy, insolvency, receivership or similar law
now or hereafter in effect, (ii) consent to the institution of, or fail to
contest in a timely and appropriate manner, any proceeding or petition seeking
liquidation, reorganization or similar relief in respect of the Borrower or its
debts or of a substantial part of its assets, under any Federal, state or
foreign bankruptcy, insolvency, receivership or similar law now or hereafter in
effect, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian or similar official for the Borrower or a substantial part of its
assets under any Federal, state or foreign bankruptcy, insolvency, receivership
or similar law now or hereafter in effect, (iv) file an answer admitting the
material allegations of a petition filed against it in any such proceeding, (v)
make a general assignment for the benefit of creditors or (vi) take any action
for the purpose of effecting any of the foregoing.
SECTION 6.11 AMENDMENTS AND MODIFICATIONS TO ORGANIZATIONAL DOCUMENTS
AND COLLATERAL.
(a) The Borrower will not without the prior written consent of the
Required Lenders (i) make any changes to its business objectives, purpose or
operations, (ii) make any change to its capital structure, including without
limitation the issuance of any membership interests or economic rights or units
or securities convertible into or exercisable for membership interests or
economic rights of the Borrower to any Person other than the Parent, (iii)
reorganize itself under the laws of any jurisdiction other than the jurisdiction
in which it is organized as of the date of the Closing, or (iv) amend or modify,
and will not authorize, consent to or permit the amendment or modification of,
its Amended and Restated Limited Liability Company Agreement dated as of the
Closing Date.
(b) The Borrower will not amend or modify, and will not authorize,
consent to or permit the amendment or modification of, the Installment Note, the
Letter of Credit, the Glatfelter Securities or the Contribution Agreement
without the prior written consent of the Required Lenders, provided that this
provision shall not limit the ability of the Borrower to request a substitution
of the Letter of Credit and take all steps and actions to implement such
substitution (including the replacement of the Letter of Credit by a substitute
Letter of Credit) in circumstances where the holder of the Installment Note is
permitted to request such a substitution pursuant to the terms of the
Installment Note.
36
ARTICLE VII. EVENTS OF DEFAULT
SECTION 7.01 EVENTS OF DEFAULT.
The following events are each an "Event of Default":
(a) the Borrower defaults in the payment of any principal or amount
required pursuant to Section 2.13 in connection with a prepayment of principal,
if any, on the Term Loan when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or
(b) the Borrower defaults in the payment of any interest on the Term
Loan or any other amount payable under this Agreement or any other Loan Document
for more than three Business Days after the same becomes due and payable; or
(c) the Borrower defaults in the performance of or compliance with any
term contained in Section 5.01(b), Section 5.08, Section 5.12 or Article VI; or
(d) the Borrower defaults in the performance of or compliance with any
term contained herein or any other Loan Document (other than those referred to
in Sections 7.01(a), (b) and (c)) and such default is not remedied within 30
days after the earlier of (i) a Responsible Officer obtaining actual knowledge
of such default and (ii) the Borrower receiving written notice of such default
from the Agent (any such written notice to be identified as a "notice of
default" and to refer specifically to this Section 7.01(d)); or
(e) any representation or warranty made in writing by or on behalf of
the Borrower or by a Responsible Officer or any other representative of the
Borrower in this Agreement or any other Loan Document or in any writing
furnished in connection with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date as of which made; or
(f) the Borrower (i) is generally not paying, or admits in writing its
inability to pay, its debts as they become due, (ii) files, or consents by
answer or otherwise to the filing against it of, a petition for relief or
reorganization or arrangement or any other petition in bankruptcy, for
liquidation or to take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction, (iii) makes an assignment
for the benefit of its creditors, (iv) consents to the appointment of a
custodian, receiver, trustee or other officer with similar powers with respect
to it or with respect to any substantial part of its property, (v) is
adjudicated as insolvent or to be liquidated, or (vi) takes any organizational
action for the purpose of any of the foregoing; or
(g) a court or Governmental Authority of competent jurisdiction enters
an order appointing, without consent by the Borrower, a custodian, receiver,
trustee or other officer with similar powers with respect to it or with respect
to any substantial part of its property, or
37
constituting an order for relief or approving a petition for relief or
reorganization or any other petition in bankruptcy or for liquidation or to take
advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering
the dissolution, winding-up or liquidation of the Borrower, or any such petition
shall be filed against the Borrower and such petition shall not be dismissed
within 60 days; or
(h) the Borrower is dissolved or liquidated or takes any
organizational action for the purpose of dissolving or liquidating; or
(i) a final judgment or judgments for the payment of money are
rendered against the Borrower and which judgments are not, within 30 days after
entry thereof, bonded, discharged or stayed pending appeal, or are not
discharged within 30 days after the expiration of such stay; or
(j) the L/C Bank is replaced with a substitute L/C Bank that is not a
commercial bank organized under the laws of the United States or any state
thereof or a branch located in the United States of any commercial bank
organized under the laws of any other country that is a member of the
Organization for Economic Cooperation and Development, in each case having a
long-term debt rating assigned by S&P of at least A+ and ▇▇▇▇▇'▇ of at least A1;
or
(k) the LC Bank ceases to be rated at least "A+" by S&P and "A1" by
▇▇▇▇▇'▇, and the LC Bank is not replaced within 60 days thereof with a
substitute LC Bank that (i) is a commercial bank organized under the laws of the
United States or any state thereof or a branch located in the United States of
any commercial bank organized under the laws of any other country that is a
member of the Organization for Economic Cooperation and Development, and (ii)
has a long-term debt rating assigned by S&P of at least "A+" and by ▇▇▇▇▇'▇ of
at least "A1"; or
(l) an Installment Note Trigger Event shall have occurred; or
(m) an "Event of Default" (as such term is defined in the Glatfelter
Securities) shall have occurred and be continuing; or
(n) Glatfelter shall cease to own, directly or indirectly, one hundred
percent (100%) of the issued and outstanding membership interests of the
Borrower; or
(o) a Contribution Agreement Event shall have occurred;
SECTION 7.02 REMEDIES ON DEFAULT, ETC.
(a) Acceleration.
(i) If an Event of Default with respect to the Borrower described in
Section 7.01(f), (g) or (h) (other than an Event of Default described in clause
(i) of Section 7.01(f) or described in clause (vi) of Section 7.01(f) by virtue
of the fact that such clause encompasses clause (i) of Section 7.01(f)) has
occurred, the principal of the Term Loan then outstanding,
38
together with accrued interest thereon, and all other Obligations shall
automatically become due and payable.
(ii) If any other Event of Default has occurred and is continuing, the
Agent may, and upon the written request of the Required Lenders shall, by notice
to the Borrower, take any or all of the following actions, at the same or
different times: (i) declare the principal of and any accrued interest on the
Term Loan and all other Obligations owing hereunder to be, whereupon the same
shall become, due and payable immediately; (ii) exercise all remedies contained
in any other Loan Document; and (iii) exercise any other remedies available at
law or in equity.
Upon the Term Loan becoming due and payable under this Section 7.02, whether
automatically or by declaration, all Obligations will forthwith mature and the
entire unpaid principal amount of the Term Loan, plus (x) all accrued and unpaid
interest thereon (including, but not limited to, interest accrued thereon at the
Default Rate) and (y) all amounts required pursuant to Section 2.13 determined
in respect of such principal amount (to the full extent permitted by applicable
law), shall all be immediately due and payable, in each and every case without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Borrower.
(b) Enforcement of Collateral. Upon the Term Loan becoming due and
payable, whether automatically or by declaration, the Required Lenders may
direct the Collateral Trustee to take any and all action with respect to the
Collateral permitted under the Loan Documents, at law, in equity or otherwise,
including, without limitation, to foreclose upon any or all of the Collateral
and to draw under the Letter of Credit to the extent permitted to do so under
the terms thereof.
(c) Rescission. At any time after the Term Loan has been declared due
and payable pursuant to Section 7.02(a)(ii), the Required Lenders, by written
notice to the Borrower, may rescind and annul any such declaration and its
consequences.
ARTICLE VIII. THE AGENT
SECTION 8.01 APPOINTMENT OF AGENT.
Each Lender irrevocably appoints SunTrust Bank as the Agent and authorizes it to
take such actions on its behalf and to exercise such powers as are delegated to
the Agent under this Agreement and the other Loan Documents, together with all
such actions and powers that are reasonably incidental thereto. The Agent may
perform any of its duties hereunder or under the other Loan Documents by or
through any one or more sub-agents or attorneys-in-fact appointed by the Agent.
The Agent and any such sub-agent or attorney-in-fact may perform any and all of
its duties and exercise its rights and powers through their respective Related
Parties. The exculpatory provisions set forth in this Article shall apply to any
such sub-agent or attorney-in-fact and the Related Parties of the Agent, any
such sub-agent and any such attorney-in-fact and
39
shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as Agent.
SECTION 8.02 NATURE OF DUTIES OF AGENT.
The Agent shall not have any duties or obligations except those expressly set
forth in this Agreement and the other Loan Documents. Without limiting the
generality of the foregoing, (a) the Agent shall not be subject to any fiduciary
or other implied duties, regardless of whether a Default or an Event of Default
has occurred and is continuing, (b) the Agent shall not have any duty to take
any discretionary action or exercise any discretionary powers, except those
discretionary rights and powers expressly contemplated by the Loan Documents
that the Agent is required to exercise in writing by the Required Lenders (or
such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided herein), and (c) except as expressly set forth in the
Loan Documents, the Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower
that is communicated to or obtained by the Agent or any of its Affiliates in any
capacity. The Agent shall not be liable for any action taken or not taken by it,
its sub-agents or attorneys-in-fact with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided herein) in the absence of its own
gross negligence or willful misconduct. The Agent shall not be responsible for
the negligence or misconduct of any sub-agents or attorneys-in-fact selected by
it with reasonable care. The Agent shall not be deemed to have knowledge of any
Default or Event of Default unless and until written notice thereof is given to
the Agent by the Borrower or any Lender, and the Agent shall not be responsible
for or have any duty to ascertain or inquire into (i) any statement, warranty or
representation made in or in connection with any Loan Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance or
observance of any of the covenants, agreements, or other terms and conditions
set forth in any Loan Document, (iv) the validity, enforceability, effectiveness
or genuineness of any Loan Document or any other agreement, instrument or
document, or (v) the satisfaction of any condition set forth in Article III or
elsewhere in any Loan Document, other than to confirm receipt of items expressly
required to be delivered to the Agent. The Agent may consult with legal counsel
(including counsel for the Borrower) concerning all matters pertaining to such
duties.
SECTION 8.03 LACK OF RELIANCE ON THE AGENT.
Each of the Lenders acknowledges that it has, independently and without reliance
upon the Agent or any other Lender and based on such documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement. Each of the Lenders also acknowledges that it will,
independently and without reliance upon the Agent or any other Lender and based
on such documents and information as it has deemed appropriate, continue to make
its own decisions in taking or not taking of any action under or based on this
Agreement, any related agreement or any document furnished hereunder or
thereunder.
SECTION 8.04 CERTAIN RIGHTS OF THE AGENT.
40
If the Agent shall request instructions from the Required Lenders with respect
to any action or actions (including the failure to act) in connection with this
Agreement, the Agent shall be entitled to refrain from such act or taking such
act, unless and until it shall have received instructions from such Lenders; and
the Agent shall not incur liability to any Person by reason of so refraining.
Without limiting the foregoing, no Lender shall have any right of action
whatsoever against the Agent as a result of the Agent acting or refraining from
acting hereunder in accordance with the instructions of the Required Lenders
where required by the terms of this Agreement.
SECTION 8.05 RELIANCE BY AGENT.
The Agent shall be entitled to rely upon, and shall not incur any liability for
relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed,
sent or made by the proper Person. The Agent may also rely upon any statement
made to it orally or by telephone and believed by it to be made by the proper
Person and shall not incur any liability for relying thereon. The Agent may
consult with legal counsel (including counsel for the Borrower), independent
public accountants and other experts selected by it and shall not be liable for
any action taken or not taken by it in accordance with the advice of such
counsel, accountants or experts.
SECTION 8.06 THE AGENT IN ITS INDIVIDUAL CAPACITY.
The bank serving as the Agent shall have the same rights and powers under this
Agreement and any other Loan Document in its capacity as a Lender as any other
Lender and may exercise or refrain from exercising the same as though it were
not the Agent; and the terms "Lenders", "Required Lenders", "holders of Notes",
or any similar terms shall, unless the context clearly otherwise indicates,
include the Agent in its individual capacity. The bank acting as the Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of business with the Borrower or Affiliate of the Borrower as if it
were not the Agent hereunder.
SECTION 8.07 SUCCESSOR AGENT.
(a) The Agent may resign at any time by giving at least 30 days' prior
notice thereof to the Lenders and the Borrower. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent, subject to
the approval by the Borrower (such approval not to be unreasonably withheld or
delayed) provided that no Default or Event of Default shall exist at such time.
If no successor Agent shall have been so appointed, and shall have accepted such
appointment within 30 days after the retiring Agent gives notice of resignation,
then the retiring Agent may, on behalf of the Lenders, appoint a successor
Agent, which shall be a commercial bank, insurance company or other financial
institution organized under the laws of the United States of America or any
state thereof or a bank, insurance company or other financial institution which
maintains an office in the United States, having a combined capital and surplus
of at least $500,000,000.
(b) Upon the acceptance of its appointment as the Agent hereunder by a
successor, such successor Agent shall thereupon succeed to and become vested
with all the
41
rights, powers, privileges and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations under this Agreement
and the other Loan Documents. If within 45 days after written notice is given of
the retiring Agent's resignation under this Section 8.07 no successor Agent
shall have been appointed and shall have accepted such appointment, then on such
45th day (i) the retiring Agent's resignation shall become effective, (ii) the
retiring Agent shall thereupon be discharged from its duties and obligations
under the Loan Documents and (iii) the Required Lenders shall thereafter perform
all duties of the retiring Agent under the Loan Documents until such time as the
Required Lenders appoint a successor Agent as provided above. After any retiring
Agent's resignation hereunder, the provisions of this Article VIII shall
continue in effect for the benefit of such retiring Agent and its
representatives and agents in respect of any actions taken or not taken by any
of them while it was serving as the Agent.
SECTION 8.08 AUTHORIZATION TO EXECUTE OTHER LOAN DOCUMENTS.
Each Lender hereby authorizes the Agent to execute on behalf of all Lenders all
Loan Documents other than this Agreement.
ARTICLE IX. MISCELLANEOUS
SECTION 9.01 NOTICES.
(a) Except in the case of notices and other communications expressly
permitted to be given by telephone, all notices and other communications to any
party herein to be effective shall be in writing and shall be delivered by hand
or overnight courier service, mailed by certified or registered mail or sent by
telecopy, as follows:
To the Borrower: GPW Virginia Timberlands LLC
c/o P.H. ▇▇▇▇▇▇▇▇▇▇ Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, VP & General Manager
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
To the Agent: SunTrust Bank
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇. ▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telecopy Number: 804.782.5413
To any other Lender: the address set forth in the Administrative
Questionnaire
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Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All such notices
and other communications shall, when transmitted by overnight delivery, or
faxed, be effective when delivered for overnight (next-day) delivery, or
transmitted in legible form by facsimile machine, respectively, or if mailed,
upon the third Business Day after the date deposited into the mail or if
delivered, upon delivery.
(b) Any agreement of the Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Borrower. The Agent and the Lenders shall be entitled to rely
on the authority of any Person purporting to be a Person authorized by the
Borrower to give such notice and the Agent and Lenders shall not have any
liability to the Borrower or other Person on account of any action taken or not
taken by the Agent or the Lenders in reliance upon such telephonic or facsimile
notice. The obligation of the Borrower to repay the Term Loan and all other
Obligations hereunder shall not be affected in any way or to any extent by any
failure of the Agent or the Lenders to receive written confirmation of any
telephonic or facsimile notice or the receipt by the Agent and the Lenders of a
confirmation which is at variance with the terms understood by the Agent and the
Lenders to be contained in any such telephonic or facsimile notice.
SECTION 9.02 WAIVER; AMENDMENTS.
(a) No failure or delay by the Agent or any Lender in exercising any
right or power hereunder or any other Loan Document, and no course of dealing
between the Borrower and the Agent or any Lender, shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power or
any abandonment or discontinuance of steps to enforce such right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power hereunder or thereunder. The rights and remedies of the Agent and
the Lenders hereunder and under the other Loan Documents are cumulative and are
not exclusive of any rights or remedies provided by law. No waiver of any
provision of this Agreement or any other Loan Document or consent to any
departure by the Borrower therefrom shall in any event be effective unless the
same shall be permitted by paragraph (b) of this Section 9.02, and then such
waiver or consent shall be effective only in the specific instance and for the
purpose for which given. Without limiting the generality of the foregoing, the
making of a Loan shall not be construed as a waiver of any Default or Event of
Default, regardless of whether the Agent or any Lender may have had notice or
knowledge of such Default or Event of Default at the time.
(b) No amendment or waiver of any provision of this Agreement or the
other Loan Documents, nor consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Borrower and the Required Lenders or the Borrower and the Agent with the
consent of the Required Lenders and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, that no amendment or waiver shall: (i) increase the Commitment
of any Lender without the written consent of such Lender, (ii) reduce the
principal amount of any Loan or reduce the rate of interest thereon, or reduce
any fees payable hereunder, without the written
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consent of each Lender affected thereby, (iii) postpone the date fixed for any
payment of any principal of, or interest on, any Loan or interest thereon or any
fees hereunder or reduce the amount of, waive or excuse any such payment, or
postpone the scheduled date for the termination or reduction of any Commitment,
without the written consent of each Lender affected thereby, (iv) change Section
2.15(b) or (c) in a manner that would alter the pro rata sharing of payments
required thereby, without the written consent of each Lender, (v) change any of
the provisions of this Section 9.02 or the definition of "Required Lenders" or
any other provision hereof specifying the number or percentage of Lenders which
are required to waive, amend or modify any rights hereunder or make any
determination or grant any consent hereunder, without the consent of each
Lender; (vi) release any guarantor or limit the liability of any such guarantor
under any guaranty agreement, without the written consent of each Lender; (vii)
release all or substantially all collateral (if any) securing any of the
Obligations or agree to subordinate any Lien in such collateral to any other
creditor, without the written consent of each Lender; provided further, that no
such agreement shall amend, modify or otherwise affect the rights, duties or
obligations of the Agent or the Collateral Trustee without the prior written
consent of the such Person. Notwithstanding anything contained herein to the
contrary, this Agreement may be amended and restated without the consent of any
Lender (but with the consent of the Borrower and the Agent) if, upon giving
effect to such amendment and restatement, such Lender shall no longer be a party
to this Agreement (as so amended and restated), the Commitments of such Lender
shall have terminated (but such Lender shall continue to be entitled to the
benefits of Sections 2.12, 2.13, 2.14 and 9.03), such Lender shall have no other
commitment or other obligation hereunder and shall have been paid in full all
principal, interest and other amounts owing to it or accrued for its account
under this Agreement.
SECTION 9.03 EXPENSES; INDEMNIFICATION.
(a) The Borrower shall pay (i) all reasonable, out-of-pocket costs and
expenses of the Agent and its Affiliates, including, without limitation, the
reasonable fees, charges and disbursements of outside counsel and allocated cost
of inside counsel for the Agent and its Affiliates, in connection with the
preparation and administration of the Loan Documents and any amendments,
modifications or waivers of the Loan Documents (whether or not the transactions
contemplated in this Agreement or any other Loan Document shall be consummated),
and (ii) all out-of-pocket costs and expenses (including, without limitation,
the reasonable fees, charges and disbursements of outside counsel and the
allocated cost of inside counsel) incurred by the Agent or any Lender in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section 9.03, or in connection
with the Term Loan, including all such out-of-pocket expenses incurred during
any workout, restructuring or negotiations in respect of the Term Loan.
(b) The Borrower shall indemnify the Agent (and any sub-agent thereof)
and each Lender and each Related Party of any of the foregoing Persons (each
such Person being called an "Indemnitee") against, and hold each Indemnitee
harmless from, any and all costs, losses, liabilities, claims, damages and
related expenses (including the fees, charges and disbursements of any counsel
for any Indemnitee), incurred by any Indemnitee or asserted against any
Indemnitee by any third party or by the Borrower or any Affiliate thereof
arising out of, in connection with, or as a result of (i) the execution or
delivery of this Agreement, any other Loan
44
Document or any agreement or instrument contemplated hereby or thereby, the
performance by the parties hereto of their respective obligations hereunder or
thereunder or the consummation of any of the transactions contemplated hereby or
thereby, (ii) any Loan or the use or proposed use of the proceeds therefrom or
(iii) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory, whether brought by a third party or by the Borrower or any Affiliate
thereof, and regardless of whether any Indemnitee is a party thereto, provided
that such indemnity shall not, as to any Indemnitee, be available to the extent
that such losses, claims, damages, liabilities or related expenses are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Indemnitee or any Related Party of such Indemnitee.
(c) The Borrower shall pay, and hold the Agent and each of the Lenders
harmless from and against, any and all present and future stamp, documentary,
and other similar taxes with respect to this Agreement and any other Loan
Documents, any collateral described therein, or any payments due thereunder, and
save the Agent and each Lender harmless from and against any and all liabilities
with respect to or resulting from any delay or omission to pay such taxes.
(d) To the extent that the Borrower fails to pay any amount required
to be paid to the Agent, each Lender severally agrees to pay to the Agent such
Lender's Pro Rata Share (determined as of the time that the unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided, that the
unreimbursed expense or indemnified payment, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the Agent in
its capacity as such.
(e) To the extent permitted by applicable law, the Borrower shall not
assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to actual or direct damages) arising out of, in connection with or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
transactions contemplated therein, any Loan or the use of proceeds thereof.
(f) All amounts due under this Section 9.03 shall be payable promptly
after written demand therefor.
SECTION 9.04 SUCCESSORS AND ASSIGNS.
(a) The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
the Agent and each Lender, and no Lender may assign or otherwise transfer any of
its rights or obligations hereunder except (i) to an assignee in accordance with
the provisions of paragraph (b) of this Section, (ii) by way of participation in
accordance with the provisions of paragraph (d) of this Section or (iii) by way
of pledge or assignment of a security interest subject to the restrictions of
paragraph (f) of this Section (and any other attempted assignment or transfer by
any party hereto shall be null and void). Nothing in this Agreement, expressed
or implied, shall be construed to confer upon any Person (other
45
than the parties hereto, their respective successors and assigns permitted
hereby, Participants to the extent provided in paragraph (d) of this Section
and, to the extent expressly contemplated hereby, the Related Parties of each of
the Agent and the Lenders) any legal or equitable right, remedy or claim under
or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more assignees all or
a portion of its rights and obligations under this Agreement (including all or a
portion of the Term Loan at the time owing to it); provided that any such
assignment shall be subject to the following conditions:
(i) Minimum Amounts.
(A) in the case of an assignment of the entire remaining amount
of the assigning Lender's portion of the Term Loan at the time owing to it or in
the case of an assignment to a Lender, an Affiliate of a Lender or an Approved
Fund, no minimum amount need be assigned; and
(B) in any case not described in paragraph (b)(i)(A) of this
Section, the outstanding principal balance of the Term Loan of the assigning
Lender subject to each such assignment (determined as of the date the Assignment
and Acceptance with respect to such assignment is delivered to the Agent or, if
"Trade Date" is specified in the Assignment and Acceptance, as of the Trade
Date) shall not be less than $1,000,000, unless each of the Agent and, so long
as no Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed).
(ii) Proportionate Amounts. Each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to the Term Loan assigned.
(iii) Required Consents. No consent shall be required for any
assignment except to the extent required by paragraph (b)(i)(B) of this Section
and, in addition:
(A) the consent of the Borrower (such consent not to be
unreasonably withheld or delayed) shall be required unless (x) an Event of
Default has occurred and is continuing at the time of such assignment or (y)
such assignment is to a Lender, an Affiliate of a Lender or an Approved Fund;
and
(B) the consent of the Agent (such consent not to be unreasonably
withheld or delayed) shall be required for assignments to a Person that is not a
Lender.
(iv) Assignment and Acceptance. The parties to each assignment shall
deliver to the Agent (A) a duly executed Assignment and Acceptance, which shall
include a representation for the benefit of the Borrower that the assignee is a
Qualified Purchaser, (B) a processing and recordation fee of $3,500, (C) an
Administrative Questionnaire unless the assignee is already a Lender, and (D)
the documents required under Section 2.15 if such assignee is a Foreign Lender.
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(v) No Assignment to Borrower. No such assignment shall be made to the
Borrower or any of the Borrower's Affiliates or Subsidiaries.
(vi) No Assignment to Natural Persons; Qualified Purchaser. No such
assignment shall be made to a natural person or to a Person that is not a
Qualified Purchaser.
Subject to acceptance and recording thereof by the Agent pursuant to
paragraph (c) of this Section 9.04, from and after the effective date specified
in each Assignment and Acceptance, the assignee thereunder shall be a party to
this Agreement and, to the extent of the interest assigned by such Assignment
and Acceptance, have the rights and obligations of a Lender under this
Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Sections 2.12, 2.13, 2.14 and 9.03 with
respect to facts and circumstances occurring prior to the effective date of such
assignment. Any assignment or transfer by a Lender of rights or obligations
under this Agreement that does not comply with this paragraph shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (d) of this Section
9.04. If the consent of the Borrower to an assignment is required hereunder
(including a consent to an assignment which does not meet the minimum assignment
thresholds specified above), the Borrower shall be deemed to have given its
consent five Business Days after the date notice thereof has actually been
delivered by the assigning Lender (through the Agent) to the Borrower, unless
such consent is expressly refused by the Borrower prior to such fifth Business
Day.
(c) The Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in Atlanta, Georgia a copy of
each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, the principal amount of
the Term Loan owing to, each Lender pursuant to the terms hereof from time to
time (the "Register"). Information contained in the Register with respect to any
Lender shall be available for inspection by such Lender at any reasonable time
and from time to time upon reasonable prior notice; information contained in the
Register shall also be available for inspection by the Borrower at any
reasonable time and from time to time upon reasonable prior notice. In
establishing and maintaining the Register, the Agent shall serve as the
Borrower's agent solely for tax purposes and solely with respect to the actions
described in this Section, and the Borrower hereby agrees that, to the extent
SunTrust Bank serves in such capacity, SunTrust Bank and its officers,
directors, employees, agents, sub-agents and affiliates shall constitute
"Indemnitees."
(d) Any Lender may at any time, without the consent of, or notice to,
the Borrower or the Agent sell participations to any Person (other than a
natural person, the Borrower or any of the Borrower's Affiliates or
Subsidiaries) (each, a "PARTICIPANT") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
the Term Loan owing to it); provided that (i) such Lender's obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other
47
parties hereto for the performance of such obligations and (iii) the Borrower,
the Agent and the Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement.
(e) Any agreement or instrument pursuant to which a Lender sells such
a participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver with respect to the following to the
extent affecting such Participant: (i) increase the Commitment of any Lender
without the written consent of such Lender, (ii) reduce the principal amount of
any Loan or reduce the rate of interest thereon, or reduce any fees payable
hereunder, without the written consent of each Lender affected thereby, (iii)
postpone the date fixed for any payment of any principal of, or interest on, any
Loan or any fees hereunder or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date for the termination or reduction of any
Commitment, without the written consent of each Lender affected thereby, (iv)
change Section 2.15(b) or (c) in a manner that would alter the pro rata sharing
of payments required thereby, without the written consent of each Lender, (v)
change any of the provisions of this Section 9.04 or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders which are required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder, without the consent of
each Lender; (vi) release any guarantor or limit the liability of any such
guarantor under any guaranty agreement without the written consent of each
Lender except to the extent such release is expressly provided under the terms
of such guaranty agreement; or (vii) release all or substantially all collateral
(if any) securing any of the Obligations. Subject to paragraph (f) of this
Section 9.04, the Borrower agrees that each Participant shall be entitled to the
benefits of (and shall have the related obligations under) Sections 2.12, 2.13,
and 2.14 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to paragraph (b) of this Section 9.04. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.07 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.15 as though it were a Lender.
(f) A Participant shall not be entitled to receive any greater payment
under Section 2.12 and Section 2.14 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 2.14 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
2.14(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
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SECTION 9.05 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF
PROCESS.
(a) This Agreement and the other Loan Documents shall be construed in
accordance with and be governed by the law (without giving effect to the
conflict of law principles thereof) of the State of New York.
(b) The Borrower hereby irrevocably and unconditionally submits, for
itself and its property, to the non-exclusive jurisdiction of any New York state
court or federal court sitting in the County of New York and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any other Loan Document or the transactions contemplated hereby or
thereby, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York state court or, to the extent permitted by applicable law, such Federal
court. Each of the parties hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement or any other Loan Document shall affect any right that
the Agent and the Lenders may otherwise have to bring any action or proceeding
relating to this Agreement or any other Loan Document against the Borrower or
its properties in the courts of any jurisdiction.
(c) The Borrower irrevocably and unconditionally waives any objection
which it may now or hereafter have to the laying of venue of any such suit,
action or proceeding described in paragraph (b) of this Section and brought in
any court referred to in paragraph (b) of this Section. Each of the parties
hereto irrevocably waives, to the fullest extent permitted by applicable law,
the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to the service
of process in the manner provided for notices in Section 9.01. Nothing in this
Agreement or in any other Loan Document will affect the right of any party
hereto to serve process in any other manner permitted by law.
SECTION 9.06 WAIVER OF JURY TRIAL.
EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT,
TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN
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DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.
SECTION 9.07 RIGHT OF SETOFF.
In addition to any rights now or hereafter granted under applicable law and
not by way of limitation of any such rights, the Agent and each Lender shall
have the right, at any time or from time to time upon the occurrence and during
the continuance of an Event of Default, without prior notice to the Borrower,
any such notice being expressly waived by the Borrower to the extent permitted
by applicable law, to set off and apply against all deposits (general or
special, time or demand, provisional or final) of the Borrower at any time held
or other obligations at any time owing by the Agent or any Lender to or for the
credit or the account of the Borrower against any and all Obligations held by
the Agent or any Lender, irrespective of whether the Agent or such Lender shall
have made demand hereunder and although such Obligations may be unmatured. The
Agent and Lenders agree promptly to notify the Borrower after any such set-off
and any application made by the Agent or any Lender; provided, that the failure
to give such notice shall not affect the validity of such set-off and
application.
SECTION 9.08 COUNTERPARTS; INTEGRATION.
This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts (including by telecopy), and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument. This Agreement, the Fee Letter and the other Loan Documents
constitute the entire agreement among the parties hereto and thereto regarding
the subject matters hereof and thereof and supersede all prior agreements and
understandings, oral or written, regarding such subject matters.
SECTION 9.09 SURVIVAL.
All covenants, agreements, representations and warranties made by the
Borrower herein and in the certificates or other instruments delivered in
connection with or pursuant to this Agreement shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of this Agreement and the making of the Term Loan, regardless of any
investigation made by any such other party or on its behalf and notwithstanding
that the Agent or the Lenders may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the principal
of or any accrued interest on any Loan or any fee or any other amount payable
under this Agreement is outstanding and unpaid. The provisions of Sections 2.11,
2.12, and 9.03 shall survive and remain in full force and effect regardless of
the consummation of the transactions contemplated hereby, the repayment of the
Term Loan, the expiration or termination of the Commitments or the termination
of this Agreement or any provision hereof. All representations and warranties
made herein, in the certificates, reports, notices, and other documents
delivered pursuant to this Agreement shall survive the execution and delivery of
this Agreement and the other Loan Documents, and the making of the Term Loan.
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SECTION 9.10 SEVERABILITY.
Any provision of this Agreement or any other Loan Document held to be
illegal, invalid or unenforceable in any jurisdiction, shall, as to such
jurisdiction, be ineffective to the extent of such illegality, invalidity or
unenforceability without affecting the legality, validity or enforceability of
the remaining provisions hereof or thereof; and the illegality, invalidity or
unenforceability of a particular provision in a particular jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
SECTION 9.11 CONFIDENTIALITY.
The Agent and the Lenders agree to take normal and reasonable precautions
to maintain the confidentiality of (i) any information designated in writing as
confidential and (ii) any and all information relating to the Installment Sale
Transaction and provided to it by the Borrower or any Subsidiary, except that
such information may be disclosed (i) to any Related Party of the Agent or the
Lenders, including without limitation accountants, legal counsel and other
advisors; provided that the Agent or the Lender disclosing such information
first advises the party receiving such information that it is confidential as
per the provisions of this Section and that the Agent or Lender shall be
responsible for compliance by the party receiving the information with the
provisions of this Section, (ii) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (iii) to the extent
requested by any regulatory agency or authority, (iv) to the extent that such
information becomes publicly available other than as a result of a breach of
this Section, or which becomes available to the Agent or a Lender or any Related
Party of the Agent or a Lender on a nonconfidential basis from a source other
than the Borrower, (v) in connection with the exercise of any remedy hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, and (ix) subject to provisions substantially similar to
this Section 9.11, to any actual or prospective assignee or Participant, or (vi)
with the consent of the Borrower. Any Person required to maintain the
confidentiality of any information as provided for in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
information as such Person would accord its own confidential information.
SECTION 9.12 INTEREST RATE LIMITATION.
Notwithstanding anything herein to the contrary, if at any time the
interest rate applicable to the Term Loan, together with all fees, charges and
other amounts which may be treated as interest on such Loan under applicable law
(collectively, the "CHARGES"), shall exceed the maximum lawful rate of interest
(the "MAXIMUM RATE") which may be contracted for, charged, taken, received or
reserved by the Agent and the Lenders in accordance with applicable law, the
rate of interest payable in respect of the Term Loan hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate
and, to the extent lawful, the interest and Charges that would have been payable
in respect of such Loan but were not payable as a result of the operation of
this Section shall be cumulated and the interest and Charges payable to the
Agent on behalf of the Lenders in respect of other periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the
51
Federal Funds Rate to the date of repayment, shall have been received by the
Agent on behalf of the Lenders.
SECTION 9.13 QUALIFIED PURCHASER.
Each Lender severally represents that it is a Qualified Purchaser.
(remainder of page left intentionally blank)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
GPW VIRGINIA TIMBERLANDS LLC
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and
General Manager
SUNTRUST BANK
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
[SIGNATURE PAGE TO TERM LOAN AGREEMENT]
SCHEDULE 4.05
Closing Date Balance Sheet
LLC
BALANCE SHEET
JAN-08
ASSETS
Cash and cash equivalents $ 400,000
Accounts receivable --
Inventories --
Other current assets 9,158,000
Deferred transaction costs 520,000
-----------
Current assets 10,078,000
-----------
Net plant, equipment and timberlands --
Total other non-current assets 43,170,000
-----------
Total assets $53,248,000
===========
LIABILITIES
Current liabilities --
-----------
Long-term debt 36,694,500
Other long term liabilities --
-----------
Total liabilities 36,694,500
-----------
SHAREHOLDER'S EQUITY
Common shares $ --
Capital in excess of par value 16,573,500
Retained earnings (20,000)
-----------
Total liabilities and equity $53,248,000
===========
Balance Sheet
SCHEDULE 4.15
1. The Credit Agreement, dated as of April 3, 2006, by and among P. H.
Glatfelter Company, certain of its subsidiaries identified therein, the
Guarantors (as defined therein), the Banks (as defined therein), PNC Bank,
National Association, as agent for the Banks, PNC Capital Markets LLC and
Credit Suisse Securities (USA) LLC, as joint arrangers and bookrunners, and
Credit Suisse Securities (USA) LLC, as syndication agent, as amended from
time to time.
2. The Indenture, dated as of April 28, 2006 among P. H. Glatfelter Company as
the Issuer of 7 1/8 % Senior Notes due 2016 and SunTrust Bank as Trustee,
and the Subsidiary Guarantors (as defined therein), as amended from time to
time.
Term Loan Agreement - Schedule 4.15
EXHIBIT A
TERM NOTE
(SUNTRUST)
THIS TERM NOTE IS SUBJECT TO THE RESTRICTIONS ON TRANSFER CONTAINED IN SECTION
9.04 OF THE TERM LOAN AGREEMENT INCLUDING, WITHOUT LIMITATION, THE REQUIREMENT
THAT ANY TRANSFEREE BE A "QUALIFIED PURCHASER" AS DEFINED IN SECTION 2(A)(51) OF
THE INVESTMENT COMPANY ACT OF 1940
$36,694,500 New York, NY
January 15, 2008
FOR VALUE RECEIVED, the undersigned, GPW VIRGINIA TIMBERLANDS LLC, a
Delaware limited liability company (the "BORROWER"), hereby promises to pay to
SUNTRUST BANK (the "LENDER") or its registered assigns at the office of Lender
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other
location as to which the Lender shall have given written notice to the Borrower
(i) on the Maturity Date (as defined in that certain Term Loan Agreement, dated
as of January 15, 2008 among the Borrower, the lenders from time to time party
thereto, and SunTrust Bank, as Agent, as the same may be amended, restated,
supplemented or otherwise modified from time to time, the "TERM LOAN AGREEMENT")
the aggregate unpaid principal amount of the portion of the Term Loan (as
defined in the Term Loan Agreement) made by the Lender to the Borrower pursuant
to the Term Loan Agreement, and (ii) on each date specified in the Term Loan
Agreement, interest on the portion of the principal amount of the Term Loan
payable to such Lender, at the rate or rates per annum as provided in the Term
Loan Agreement, in each case in lawful money of the United States of America in
immediately available funds. In addition, should legal action or an
attomey-at-law be utilized to collect any amount due hereunder, the Borrower
further promises to pay all costs of collection, including the reasonable
attorneys' fees of the Lender.
The Borrower promises to pay, on demand, Default Interest (as defined in
the Term Loan Agreement) on the terms and conditions set forth in the Term Loan
Agreement.
This Note is issued in connection with, and is entitled to the benefits of,
the Term Loan Agreement which, among other things, contains provisions for the
acceleration of the maturity hereof upon the happening of certain events, for
prepayment of the principal hereof prior to the maturity hereof and for the
amendment or waiver of certain provisions of the Term Loan Agreement, all upon
the terms and conditions therein specified. THIS NOTE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK AND ANY
APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
IN WITNESS WHEREOF, Borrower has caused this Note to be executed and
delivered as of the date first above written.
GPW VIRGINIA TIMBERLANDS LLC
By: (SEAL)
-----------------------------
Name:
----------------------------------
Title:
---------------------------------
EXHIBIT B
THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR UNDER ANY SECURITIES LAW OF ANY STATE OF THE UNITED STATES OF
AMERICA AND, ACCORDINGLY, MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE
TRANSFERRED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933 AND ANY
APPLICABLE STATE LAW, UNLESS PURSUANT TO AN EXEMPTION FROM REGISTRATION
THEREUNDER OR IN A TRANSACTION NOT SUBJECT TO REGISTRATION THEREUNDER.
PROMISSORY NOTE NO. [__]
$[__________] [__________]
FOR VALUE RECEIVED, the undersigned, P. H. GLATFELTER COMPANY, a
Pennsylvania corporation (the "Issuer"), hereby promises to pay [__________]
(the "Payee"), or its registered assigns (the Payee and each such assignee is
referred to herein as the "Holder"), the principal amount of [__________]
($[__________]) plus accrued interest from the date of this Promissory Note, in
lawful money of the United States of America, at the place for payment provided
for herein on the terms and conditions set forth below.
ARTICLE I
DEFINITIONS AND OTHER TERMS
1.1 Definitions. As used in this Promissory Note, the following terms shall
have the following meanings:
"Agreement" has the meaning specified in Section 2.1.
"Business Day" means a day on which commercial banks and foreign
exchange markets settle payments and are open for general business
(including dealings in foreign exchange and foreign currency deposits) in
New York City.
"Buyer" has the meaning specified in Section 2.1.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Event of Default" has the meaning specified in Section 3.1.
"Excluded Taxes" has the meaning specified in Section 2.4(d).
"Foreign Holder" means any Holder that is organized under the laws of
a jurisdiction other than that in which Issuer is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"GAAP" means United States generally accepted accounting principles
consistently applied.
"Governmental Authority", with respect to any Person, means any
nation, any state or other political subdivision thereof and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, including any government
authority, agency, department, board, commission or instrumentality of the
United States, any state of the United States or any political subdivision
thereof, and any tribunal or arbitrator(s) of competent jurisdiction, and
in each case, having jurisdiction or authority over such Person.
"Gross-Up Amount" has the meaning specified in Section 2.4(d).
"Institutional Investor" means any bank, trust company, savings and
loan association or other financial institution, any pension plan, any
investment company, any insurance company, any broker or dealer, or any
other similar financial institution or entity, regardless of legal form.
"Interest Period" means (i) initially, the period commencing on the
date hereof and ending on [__________] and (ii) thereafter, each period
commencing on the last day of the immediately preceding Interest Period and
ending on the [_____] day of the sixth consecutive month ending after the
month in which such immediately preceding Interest Period ended. The
determination of Interest Periods shall be subject to the following
provisions:
(i) if any Interest Period would otherwise expire on a day that
is not a Business Day, such Interest Period shall expire on the
immediately succeeding Business Day; provided, however, that if any
Interest Period would otherwise expire on a day that is not a Business
Day but is a day of the month after which no further Business Day
occurs in such month, such Interest Period shall expire on the
immediately preceding Business Day; and
(ii) no Interest Period shall extend beyond the stated maturity
date hereof.
"Lenders" shall have the meaning assigned to such term in the Term
Loan Agreement.
2
"Material Adverse Effect" means a material adverse effect on (i) the
business, operations, affairs, financial condition, assets or properties of
the Issuer, or (ii) the ability of the Issuer to perform its obligations
under the Notes and the Agreement, or (iii) the validity or enforceability
of the Notes or the Agreement.
"Notes" has the meaning specified in Section 2.1.
"Interest Rate" has the meaning specified in Section 2.2(a).
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Promissory Note" means this promissory note issued by Issuer.
"SEC" means the Securities and Exchange Commission or any governmental
agencies substituted therefor.
"Securities Act" means the Securities Exchange Act of 1934, as
amended.
"Similar Law" has the meaning specified in Section 5.2.
"Taxes" has the meaning specified in Section 2.4(d).
"Term Loan" shall mean the floating rate loan in the principal amount
of $36,694,500 made pursuant to the Term Loan Agreement.
"Term Loan Agreement" shall mean that certain Term Loan Agreement,
dated as of the date hereof, by and among GPW Virginia Timberlands LLC, the
Lenders from time to time party thereto, and SunTrust Bank, as agent.
1.2 Interpretation. In this Promissory Note, except to the extent that the
context otherwise requires:
(a) the Articles and Section headings are for convenience of
reference only and shall not affect the interpretation of this Promissory
Note;
(b) unless otherwise specified, references to Articles, Sections,
Schedules and clauses are references to Articles, Sections, Schedules and
clauses of this Promissory Note;
(c) references to any document or agreement, including this
Promissory Note, shall be deemed to include references to such document or
agreement as amended, supplemented, restated or replaced and in effect from
time
3
to time in accordance with its terms and subject to compliance with the
requirements, if any, set forth herein and therein;
(d) references to any party to this Promissory Note or any other
document or agreement or to any other Person shall include its permitted
successors and assigns;
(e) when used in this Promissory Note, the words "including",
"includes" and "include" shall be deemed to be followed in each instance by
the words "without limitation";
(f) when used in this Promissory Note, the words "herein",
"hereby", "hereunder", "hereof, "hereto", "hereinbefore", and
"hereinafter", and words of similar import, shall refer to this Promissory
Note in its entirety and not to any particular section, subsection,
paragraph, sub-paragraph, clause or other subdivision of this Promissory
Note; and
(g) when used herein, the singular shall include the plural, the
plural shall include the singular and the use of any gender shall include
all genders, unless the context requires otherwise.
ARTICLE II
PAYMENTS OF PRINCIPAL, PREMIUM AND INTEREST
2.1 Payment of Principal. Except as otherwise provided herein, Issuer
agrees to pay the principal amount of this Promissory Note in full on
[__________]. This Promissory Note is one of the promissory notes in the
aggregate principal amount of $[__________] (the "Notes") issued by Issuer
pursuant to the [Note Purchase Agreement] dated as of January 15, 2008 (the
"Agreement"), between the Issuer and [______] (the "Buyer"), pursuant to which
Issuer sold the Notes to the Buyer.
2.2 Payment of Interest.
(a) General. Interest shall accrue on the unpaid principal amount of
this Promissory Note from the date of this Promissory Note to maturity (whether
by acceleration, notice of prepayment or otherwise) at the rate per annum equal
to [_____]% per annum (the "Interest Rate") and shall be payable on the last day
of each Interest Period.
(b) Default Interest. Upon the occurrence and during the continuance
of any Event of Default, interest shall accrue and be payable by Issuer on the
unpaid principal amount hereof, together with any and all past due interest and
other past due amounts due hereunder, at the Interest Rate plus an additional
[_____]% per annum.
4
2.3 Optional Prepayments. For so long as any principal of, accrued interest
on, or any other amount due in respect of the Term Loan remains unpaid, Issuer
is not permitted to prepay the principal amount of this Promissory Note.
2.4 Terms of Payment.
(a) All payments under this Promissory Note shall be made without
defense, set-off or counterclaim to the Holder not later than 11:00 a.m. (New
York, New York time) on the date when due and shall be made in United States
dollars in the manner provided in clauses (b) and (c) below.
(b) Subject to clause (c) below, payments of principal, premium, if
any, and interest becoming due and payable on this Promissory Note shall be made
at the principal office of Issuer in York, Pennsylvania. Issuer may at any time,
by notice to the Holder, change the place of payment of the Notes so long as
such place of payment shall be either the principal office of Issuer in York,
Pennsylvania or the principal office of a bank or trust company in New York, New
York.
(c) So long as [_____] or its nominee shall be a Holder of this
Promissory Note, and notwithstanding anything contained in clause (b) above or
elsewhere herein to the contrary, Issuer will pay all sums due on this
Promissory Note for principal, premium, if any, and interest by the method and
at the address as the Holder shall from time to time specify to Issuer in
writing for such purpose, without the presentation or surrender of this
Promissory Note or the making of any notation hereon, except that upon written
request of Issuer made concurrently with or reasonably promptly after payment or
prepayment in full of this Promissory Note, the Holder shall surrender this
Promissory Note for cancellation, reasonably promptly after any such request, to
Issuer at its principal executive office or at the place of payment most
recently designated by Issuer pursuant to clause (b) above. Prior to any sale or
other disposition of this Promissory Note by the Holder or any nominee of the
Holder, the Holder will, at its election, either endorse hereon the amount of
principal paid hereon and the last date to which interest has been paid hereon
or surrender this Promissory Note to Issuer in exchange for a new Note.
(d) (i) Any and all payments by Issuer under this Promissory Note
shall be made free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding taxes imposed on or measured by the
net income of the Holder, franchise taxes, branch profits taxes imposed by the
United States of America, and, in the case of a Foreign Holder, the amount of
any withholding obligation that would not have arisen but for the inability or
failure of such Foreign Holder to comply with the provisions of clause (iv)
below unless such withholding is imposed as a result of a change in law, tax
treaty or regulation occurring subsequent to the date on which such Foreign
Holder originally acquired this Promissory Note (all such excluded net income
taxes,
5
franchise taxes, branch profits taxes, and withholding collectively referred to
as the "Excluded Taxes"; all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being collectively referred to
as "Taxes"). If Issuer shall be required by law to deduct any Taxes from or in
respect of any sum payable under this Promissory Note to the Holder, (A) the sum
so payable shall be increased by such amount (the "Gross-up Amount") as may be
necessary so that after making all required deductions (including deductions
with respect to Taxes owed by the Holder on the Gross-up Amount) the Holder
receives an amount equal to the sum it would have received had no such
deductions been made, (B) Issuer shall make such deductions, and (C) Issuer
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law.
(ii) Issuer will indemnify the Holder for the full amount of Taxes
(together with any Taxes or Excluded Taxes owed by the Holder applicable to the
Gross-up Amount payable under clause (i) above or on the indemnification
payments made by Issuer under this clause (ii), but without duplication
thereof), and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto, whether or not such Taxes or such Excluded
Taxes were correctly or legally asserted, so as to compensate the Holder for any
loss, cost, expense or liability incurred as a consequence of any such Taxes.
The Holder claiming indemnification shall make written demand therefor no later
than one year after the earlier of (A) the date on which the Holder makes
payment of such Taxes or Excluded Taxes and (B) the date on which the
appropriate Governmental Authority makes written demand on the Holder for
payment of such Taxes or Excluded Taxes. Payment pursuant to such
indemnification shall be made within 10 days from the date the Holder makes
written demand therefor. Within 30 days after the date of Issuer's payment of
Taxes, Issuer will furnish to the Holder the original or a certified copy of a
receipt evidencing payment thereof.
(iii) The obligations of Issuer contained in this Section shall
survive the payment in full of the principal of, premium, if any, and interest
hereunder.
(iv) Any Foreign Holder shall deliver to Issuer, at the time or times
prescribed by applicable law or reasonably requested by Issuer, such properly
completed and executed documentation prescribed by applicable law as will permit
such payments to be made without withholding. Should a Holder be subject to
withholding tax because of the Holder's failure to comply with the provisions of
this clause (iv), Issuer shall take such steps (at the Holder's expense) as the
Holder shall reasonably request in writing to assist the Holder to recover such
tax.
(e) All computations of interest and fees hereunder and under the
other Notes shall be made on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such interest or fees are payable (to the extent computed
on the basis of days elapsed).
6
(f) Each payment on this Promissory Note shall be accompanied by a
written statement of the Issuer setting forth in detail the portion of such
payment that constitutes interest, the portion of such payment that constitutes
a payment of principal, and the portion of such payment that represents any
other amount due hereunder.
2.5 Denominations. This Promissory Note may be in the denomination of
$[__________] or any amount in excess thereof. At the option of the Holder, this
Promissory Note may be exchanged for a Note or Notes in any other denomination
or denominations permitted hereby and of a like aggregate principal amount and
tenor, upon surrender of this Promissory Note to be exchanged at the principal
office of Issuer. Whenever this Promissory Note is so surrendered for exchange,
Issuer shall issue and execute the Note or Notes which the Holder is entitled to
receive.
ARTICLE III
EVENTS OF DEFAULT
3.1 Default. The occurrence of any of the following events shall constitute
an event of default ("Event of Default") under this Promissory Note (whatever
the reason for such event and whether or not it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree, order, rule or regulation of any Governmental Authority):
(a) Issuer shall fail to pay any principal of any Note, or Issuer
shall fail to pay any interest on any Note or any other amount owing
hereunder or under the Agreement within three Business Days after such
interest or other amount becomes due in accordance with the terms hereof or
thereof; or
(b) any representation or warranty made at any time by the Issuer
herein or in the Agreement, or in any certificate, other instrument or
statement furnished pursuant to the provisions hereof or thereof, shall
prove to have been false or misleading in any material respect as of the
time it was made or furnished; or
(c) Issuer shall default in the observance or performance of any
covenant, condition or provision hereof or of the Agreement (other than
those referred to in clauses (a) and (b) above) and such default shall
continue unremedied for a period of 30 days after the earlier of (i) a
responsible officer of Issuer obtaining actual knowledge of such default
and (ii) Issuer receiving written notice of such default from the holder of
this Promissory Note; or
(d) Issuer (i) is generally not paying, or admits in writing its
inability to pay, its debts as they become due, (ii) files, or consents by
answer or otherwise to the filing against it of, a petition for relief or
reorganization or
7
arrangement or any other petition in bankruptcy, for liquidation or to take
advantage of any bankruptcy, insolvency, reorganization, moratorium or
other similar law of any jurisdiction, (iii) makes an assignment for the
benefit of its creditors, (iv) consents to the appointment of a custodian,
receiver, trustee or other officer with similar powers with respect to it
or with respect to any substantial part of its property, (v) is adjudicated
as insolvent or to be liquidated, or (vi) takes any organizational action
for the purpose of any of the foregoing; or
(e) a court or Governmental Authority of competent jurisdiction
enters an order appointing, without consent by the Issuer, a custodian,
receiver, trustee or other officer with similar powers with respect to it
or with respect to any substantial part of its property, or constituting an
order for relief or approving a petition for relief or reorganization or
any other petition in bankruptcy or for liquidation or to take advantage of
any bankruptcy or insolvency law of any jurisdiction, or ordering the
dissolution, winding-up or liquidation of the Issuer, or any such petition
shall be filed against the Issuer and such petition shall not be dismissed
within 60 days; or
(f) Issuer is dissolved or liquidated or takes any organizational
action for the purpose of dissolving or liquidating; or
(g) (i) any person or group of persons (within the meaning of
Sections 13(d) or 14(a) of the Securities Exchange Act of 1934, as amended)
shall have acquired, after the date hereof, beneficial ownership of (within
the meaning of Rule 13d-3 promulgated by the SEC under said Act) 20.00% or
more of the voting capital stock of P. H. Glatfelter Company, or (ii)
within a period of twelve (12) consecutive calendar months, individuals who
were directors of the Issuer on the first day of such period (together with
any new directors whose election by the board of directors of the Issuer or
whose nomination for election by the shareholders of the Issuer was
approved by a vote of a majority of the directors then still in office who
were either directors as of the first day of such period or whose election
or nomination for election was previously so approved) shall cease to
constitute a majority of the board of directors of the Issuer.
3.2 Remedies.
(a) Upon the occurrence and during the continuation of an Event of
Default the Holder may, in its sole discretion, declare this Promissory Note,
including, without limitation, principal, premium, if any, accrued interest and
costs of collection (including, without limitation attorneys' fees and
disbursements if collected by or through an attorney at law or in bankruptcy,
receivership or other judicial proceedings), immediately due and payable,
without presentment, demand, protest or any other notice of any kind, all of
which are expressly waived.
8
(b) Upon the occurrence of an Event of Default described in Section
3.l(d), 3.1(e) or 3.1(f), this Promissory Note, including, without limitation,
principal, premium, if any, accrued interest and costs of collection (including,
without limitation, attorneys' fees if collected by or through an attorney at
law or in bankruptcy, receivership or other judicial proceedings), shall
automatically become immediately due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are expressly waived.
(c) Upon the occurrence of an Event of Default and acceleration of
this Promissory Note as provided in Section 3.2(a) or (b), the Holder may pursue
any remedy available under this Promissory Note or available at law or in
equity, all of which shall be cumulative. The order and manner in which the
rights and remedies of the Holder may be exercised shall be determined by the
Holder in its sole discretion.
(d) All payments with respect to this Promissory Note received by the
Holder after the occurrence of an Event of Default shall be applied first, to
the costs and expenses (including actual attorneys' fees and disbursements)
incurred by the Holder as a result of such Event of Default, second, to the
payment of premium, if any, and accrued and unpaid interest on this Promissory
Note, to and including the date of such application, third, to the payment of
the unpaid principal of this Promissory Note, and fourth, to the payment of all
other amounts then owing to the Holder under this Promissory Note. No
applications of the payments will cure any Event of Default or prevent
acceleration, or continued acceleration, of amounts payable under this
Promissory Note or prevent the exercise, or continued exercise, of rights or
remedies of the Holder hereunder or under applicable law.
ARTICLE IV
COVENANTS
4.1 Annual Financial Statements. if Issuer (or any permitted successor to
Issuer) ceases to be a company subject to the reporting requirements of Section
13(a) or 15(d) of the Securities Act, then as soon as available and in any event
within 90 days after the end of each fiscal year of the Issuer, the Issuer shall
furnish, or cause to be furnished to the Holder, financial statements of the
Issuer consisting of a consolidated balance sheet as of the end of such fiscal
year, and related consolidated statement of income, consolidated retained
earnings and cash flows for the fiscal year then ended, all in reasonable detail
and setting forth in comparative form the financial statements as of the end of
and for the preceding fiscal year, and certified by independent certified public
accountants of nationally recognized standing. The certificate or report of
accountants shall be free of qualifications (other than any consistency
qualification that may result from a change in the method used to prepare the
financial statements as to which such accountants concur) and shall not indicate
the occurrence or existence of any event, condition or contingency which would
materially impair the prospect of payment or
9
performance of any covenant, agreement or duty of Issuer under this Promissory
Note or the Note Purchase Agreement.
4.2 Existence. The Issuer shall maintain its legal existence as a
corporation and its license or qualification and good standing in each
jurisdiction in which its ownership or lease of property or the nature of its
business makes such license or qualification necessary, except to the extent the
failure to do so would not reasonably be expected to result in a Material
Adverse Effect.
4.3 Books and Records. The Issuer shall maintain and keep proper books of
record and account which enable the Issuer to issue financial statements in
accordance with GAAP and as otherwise required by applicable laws of any
Governmental Authority having jurisdiction over the Issuer, and in which full,
true and correct entries shall be made in all material respects of all its
dealings and business and financial affairs.
ARTICLE V
MISCELLANEOUS
5.1 Usury. It is the intent of Issuer and the Holder not to violate any
federal or state law, rule or regulation pertaining either to usury or to the
contracting for or charging or collecting of interest, and Issuer and the Holder
agree that, should any provision of this Promissory Note or any act performed
hereunder violate any such law, rule or regulation, then the excess of interest
contracted for or charged or collected over the maximum lawful rate of interest
shall be applied to the outstanding principal indebtedness due to the Holder by
Issuer under this Promissory Note.
5.2 Assignment. Subject to the following sentence, the Holder may assign,
sell, transfer or pledge this Promissory Note without the consent of Issuer, and
any reference herein to the Holder shall be treated as a reference to any such
assignee, purchaser, transferee or pledgee. Issuer may not assign or otherwise
transfer its obligations with respect to this Promissory Note without the prior
written consent of the Holder.
5.3 Absolute Obligation. The obligation of Issuer to pay the principal
balance hereof to the Holder shall be absolute and unconditional, and Issuer
shall make such payment without abatement, diminution or deduction regardless of
any cause or circumstances whatsoever, including, without limitation, any
defense, setoff, recoupment or counterclaim which Issuer may have or assert
against the Holder or any other Person.
5.4 Waiver. ISSUER WAIVES PRESENTMENT AND DEMAND FOR PAYMENT, NOTICE OF
DISHONOR, PROTEST AND NOTICE OF PROTEST OF THIS PROMISSORY NOTE, AND ALL OTHER
NOTICES IN CONNECTION WITH
10
THE DELIVERY, ACCEPTANCE, PERFORMANCE, DEFAULT OR ENFORCEMENT OF THIS PROMISSORY
NOTE.
5.5 Amendments.
(a) This Promissory Note may be amended, and the observance of any
term hereof may be waived (either retroactively or prospectively), with (and
only with) the written consent of Issuer and the Holder.
(b) Issuer will provide the Holder (irrespective of the amount of
Notes then owned by it) with sufficient information, sufficiently far in advance
of the date a decision is required, to enable the Holder to make an informed and
considered decision with respect to any proposed amendment, waiver or consent in
respect of any of the provisions of the Notes. Issuer will deliver executed or
true and correct copies of each amendment, waiver or consent effected pursuant
to the provisions of this Section 5.5 to the Holder promptly following the date
on which it is executed and delivered by, or receives the consent or approval
of, the applicable Holders of Notes.
(c) Issuer will not directly or indirectly pay or cause to be paid any
remuneration, whether by way of supplemental or additional interest, fee or
otherwise, or grant any security, to any Holder of Notes as consideration for or
as an inducement to the entering into by any such Holder of any waiver or
amendment of any of the terms and provisions of any Note unless such
remuneration is concurrently paid, or security is concurrently granted, on the
same terms, ratably to each Holder of Notes then outstanding even if such Holder
did not consent to such waiver or amendment.
(d) No amendment or waiver of the terms of this Promissory Note will
extend to or affect any obligation, covenant, agreement or Event of Default not
expressly amended or waived or impair any right consequent thereon. No course of
dealing between Issuer and the Holder of any Note nor any delay in exercising
any rights under any Note shall operate as a waiver of any rights of the Holder.
5.6 Reimbursement. Issuer hereby agrees to pay or reimburse the Holder for
all costs, expenses or losses incurred by the Holder in connection with the
collection or enforcement of the provisions hereof or of its rights in
connection with this Promissory Note (whether or not any formal action or
proceeding is commenced), including, but not limited to, the entire amount of
legal or collection fees and disbursements incurred by the Holder.
5.7 Construction. Should any part or provision of this Promissory Note
require judicial interpretation, Issuer and the Holder agree that the court
interpreting such part or provision shall not apply a presumption that the terms
hereof shall be more strictly construed against one party by reason of the rule
of construction that a document is to be more strictly construed against the
party that itself or through its agent prepared the same,
11
it being agreed that Issuer and the Holder have both participated in the
preparation of this Promissory Note.
5.8 Severability. Any provision of this Promissory Note that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or enforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provisions in any other jurisdiction.
5.9 No Release. The rights, powers and remedies provided to the Holder
herein are cumulative and not exclusive of any right, power or remedy provided
at law or in equity. Failure or forbearance of the Holder to exercise any right
hereunder or otherwise granted at law or equity shall not affect or release
Issuer from its liability hereunder and shall not constitute a waiver of such
right unless so stated by the Holder in writing and then only in the specific
instance and for the specific purpose given.
5.10 Binding Effect. The Promissory Note shall inure to the benefit of the
Holder and its successors and assigns, and shall be binding upon Issuer, its
permitted successors and assigns.
5.11 Governing Law. THIS PROMISSORY NOTE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
ITS PRINCIPLES OR RULES OF CONFLICT OF LAWS (OTHER THAN GOL Section 5-1401 OR
ANY SUCCESSOR PROVISION).
5.12 Consent to Jurisdiction. Issuer and, by its acceptance of this
Promissory Note, the Holder agree that any and all actions arising under or in
respect of this Promissory Note may be litigated in any federal or state court
of competent jurisdiction located in the State of New York. Each of Issuer and
the Holder irrevocably submits to the personal and non-exclusive jurisdiction of
such courts for itself and in respect of its property with respect to such
action. Issuer and the Holder each agree that venue would be proper in any of
such courts, and hereby waive any objection that any such court is an improper
or inconvenient forum for the resolution of any such action. Issuer and the
Holder further agree that the mailing by certified or registered mail, return
receipt requested, to the addresses specified for notice in the Agreement of any
process or summons required by any such court shall constitute valid and lawful
service of process against it, without the necessity for service by any other
means provided by statute or rule of court.
5.13 Time. Time is of the essence under this Promissory Note.
5.14 WAIVER OF JURY TRIAL. EACH OF THE ISSUER AND, BY ITS ACCEPTANCE OF
THIS PROMISSORY NOTE, THE HOLDER HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY AND ALL
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RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS PROMISSORY NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY.
[signature page follows]
13
IN WITNESS WHEREOF, Issuer has executed this Promissory Note on
[__________].
P. H. GLATFELTER COMPANY
By:
------------------------------------
Name:
Title:
EXHIBIT C
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Term Loan Agreement, dated as of January 15,
2008 (as amended, supplemented or otherwise modified from time to time, the
"Term Loan Agreement"), among GPW VIRGINIA TIMBERLANDS LLC (the "Borrower"), the
several banks and other financial institutions or entities from time to time
parties thereto (the "Lenders"), and SUNTRUST BANK, as agent for the Lenders (in
such capacity, the "Agent"). Unless otherwise defined herein, terms defined in
the Term Loan Agreement and used herein shall have the meanings given to them in
the Term Loan Agreement.
The Assignor identified on Schedule 1 hereto (the "Assignor") and the
Assignee identified on Schedule 1 hereto (the "Assignee") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably purchases
and assumes from the Assignor without recourse to the Assignor, as of the
Effective Date (as defined below), the interest described in Schedule 1 hereto
(the "Assigned Interest") in and to the Assignor's rights and obligations under
the Term Loan Agreement with respect to the Term Loan in the Term Loan Agreement
as are set forth on Schedule 1 hereto (individually, an "Assigned Loan";
collectively, the "Assigned Loans"), in a principal amount for each Assigned
Loan as set forth on Schedule 1 hereto.
2. The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Term Loan Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Term Loan Agreement, any other Loan Document or any other instrument or
document furnished pursuant thereto, other than that the Assignor has not
created any adverse claim upon the interest being assigned by it hereunder and
that such interest is free and clear of any such adverse claim; (b) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any obligor or the performance or
observance by the Borrower or any obligor of any of its obligations under the
Term Loan Agreement or any other Loan Document or any other instrument or
document furnished pursuant hereto or thereto; and (c) attaches any Notes held
by it evidencing the Assigned Loan and [(i)] requests that the Agent, upon
request by the Assignee, exchange the attached Term Notes, if any, for a new
Term Note or Term Notes payable to the Assignee [and (ii) if the Assignor has
retained any interest in an Assigned Loan, requests that the Agent exchange the
attached Term Notes, if any, for a new Term Note or Term Notes payable to the
Assignor, in each case] in amounts which reflect the assignment being made
hereby (and after giving effect to any other assignments which have become
effective on the Effective Date).
3. The Assignee (a) represents and warrants that it is legally authorized
to enter into this Assignment and Acceptance including without limitation, the
requirement that it be a "qualified purchaser" as defined in Section 2(a)(51) of
the Investment Company Act of 1940; (b) confirms that it has received a copy of
the Term Loan Agreement and each other Loan Document which such Assignee has
requested, and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into this Assignment and
Acceptance; (c) agrees that it will, independently and without reliance upon the
Assignor, the 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 decisions in taking or not taking action under the Term Loan Agreement,
the other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto; (d) appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers and discretion under the Term
Loan Agreement, the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto as are delegated to the Agent by the terms
thereof, together with such powers as are incidental thereto; and (e) agrees
that it will be bound by the provisions of the Term Loan Agreement and will
perform in accordance with its terms all the obligations which by the terms of
the Term Loan Agreement are required to be performed by it as a Lender including
its obligations, if any, pursuant to Section 2.14 of the Term Loan Agreement.
4. The effective date of this Assignment and Acceptance shall be the
Effective Date of Assignment described in Schedule 1 hereto (the "Effective
Date"). Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent for acceptance by it and recording by the Agent pursuant
to the Term Loan Agreement, effective as of the Effective Date (which shall not,
unless otherwise agreed to by the Agent, be earlier than five Business Days
after the date of such acceptance and recording by the Agent).
5. Upon such acceptance and recording, from and after the Effective Date,
the Agent shall make all payments in respect of the Assigned Interest (including
payments of principal, interest, fees and other amounts) [to the Assignor for
amounts which have accrued to the Effective Date and to the Assignee for amounts
which have accrued subsequent to the Effective Date] [to the Assignee whether
such amounts have accrued prior to the Effective Date or accrue subsequent to
the Effective Date. The Assignor and the Assignee shall make all appropriate
adjustments in payments by the Agent for periods prior to the Effective Date or
with respect to the making of this assignment directly between themselves.]
6. From and after the Effective Date, (a) the Assignee shall be a party to
the Term Loan Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and under the
other Loan Documents and shall be bound by the provisions thereof and (b) the
Assignor shall, to the extent provided in this Assignment and Acceptance and the
Term Loan Agreement, relinquish its rights and be released from its obligations
under the Term Loan Agreement.
7. This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.
Schedule 1
to Assignment and Acceptance
Name of Assignor:
----------------------
Name of Assignee:
----------------------
Effective Date of Assignment:
----------
Principal Amount Assigned Percentage Assigned
------------------------- -------------------
$__________ _____%
[Name of Assignee] [Name of Assignor]
------------------------------------- ----------------------------------------
Name: Name:
Title: Title:
Accepted: Consented to (if required pursuant
to the Term Loan Agreement):
SUNTRUST BANK, GPW VIRGINIA TIMBERLANDS LLC
as Agent
------------------------------------- ----------------------------------------
Name: Name:
Title: Title:
4