EXHIBIT 10.7
SECOND AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
DATED AS OF SEPTEMBER 24, 2001
BY AND AMONG
NUCO2 INC.,
THE LENDERS FROM TIME TO TIME PARTIES HERETO,
SUNTRUST BANK, AS SUCCESSOR BY MERGER TO
SUNTRUST BANK, SOUTH FLORIDA, NATIONAL ASSOCIATION,
AS ADMINISTRATIVE AGENT, AS ISSUING BANK AND
AS SWING LINE LENDER,
▇▇▇▇▇▇ FINANCIAL, INC., AS SYNDICATION AGENT,
BNP PARIBAS, AS DOCUMENTATION AGENT,
AND
SUNTRUST ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ CAPITAL MARKETS,
A DIVISION OF SUNTRUST CAPITAL MARKETS, INC.,
AS ARRANGER
TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................................................2
SECTION 1.01 Definitions.................................................................................2
SECTION 1.02 Calculations; Accounting Terms.............................................................18
SECTION 1.03 Other Definitional Provisions..............................................................18
SECTION 1.04 Captions...................................................................................19
ARTICLE II AMOUNT AND TERMS OF LOANS.........................................................................19
SECTION 2.01 Revolving Loan Commitments and Revolving Notes; Increase in Revolving Loan Commitments.....19
SECTION 2.02 Method of Borrowing Under the Commitments..................................................21
SECTION 2.03 Swing Line Subcommitment...................................................................22
SECTION 2.04 Letter of Credit Subcommitment.............................................................24
SECTION 2.05 Notice of Issuance of Letter of Credit; Agreement to Issue.................................24
SECTION 2.06 Payment of Amounts drawn under Letter of Credit............................................25
SECTION 2.07 Payment by Lenders.........................................................................25
SECTION 2.08 Obligations Absolute.......................................................................26
SECTION 2.09 Indemnification; Nature of Administrative Agent's Duties...................................27
SECTION 2.10 Prepayment of Borrowings Under the Commitments.............................................27
SECTION 2.11 Mandatory Prepayments......................................................................27
SECTION 2.12 Voluntary Reduction of Commitments.........................................................28
SECTION 2.13 Allocation of Payments.....................................................................28
SECTION 2.14 Termination of Commitments.................................................................29
SECTION 2.15 Use of Proceeds............................................................................29
SECTION 2.16 Fees 29
SECTION 2.17 Interest...................................................................................30
SECTION 2.18 Interest Periods...........................................................................31
SECTION 2.19 Increased Costs............................................................................31
SECTION 2.20 Capital Adequacy...........................................................................33
SECTION 2.21 Funding Losses.............................................................................33
SECTION 2.22 Making of Payments.........................................................................34
SECTION 2.23 Default Rate of Interest...................................................................34
SECTION 2.24 Proration of Payments......................................................................34
SECTION 2.25 Lenders' Obligations Several...............................................................35
SECTION 2.26 Payments Free of Taxes.....................................................................35
SECTION 2.27 Interest Rate Not Ascertainable, etc.......................................................37
SECTION 2.28 Illegality.................................................................................37
ARTICLE III CONDITIONS TO BORROWINGS..........................................................................38
SECTION 3.01 Conditions Precedent to Initial Advances...................................................38
SECTION 3.02 Conditions Precedent to Each Advance and Letters of Credit.................................41
SECTION 3.03 Effect of Amendment and Restatement........................................................42
ARTICLE IV REPRESENTATIONS AND WARRANTIES....................................................................43
SECTION 4.01 Corporate Status of Company; Status of Subsidiaries........................................43
SECTION 4.02 Corporate Power and Authority..............................................................44
SECTION 4.03 Compliance with Other Instruments..........................................................44
SECTION 4.04 Enforceable Obligations....................................................................44
SECTION 4.05 Governmental Authorizations................................................................45
SECTION 4.06 Intellectual Property......................................................................45
SECTION 4.07 Outstanding Indebtedness...................................................................45
SECTION 4.08 Insurance Coverage.........................................................................45
SECTION 4.09 Title to Properties........................................................................45
SECTION 4.10 No Burdensome Restrictions.................................................................46
SECTION 4.11 No Material Violation of Law...............................................................46
SECTION 4.12 No Default Under Other Agreements..........................................................46
SECTION 4.13 No Equity Investments......................................................................46
SECTION 4.14 Financial Statements.......................................................................46
SECTION 4.15 Litigation.................................................................................46
SECTION 4.16 Taxes 47
SECTION 4.17 Margin Regulations.........................................................................47
SECTION 4.18 ERISA 47
SECTION 4.19 Compliance With Environmental Laws.........................................................49
SECTION 4.20 Possession of Material Patents, Trademarks, Etc............................................49
SECTION 4.21 Subsidiaries...............................................................................49
SECTION 4.22 Disclosure.................................................................................50
SECTION 4.23 Projections................................................................................50
SECTION 4.24 Subordinated Debt..........................................................................50
ARTICLE V AFFIRMATIVE COVENANTS.............................................................................50
SECTION 5.01 Use of Proceeds............................................................................50
SECTION 5.02 Interest Rate Protection...................................................................51
SECTION 5.03 Reporting Covenants........................................................................51
SECTION 5.04 Maintenance of Properties..................................................................52
SECTION 5.05 Maintenance of Insurance...................................................................52
SECTION 5.06 Maintenance of Books; Inspection of Property and Records...................................52
SECTION 5.07 Existence and Status.......................................................................53
SECTION 5.08 Taxes and Claims...........................................................................53
SECTION 5.09 Compliance with Laws, Etc..................................................................53
SECTION 5.10 ERISA......................................................................................53
SECTION 5.11 Litigation.................................................................................54
SECTION 5.12 Notice of Events of Default................................................................54
SECTION 5.13 Stockholder Reports, etc...................................................................55
SECTION 5.14 Future Guarantors..........................................................................55
SECTION 5.15 Ownership of Guarantors....................................................................55
SECTION 5.17 Notices to Holders of Subordinated Debt...................................................56
ARTICLE VI NEGATIVE COVENANTS................................................................................56
SECTION 6.01 Limitation on Liens and Security Interests.................................................56
SECTION 6.02 Indebtedness...............................................................................57
SECTION 6.03 Compliance with ERISA......................................................................57
SECTION 6.04 Sale and Leaseback.........................................................................58
SECTION 6.05 Transactions with Affiliates...............................................................58
SECTION 6.06 Guaranties.................................................................................58
SECTION 6.07 Limitations on Payment Restrictions........................................................58
SECTION 6.08 Merger; Joint Ventures; Sale of Assets.....................................................58
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SECTION 6.09 Dividends; Loans, Investments, Advances....................................................59
SECTION 6.10 Nature of Business.........................................................................60
SECTION 6.11 Sale of Subsidiaries.......................................................................60
SECTION 6.12 Negative Pledges...........................................................................60
SECTION 6.13 Creation of Subsidiaries...................................................................60
SECTION 6.14 Prepayments Under and Amendment of Other Agreements........................................60
SECTION 6.15 Capital Expenditures.......................................................................61
SECTION 6.16 Changes Related to Preferred Stock.........................................................61
SECTION 6.17 Changes in Fiscal Year or Fiscal Quarter...................................................61
ARTICLE VII FINANCIAL COVENANTS...............................................................................62
SECTION 7.01 Senior Debt Coverage Ratio.................................................................62
SECTION 7.02 Total Debt Coverage Ratio..................................................................62
SECTION 7.03 Debt Service Coverage Ratio................................................................62
SECTION 7.04 Minimum EBITDA.............................................................................62
ARTICLE VIII EVENTS OF DEFAULT AND REMEDIES....................................................................63
SECTION 8.01 Events of Default..........................................................................63
SECTION 8.02 Remedies on Default........................................................................64
ARTICLE IX THE AGENT 65
SECTION 9.01 Appointment of Administrative Agent........................................................65
SECTION 9.02 Nature of Duties of Administrative Agent...................................................66
SECTION 9.03 Lack of Reliance on the Administrative Agent...............................................67
SECTION 9.04 Certain Rights of the Administrative Agent.................................................67
SECTION 9.05 Reliance by Administrative Agent...........................................................67
SECTION 9.06 The Administrative Agent in its Individual Capacity........................................67
SECTION 9.07 Successor Administrative Agent.............................................................68
SECTION 9.08 Authorization to Execute other Loan Documents..............................................68
SECTION 9.09 Indemnification............................................................................68
ARTICLE X MISCELLANEOUS.....................................................................................69
SECTION 10.01 Survival...................................................................................69
SECTION 10.02 Amendments; Consents.......................................................................69
SECTION 10.03 Notices....................................................................................70
SECTION 10.04 Severability; Time of Essence..............................................................71
SECTION 10.05 Governing Law; Submission to Jurisdiction..................................................71
SECTION 10.06 Payment of Costs...........................................................................72
SECTION 10.07 Indemnity..................................................................................73
SECTION 10.08 Benefit of the Agreement...................................................................73
SECTION 10.09 Subordination of Indebtedness..............................................................74
SECTION 10.10 Maximum Interest Rate......................................................................74
SECTION 10.11 Entire Agreement...........................................................................75
SECTION 10.12 Set-Off....................................................................................75
SECTION 10.13 Counterparts...............................................................................75
SECTION 10.14 Replacement Notes..........................................................................75
SECTION 10.15 Release....................................................................................75
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Annexes
Annex A Capital Expenditures
Exhibits
Exhibit A - Form of Revolving Note
Exhibit B - Form of Swing Line Note
Exhibit C - Form of Notice of Borrowing
Exhibit D - Form of Guaranty Agreement
Exhibit E - Form of Contribution Agreement
Exhibit F - Form of Closing Certificate
Exhibit G - Form of Opinion of Counsel of the Company and the Guarantors
Exhibit H - Form of Compliance Certificate
Exhibit I - Form of Assignment Agreement
Exhibit J - Projections
Schedules
Schedule 4.07 - Outstanding Indebtedness
Schedule 4.08 - Insurance Certificates
Schedule 4.18 - ERISA
Schedule 4.21 - Subsidiaries
Schedule 6.01 - Liens
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SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
THIS SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated
as of September 24, 2001, by and among NUCO2 INC., a Florida corporation (the
"Company"), SUNTRUST BANK, a Georgia banking corporation, as successor by merger
to SunTrust Bank, South Florida, National Association, a national banking
association ("SunTrust"), and the other banks and lending institutions that are
signatories to this Agreement or that hereafter become "Lenders" as provided
herein (SunTrust and such other banks and lending institutions, individually a
"Lender" and collectively, the "Lenders"), SunTrust in its capacity as
Administrative Agent for the Lenders (the "Administrative Agent"), as Issuing
Bank (the "Issuing Bank"), and as Swing Line Lender (the "Swing Line Lender"),
▇▇▇▇▇▇ Financial, Inc., a Delaware corporation, in its capacity as Syndication
Agent (the "Syndication Agent"), and BNP Paribas, a French banking organization
acting through its New York branch, in its capacity as Documentation Agent (the
"Documentation Agent").
W I T N E S S E T H :
-------------------
WHEREAS, the Company, the Administrative Agent and certain lenders
signatory thereto entered into that certain Amended and Restated Revolving
Credit Agreement, dated as of May 4, 1999, as amended by that certain First
Amendment to Amended and Restated Revolving Credit Agreement dated as of June
16, 1999, as amended by that certain Second Amendment and Waiver to Amended and
Restated Revolving Credit Agreement dated as of February 7, 2000, as amended by
that certain Third Amendment to Amended and Restated Revolving Credit Agreement
dated as of May 12, 2000, as amended by that certain Fourth Amendment to Amended
and Restated Revolving Credit Agreement dated as of September 28, 2000, and as
amended by that certain Fifth Amendment to Amended and Restated Revolving Credit
Agreement dated as of December 5, 2000 (the "Original Credit Agreement");
WHEREAS, certain financial institutions not parties to the Original
Credit Agreement (the "New Lenders") are willing to become Lenders hereunder and
to provide a portion of such revolving credit facility;
WHEREAS, the Company has requested, and the Lenders have agreed to
amend and restate the Original Credit Agreement to make certain amendments on
the terms and subject to the conditions set forth herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions. In addition to the other terms defined
herein, the following terms used herein shall have the meanings herein specified
(such meanings to be equally applicable to both the singular and plural forms of
the terms defined):
"Additional Guarantor" shall have the meaning assigned to such term
in Section 5.14(a).
"Administrative Agent" shall have the meaning set forth in the first
paragraph of this Agreement.
"Advance" shall mean any advance by a Lender under the Commitments.
"Administrative Agent Fee" shall mean the administrative fee
described in the fee letter, payable on the Closing Date and thereafter
annually in advance to the Administrative Agent during the period prior to
the Commitment Termination Date.
"Affiliate" shall mean, with respect to any Person, any other Person
(including all directors and officers of such Person) that, directly or
indirectly through one or more intermediaries, controls or is controlled
by, or is under common control with, such first Person. A Person shall be
deemed to control another Person if such first Person possesses, directly
or indirectly, the power to direct or cause the direction of the
management and policies of such other Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" shall mean the Administrative Agent, the Syndication Agent
and the Documentation Agent.
"Agreement" shall mean this Second Amended and Restated Revolving
Credit Agreement, either as originally executed or as hereafter amended,
restated, renewed, extended, supplemented or otherwise modified from time
to time.
"Annualized EBITDA" shall mean (i) for the quarter ending September
30, 2001, EBITDA for the fiscal quarter ending on the last day of such
quarter multiplied by four; (ii) for the quarter ending December 31, 2001,
the sum of (a) EBITDA for the fiscal quarter ending on the last day of
such quarter plus (b) EBITDA for the fiscal quarter ending on the last day
of September 30, 2001, multiplied by two; (iii) for the quarter ending
March 31, 2002, the sum of (a) EBITDA for the fiscal quarter ending on the
last day of such quarter plus (b) EBITDA for the fiscal quarter ending on
the last day of December 31, 2001 plus (c) EBITDA for the fiscal quarter
ending on the last day of September 30, 2001, divided by three and then
multiplied by four; and (iv) for the quarter ending June 30, 2002 and
thereafter, EBITDA for the four preceding fiscal quarters ending on the
last day of such quarter; provided, however, to EBITDA for the quarter
ending September 30, 2001, while that quarter is used in the Annualized
EBITDA calculation for such quarter and each subsequent quarter, shall be
2
added non-recurring charges associated with the amortization of remaining
loan fees and any waiver fees and any termination cost associated with the
Company's current interest rate protection agreement during such quarter
in the amount of $1,600,000.00.
"Annualized Interest Expense" shall mean (i) for the quarter ending
September 30, 2001, Interest Expense for the fiscal quarter ending on the
last day of such quarter multiplied by four; (ii) for the quarter ending
December 31, 2001, the sum of (a) Interest Expense for the fiscal quarter
ending on the last day of such quarter plus (b) Interest Expense for the
fiscal quarter ending on the last day of September 30, 2001, multiplied by
two; (iii) for the quarter ending March 31, 2002, the sum of (a) Interest
Expense for the fiscal quarter ending on the last day of such quarter plus
(b) Interest Expense for the fiscal quarter ending on the last day of
December 31, 2001 plus (c) Interest Expense for the fiscal quarter ending
on the last day of September 30, 2001, divided by three and then
multiplied by four; and (iv) for the quarter ending June 30, 2002 and
thereafter, Interest Expense for the four preceding fiscal quarters ending
on the last day of such quarter.
"Applicable Commitment Fee Percentage" shall mean the percentage
designated below based on the Company's Total Debt Coverage Ratio for each
fiscal quarter-end, as indicated below:
Total Debt Coverage Ratio Applicable Commitment
Fee Percentage
Less than 2.50:1.0 0.375%
Greater than or equal to 2.50:1.0 and less than 3.00:1.0 0.375%
Greater than or equal to 3.00:1.0 and less than 3.50:1.0 0.50%
Greater than or equal to 3.50:1.0 and less than 4.00:1.0 0.50%
Greater than or equal to 4.00:1.0 0.50%
Each change in the Applicable Commitment Fee Percentage resulting from a
change in the Total Debt Coverage Ratio shall be effective on the first
Business Day immediately following the date of delivery to the
Administrative Agent of the annual financial statements required under
Section 5.03(a)(i), or the quarterly financial statements for each Fiscal
Quarter required under Section 5.03(a)(ii), as applicable, in each case
together with the Compliance Certificate required by Section 5.03(a)(ii),
indicating such change; provided, however, from the Closing Date through
and including March 31, 2002, the Applicable Commitment Fee Percentage
shall be 0.50%; provided, further, at any time any Default under Section
8.01(a), (j) or (k) or Event of Default has occurred and is continuing,
the Applicable Commitment Fee Percentage shall be 0.50%.
"Applicable Law" shall mean, anything in Section 10.05
notwithstanding, (i) all applicable common law and principles of equity
and (ii) all applicable provisions of all (a) constitutions, statutes,
3
rules, regulations and orders of governmental bodies, (b) Governmental
Approvals, and (c) orders, decisions, judgments and decrees of all courts
and arbitrators.
"Applicable Margin" shall mean the percentage designated below based
on the Company's Total Debt Coverage Ratio for each fiscal quarter-end, as
indicated below:
Total Debt Coverage Ratio Applicable Margin Applicable Margin
(LIBOR Advance) (Base Rate Advance)
Less than 2.50:1.0 2.50% 1.50%
Greater than or equal to 2.50:1.0
and less than 3.00:1.0 2.75% 1.75%
Greater than or equal to 3.00:1.0
and less than 3.50:1.0 3.00% 2.00%
Greater than or equal to 3.50:1.0
and less than 4.00:1.0 3.25% 2.25%
Greater than or equal to 4.00:1.0 3.50% 2.50%
Each change in the Applicable Margin resulting from a change in the Total
Debt Coverage Ratio shall be effective on the first Business Day
immediately following the date of delivery to the Administrative Agent of
the annual financial statements required under Section 5.03(a)(i), or the
quarterly financial statements for each Fiscal Quarter required under
Section 5.03(a)(ii), as applicable, in each case together with the
Compliance Certificate required by Section 5.03(a)(ii), indicating such
change; provided, however, that for the period commencing on the Closing
Date through and including March 31, 2002, the Applicable Margin on LIBOR
Advances and Base Rate Advances shall be 3.50% and 2.50%, respectively.
Notwithstanding the foregoing and subject to Section 2.23, at any time
during which the Company has failed to deliver such financial statements
and certificates when required by Sections 5.03(a)(i) and 5.03(a)(ii), as
applicable, the Applicable Margin shall be increased by 2% per annum,
until such time as the delinquent financial statements are delivered, at
which time the Applicable Margin shall be reset as provided above.
"Asset Value" shall mean, with respect to any property or asset of
the Company or any of its Subsidiaries as of any particular date, an
amount equal to the then book value of such property or asset as
established in accordance with GAAP.
"Assignment Agreement" shall mean an agreement in the form of
Exhibit I.
"Assignment of Leases" shall mean that certain Assignment of Leases
agreement, dated as of October 31, 1997, executed by the Company and each
Subsidiary in favor of the Administrative Agent, assigning the Company's
and each Subsidiary's lessee's interest in any leasehold (except those
leaseholds whose terms prohibit assignments), as the same may be hereafter
amended, restated, renewed, extended, supplemented or otherwise modified
from time to time.
4
"Availability" shall mean, with respect to any Commitment, at any
time, the amount by which such Commitment exceeds all Advances outstanding
under such Commitment.
"Bankruptcy Law" shall mean laws governing bankruptcy, suspension of
payments, reorganization, arrangement, adjustment of debts, relief of
debtors, dissolution, or other similar laws relating to the enforcement of
creditors' rights generally.
"Base Rate" shall mean the higher of (i) the rate which SunTrust
designates from time to time as 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%) per annum (any changes in such
rates to be effective as of the date of any change in such rate). The
SunTrust prime lending rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged to any customer.
SunTrust may make commercial loans or other loans at rates of interest at,
above, or below the SunTrust prime lending rate.
"Base Rate Advance" shall mean any Advance made to the Company by
the Lenders at an interest rate equal to the Base Rate plus the Applicable
Margin for such Advance.
"Borrowing" shall mean a borrowing under the Commitments consisting
of simultaneous Advances by the Lenders, including Swing Line Borrowings.
"Business Day" shall mean a day of the year other than Saturday,
Sunday or any other day on which the Administrative Agent is required to
close.
"Capital Expenditures" shall mean, for any period, expenditures made
by the Company and its Subsidiaries to acquire or construct fixed assets,
property, plant, and equipment (including renewals, improvements and
replacements, but excluding repairs) and customer accounts during such
period computed in accordance with GAAP.
"Capital Stock" means all shares of capital stock of or in a Person,
whether voting or non-voting, and including, without limitation, common
stock, preferred stock and options or warrants to purchase or otherwise
acquire any such capital stock.
"CERCLA" shall mean the Comprehensive Environmental Response
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act (42 U.S.C. ss. 9601 et seq.).
"Change in Control" shall mean the occurrence of one or more of the
following events: (a) any sale, lease, exchange or other transfer (in a
single transaction or a series of related transactions) of all or
substantially all of the assets of the Company to any Person or "group"
(within the meaning of the Exchange Act and the rules of the Securities
and Exchange Commission thereunder in effect on the date hereof), (b) the
acquisition of ownership, directly or indirectly, beneficially or of
record, by any Person or "group" (within the meaning of the Exchange Act
and the rules of the Securities and Exchange Commission thereunder as in
effect on the date hereof) of 40% or more of the outstanding shares of the
5
voting stock of the Company; (c) occupation of a majority of the seats
(other than vacant seats) on the board of directors of the Company by
Persons who were neither (i) nominated by the current board of directors
or (ii) appointed by directors so nominated, or (d) a "change in control"
under any Subordinated Debt.
"Closing Date" shall mean September 24, 2001.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued
thereunder.
"Collateral" shall mean all real and personal property and assets,
including, without limitation, all intangible property, now or hereafter
existing, of the Company and its Subsidiaries over which the Company or
such Subsidiary has granted a Lien to the Administrative Agent pursuant to
the Security Documents, and all proceeds and products thereof.
"Commitments" shall mean, collectively, the Revolving Loan
Commitments, the Letter of Credit Subcommitment and the Swing Line
Subcommitment.
"Commitment Fee" shall have the meaning set forth in Section
2.16(b).
"Commitment Termination Date" shall have the meaning set forth in
Section 2.01.
"Company" shall have the meaning set forth in the first paragraph of
this Agreement.
"Company Pledge Agreement" shall mean that certain Stock and Notes
Pledge Agreement (Company), dated as of October 31, 1997, executed by the
Company in favor of the Administrative Agent, as amended by that certain
First Amendment to Stock and Notes Pledge Agreement (Company), dated as of
May 4, 1999, as amended by that certain Second Amendment to Stock and
Notes Pledge Agreement (Company), dated as of the Closing Date, and as
hereafter amended, restated, supplemented or otherwise modified from time
to time.
"Company Security Agreement" shall mean that certain Amended and
Restated Security Agreement (Company), dated as of the Closing Date, and
as hereafter amended, restated, supplemented or otherwise modified from
time to time.
"Company Trademark Security Agreement" shall mean that certain
Trademark Security Agreement (Company), dated as of October 31, 1997,
executed by the Company in favor of the Administrative Agent, as amended
by the First Amendment to Trademark Security Agreement (Company), dated as
of May 4, 1999, as amended by that certain Second Amendment to Trademark
Security Agreement (Company), dated as of the Closing Date, and as
hereafter amended, restated, supplemented or otherwise modified from time
to time.
"Compliance Certificate" shall have the meaning set forth in Section
5.03(a)(ii).
6
"Consolidated Companies" shall mean, collectively, the Company and
all of its Subsidiaries.
"Consolidated Net Income (Loss)" shall mean, for any fiscal period
of the Company, the net income (or loss) of the Company and its
Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, but excluding therefrom (to the extent otherwise
included therein) (i) any extraordinary gains or losses, (ii) any gains
attributable to write-ups of assets and (iii) any equity interest of the
Company or any Subsidiary of the Company in the unremitted earnings of any
Person that is not a Subsidiary and (iv) any income (or loss) of any
Person accrued prior to the date it becomes a Subsidiary or is merged into
or consolidated with the Company or any Subsidiary or the date that such
Person's assets are aquired by the Company or any Subsidiary.
"Consolidated Net Worth" shall mean, as of the date of
determination, the total shareholders' equity of the Company and its
Subsidiaries, determined in accordance with GAAP.
"Contractual Obligations" of any Person shall mean any provision of
any security issued by such Person or of any agreement, instrument or
undertaking under which such Person is obligated or by which it or any of
its property is bound.
"Contribution Agreement" shall mean that certain Amended and
Restated Contribution Agreement, dated as of May 4, 1999, as amended by
that certain First Amendment to Amended and Restated Contribution
Agreement, dated as of the Closing Date, executed by the Company and each
of the Guarantors, a copy of which is attached hereto as Exhibit E
attached hereto, as hereafter amended, restated, supplemented or otherwise
modified from time to time.
"Debt Service Coverage Ratio" shall mean, for any fiscal period of
the Company and its Subsidiaries on a consolidated basis, as of any date
of determination, the ratio of (a) Annualized EBITDA for the fiscal period
ending on the last day of such period, to (b) the sum of (x) Annualized
Interest Expense for the fiscal period ending on the last day of such
period plus (y) one-seventh (1/7) of the then outstanding balance of
Senior Debt.
"Default" shall mean any event that, with the giving of notice, or
lapse of time, or both, would constitute an Event of Default.
"Documentation Agent" shall have the meaning set forth in the first
paragraph of this Agreement.
"EBITDA" shall mean, for the Company and its Subsidiaries for any
period, an amount equal to the sum of (a) Consolidated Net Income (Loss)
for such period PLUS (b) to the extent deducted in determining
Consolidated Net Income (Loss) for such period, (i) Interest Expense, (ii)
income tax expense, and (iii) depreciation and amortization, determined on
a consolidated basis in accordance with GAAP in each case for such period.
7
"Environmental Indemnity" shall mean that certain Environmental
Indemnity Agreement, dated as of the Closing Date, executed by the Company
in favor of Administrative Agent on behalf of the Lenders, as amended,
restated, modified or otherwise supplemented.
"Environmental Laws" shall mean all federal, state, local and
foreign statutes and codes or regulations, rules or ordinances issued,
promulgated, or approved thereunder, now or hereafter in effect
(including, without limitation, those with respect to asbestos or asbestos
containing material or exposure to asbestos or asbestos containing
material), relating to pollution or protection of the environment and
relating to public health and safety, relating to (i) emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals or industrial toxic or hazardous constituents, substances or
wastes, including without limitation, any Hazardous Substance (as such
term is defined under CERCLA), petroleum including crude oil or any
fraction thereof, any petroleum product or other waste, chemicals or
substances regulated by any Environmental Law into the environment
(including without limitation, ambient air, surface water, ground water,
land surface or subsurface strata), or (ii) the manufacture, processing,
distribution, use, generation, treatment, storage, disposal, transport or
handling of any Hazardous Substance (as such term is defined under
CERCLA), petroleum including crude oil or any fraction thereof, any
petroleum product or other waste, chemicals or substances regulated by any
Environmental Law, and (iii) underground storage tanks and related piping,
and emissions, discharges and releases or threatened releases therefrom,
such Environmental Laws to include, without limitation (i) the Clean Air
Act (42 ▇.▇.▇.▇▇. 7401 et seq.), (ii) the Clean Water Act (33 ▇.▇.▇.▇▇.
1251 et seq.), (iii) the Resource Conservation and Recovery Act (42
▇.▇.▇.▇▇. 6901 et seq.), (iv) the Toxic Substances Control Act (15
U.S.C.ss.2601 et seq.) and (v) CERCLA.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974 and all rules and regulations promulgated pursuant thereto, as the
same may from time to time be supplemented or amended.
"ERISA Affiliate" shall mean any trade or business (whether
incorporated or unincorporated) which together with the Company is treated
as a single employer under Section 414(b), (c), (m) or (o) of the Code.
"Event of Default" shall have the meaning set forth in Article VIII.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute thereto.
"Executive Officer" shall mean each of the executive officers of the
Company and any Person hereafter holding the following office or offices
which, individually or collectively, are assigned substantially similar
duties: Chief Executive Officer, President and Chief Financial Officer.
"Facilities" shall mean, collectively, the Commitments described
hereunder.
8
"Federal Funds Rate" shall mean, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers,
as published for such day (or, if such day is not a Business Day, for the
next preceding Business Day) by the Federal Reserve Bank of Atlanta, or,
if such rate is not so published for any day which is a Business Day, the
average of the quotations for such day on such transactions received by
the Administrative Agent from three Federal funds brokers of recognized
standing selected by it.
"Fees" shall mean, collectively, the Administrative Agent Fee and
the Letter of Credit Fee.
"Fiscal Quarter" shall mean a fiscal quarter of the Company with
each such fiscal quarter ending on each March 31, June 30, September 30,
and December 31.
"Fiscal Year" shall mean a fiscal year of the Company; references to
a Fiscal Year with a number corresponding to any calendar year (e.g., the
"Fiscal Year 2001") refers to the Fiscal Year ending during such calendar
year with each such fiscal year ending on June 30.
"Foreign Plan" shall mean any pension, profit sharing, deferred
compensation, or other employee benefit plan, program or arrangement
maintained by any foreign subsidiary which, under applicable local law, is
required to be funded through a trust or other funding vehicle.
"GAAP" shall mean generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such
other statements by such other entity as may be approved by a significant
segment of the accounting profession in the United States of America,
which are applicable to the circumstances as of the date of determination;
provided, that for purposes of determining compliance with the financial
covenant levels in Article VII, such levels shall be determined on the
basis of GAAP in effect as of June 30, 2001.
"Governmental Approval" shall mean any order, permission,
authorization, consent, approval, license, franchise, permit or validation
of, exemption by, registration or filing with, or report or notice to, any
governmental agency or unit, or any public commission, board or authority.
"Guarantor Pledge Agreement" shall mean that certain Stock and Notes
Pledge Agreement (Guarantors), dated as of October 31, 1997, executed by
each Guarantor in favor of the Administrative Agent, as amended by that
certain First Amendment to Stock and Notes Pledge Agreement (Guarantors),
9
dated as of May 4, 1999, as amended by that certain Second Amendment to
Stock and Notes Pledge Agreement (Guarantors), dated as of the Closing
Date, and as hereafter amended, restated, supplemented or otherwise
modified from time to time.
"Guarantor Security Agreement" shall mean that certain Amended and
Restated Security Agreement (Guarantors), dated as of the Closing Date,
and as hereafter amended, restated, supplemented or otherwise modified
from time to time.
"Guarantor Trademark Security Agreement" shall mean that certain
Trademark Security Agreement (Guarantors), dated as of October 31, 1997,
executed by each Guarantor in favor of the Administrative Agent, as
amended by that certain First Amendment to Trademark Security Agreement
(Guarantors), dated as of May 4, 1999, as amended by that certain Second
Amendment to Trademark Security Agreement (Guarantors), dated as of the
Closing Date, and as hereafter amended, restated, supplemented or
otherwise modified from time to time.
"Guarantors" shall mean, collectively, each Subsidiary of the
Company that has executed a Guaranty Agreement as of the Closing Date,
together with all other Subsidiaries that hereafter execute a Guaranty
Agreement, and their respective successors and permitted assigns.
"Guarantor" shall mean any of the Guarantors.
"Guaranty Agreement" shall mean that certain Amended and Restated
Guaranty Agreement, dated as of May 4, 1999, as amended by that certain
First Amendment to Amended and Restated Guaranty Agreement dated as of the
Closing Date, executed by each of the Guarantors in favor of the Lenders
and the Administrative Agent, substantially in the form of Exhibit D
attached hereto, as hereafter amended, restated, supplemented or otherwise
modified from time to time.
"Guaranty Documents" shall mean, collectively, the Guaranty
Agreement, and each other guaranty agreement, mortgage, deed of trust,
assignment of lease, security agreement, pledge agreement, or other
security or collateral document guaranteeing or securing the Obligations,
as the same may be amended, restated, or supplemented from time to time,
and the Contribution Agreement executed by each of the Guarantors, as the
same may be amended, restated or supplemented from time to time.
"Guaranty Obligations" shall mean the obligation of the Guarantors
to the Lenders and the Administrative Agent, as set forth in the Guaranty
Agreement.
"Hazardous Substance" shall have the meaning assigned to that term
in CERCLA.
"Indebtedness" of any person shall mean, without duplication, (i)
obligations of such person for borrowed money, (ii) obligations of such
person evidenced by bonds, debentures, notes or other similar instruments,
(iii) obligations of such person in respect of the deferred purchase price
of property or services (other than trade payables incurred in the
ordinary course of business on terms customary in the trade), (iv)
obligations of such person under any conditional sale or other title
retention agreement(s) relating to property acquired by such person, (v)
capitalized lease obligations of such person, (vi) obligations, contingent
or otherwise, of such person in respect of letters of credit, acceptances
or similar extensions of credit, (vii) all indebtedness of a third party
10
secured by any lien on property owned by such person, whether or not such
indebtedness has been assumed by such person, (viii) all obligations of
such person, contingent or otherwise, to purchase, redeem, retire or
otherwise acquire for value any common stock of such person, (ix)
off-balance sheet liability retained in connection with asset
securitization programs, synthetic leases, sale and leaseback transactions
or other similar obligations arising with respect to any other transaction
which is the functional equivalent of or takes the place of borrowing but
which does not constitute a liability on the consolidated balance sheet of
such person and its subsidiaries, (x) obligations under any interest rate
hedge agreement or foreign exchange agreement, and (xi) guaranties by such
person of the type of indebtedness described in clauses (i) through (x)
above.
"Interest Expense" shall mean, for any fiscal period of the Company,
total cash interest expense (including, without limitation, interest
expense attributable to capitalized leases in accordance with GAAP during
such period (whether or not actually paid during such period)) plus the
net amount payable (or minus the net amount receivable) under hedging
agreements during such period (whether or not actually paid during such
period) of the Company and its Subsidiaries, on a consolidated basis.
"Interest Period" shall mean (i) as to any LIBOR Advance, the
interest period selected by the Company pursuant to Section 2.18(a), and
with respect to a Swing Line Loan, a period of such duration not to exceed
thirty (30) days, as the Company may request and the Swing Line Lender may
agree in accordance with Section 2.03.
"Investment" shall mean, when used with respect to any Person, any
direct or indirect advance, loan or other extension of credit (other than
the creation of receivables in the ordinary course of business) or capital
contribution by such Person (by means of transfers of property to others
or payments for property or services for the account or use of others, or
otherwise) to any Person, or any direct or indirect purchase or other
acquisition by such Person of, or of a beneficial interest in, capital
stock, partnership interests, bonds, notes, debentures or other securities
or equity interests issued by any other Person.
"Issuing Bank" shall have the meaning set forth in the first
paragraph of this Agreement.
"Lenders" shall have the meaning set forth in the first paragraph of
this Agreement.
"Lending Office" shall mean, for each Lender, the office such Lender
may designate in writing from time to time to the Company and the
Administrative Agent with respect to Base Rate Advances and LIBOR
Advances.
"Letter of Credit Fee" shall have the meaning set forth in Section
2.16(c).
"Letter of Credit Obligations" shall mean, with respect to Letters
of Credit, as at any date of determination, the sum of (a) the maximum
aggregate amount which at such date of determination is available to be
drawn by the beneficiaries thereof (assuming the conditions for drawing
thereunder have been met) under all Letters of Credit then outstanding,
11
plus (b) the aggregate amount of all drawings under Letters of Credit
honored by the Administrative Agent not theretofore reimbursed by the
Company.
"Letter of Credit Subcommitment" shall mean $2,000,000.
"Letters of Credit" shall mean the letters of credit issued pursuant
to Section 2.04 hereof by the Administrative Agent for the account of the
Company pursuant to the Letter of Credit Subcommitment of the Revolving
Loan Commitments.
"LIBOR" shall mean, for any Interest Period, the offered rates for
deposits in U.S. dollars for a period comparable to the Interest Period
appearing on the Telerate Screen Page 3750, as of 11:00 a.m., London time,
on the day that is two London banking days prior to the Interest Period.
If at least two such rates appear on the Telerate Screen Page 3750, the
rate for that Interest Period will be the arithmetic mean of such rates,
and in either case as such rates may be adjusted for any applicable
reserve requirements.
"LIBOR Advance" shall mean any advance made to the Company by the
Lenders at an interest rate equal to LIBOR plus the Applicable Margin for
such Advance.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien, assignment or charge of any kind or description and
shall include, without limitation, any agreement to give any of the
foregoing, any conditional sale or other title retention agreement, any
lease in the nature thereof including any lease or similar arrangement
with a public authority executed in connection with the issuance of
industrial development revenue bonds or pollution control revenue bonds,
and the filing of or agreement to give any financing statement under the
Uniform Commercial Code (or comparable law) of any jurisdiction naming the
owner of the asset to which such lien applies as a debtor (other than a
filing which does not evidence an outstanding secured obligation, or a
commitment to make advances or to incur any other obligation of any kind).
"Loan Documents" shall mean this Agreement, each Exhibit and
Schedule to this Agreement, the Notes, the Guaranty Documents, the
Security Documents, the Letters of Credit, and each other document,
instrument, certificate and opinion executed and delivered in connection
with the foregoing, each as amended, restated, supplemented or otherwise
modified from time to time as provided in Section 10.02.
"Margin Regulations" shall mean Regulation T, Regulation U and
Regulation X of the Board of Governors of the Federal Reserve System, as
the same may be in effect from time to time.
"Material Contract" shall mean any contract or other agreement,
written or oral, of the Company or its Subsidiaries the failure to comply
with which could reasonably be expected to have a Materially Adverse
Effect.
"Materially Adverse Effect" shall mean a materially adverse change
in the operations, business, property or assets of, or in the condition
(financial or otherwise) or prospects of, the Company and its
Subsidiaries, taken as a whole; provided, however, that realization of the
12
costs and charges taken by the Company for the Fiscal Quarter ending June
30, 2001 in the amount of $7,600,000.00 shall not be considered a material
adverse change; provided, further, that realization of the costs and
charges taken by the Company for the Fiscal Quarter ending September 30,
2001 in the amount of $1,600,000.00 shall not be considered a material
adverse change.
"Maximum Permissible Rate" shall mean, with respect to interest
payable on any amount, the rate of interest on such amount that, if
exceeded, could, under Applicable Law, result in (i) civil or criminal
penalties being imposed on any Lender or (ii) any Lender being unable to
enforce payment of (or if collected, to retain) all or part of such amount
or the interest payable thereon.
"Mortgaged Property" shall mean, collectively, all parcels of real
property owned or leased by the Company or any of its Subsidiaries which
is subject to a Mortgage or which is assigned under an Assignment of
Leases.
"Mortgages" shall mean, collectively, all of the mortgages,
leasehold mortgages, deeds of trust or deeds to secure debt hereafter
executed in favor of the Administrative Agent by the Company or any
Subsidiary, as the same may be hereafter amended, restated, renewed,
extended, supplemented or otherwise modified from time to time.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA as to which the Company, any Subsidiary or any
ERISA Affiliate is obligated to make, has made, or will be obligated to
make contributions on behalf of participants who are or were employed by
any of them.
"Notes" shall mean, collectively, the Revolving Notes and the Swing
Line Note.
"Notice of Borrowing" shall have the meaning set forth in Section
2.02(a) hereof.
"Notice of Interest Rate Conversion" shall have the meaning set
forth in Section 2.02(b) hereof.
"Obligations" shall mean all amounts owing to any Agent or any
Lender pursuant to the terms of this Agreement or any other Loan Document,
including without limitation, all Advances (including all principal and
interest payments due thereunder), Letter of Credit Obligations, Fees,
expenses, indemnification and reimbursement payments, indebtedness,
liabilities, and obligations of the Company and its Subsidiaries,
covenants and duties of the Company to the Lenders and the Agents of every
kind, nature and description, direct or indirect, absolute or contingent,
due or not due, in contract or tort, liquidated or unliquidated, arising
under this Agreement or under the other Loan Documents, by operation of
law or otherwise, now existing or hereafter arising or whether or not for
the payment of money or the performance or the nonperformance of any act,
including, but not limited to, all debts, liabilities and obligations
owing by the Company to others which the Lenders may have obtained by
assignment or otherwise, and all damages which the Company may owe to the
Lenders and the Agents by reason of any breach by the Company of any
representation, warranty, covenant, agreement or other provision of this
Agreement or of any other Loan Document.
13
"Original Credit Agreement" shall have the meaning set forth in the
first recital.
"Other Claims" shall have the meaning set forth in Section 5.08
hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Person" shall mean an individual, corporation, partnership, trust,
limited liability company or unincorporated organization, a government or
any agency or political subdivision thereof.
"Plan" shall mean any employee benefit plan, program, arrangement,
practice or contract, maintained by or on behalf of the Company or an
ERISA Affiliate, which provides benefits or compensation to or on behalf
of employees or former employees, whether formal or informal, whether or
not written, including but not limited to the following types of plans:
(i) Executive Arrangements - any bonus, incentive compensation,
stock option, deferred compensation, commission, severance, "golden
parachute", "rabbi trust", or other executive compensation plan, program,
contract, arrangement or practice;
(ii) ERISA Plans - any "employee benefit plan" as defined in ERISA,
including, but not limited to, any defined benefit pension plan, profit
sharing plan, money purchase pension plan, savings or thrift plan, stock
bonus plan, employee stock ownership plan, Multiemployer Plan, or any
plan, fund, program, arrangement or practice providing for medical
(including post-retirement medical), hospitalization, accident, sickness,
disability, or life insurance benefits;
(iii) Other Employee Fringe Benefits - any stock purchase, vacation,
scholarship, day care, prepaid legal services, severance pay or other
fringe benefit plan, program, arrangement, contract or practice.
"Preferred Stock" shall mean (i) 5,000 shares of 8% cumulative
convertible preferred stock, no par value, of the Company, (ii) up to
2,500 shares of 8% cumulative convertible preferred stock, no par value,
of the Company to be issued to BNP Paribas or any Affiliate thereof and
(iii) such other preferred stock issued by the Company in form and
substance satisfactory to the Required Lenders.
"Pro Rata Share" shall mean, for any Lender, the proportion
expressed as a percentage equal to (1) the sum of such Lender's portion of
the Total Commitments (including, without duplication, any portion of the
Total Commitments in which such Lender has purchased a participation and
excluding, without duplication, any portion of the Total Commitments in
which such Lender has sold a participation), divided by (2) the sum of the
Total Commitments.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time, and any
regulation successor thereto.
14
"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" shall mean Lenders whose combined Pro Rata Shares
of the Total Commitments are at least sixty-six and two-thirds percent (66
2/3%) of the Total Commitments.
"Revolving Loan Commitments" shall mean, for any Lender at any time,
the revolving credit facility severally established by such Lender in
favor of the Company pursuant to Section 2.01, as limited to the
Subcommitment Amount established pursuant to Section 2.01(d), as the same
may be increased pursuant to Section 2.01(b), as the same may be increased
or decreased from time to time as a result of any reduction thereof
pursuant to Section 2.12, any assignment thereof pursuant to Section
10.08, or any amendment thereof pursuant to Section 10.02.
"Revolving Loans" shall mean, collectively, the loans made to the
Company by the Lenders pursuant to Section 2.01.
"Revolving Note" shall mean a promissory note of the Company payable
to the order of any Lender in substantially the form of Exhibit A hereto,
evidencing the maximum aggregate principal indebtedness of the Company to
such Lender under such Lender's Revolving Loan Commitment, either as
originally executed or as it may be from time to time supplemented,
modified, amended, renewed or extended.
"Security Documents" shall mean, collectively, the Mortgages, the
Assignment of Leases, the Company Pledge Agreement, the Company Security
Agreement, the Company Trademark Security Agreement, the Guarantor Pledge
Agreement, the Guarantor Security Agreement, the Guarantor Trademark
Security Agreement, all UCC financing statements and fixture filings
naming the Company or any of its Subsidiaries as debtor and the
Administrative Agent as secured party, all stock certificates evidencing
shares of stock pledged to the Administrative Agent, together with undated
stock powers or other appropriate instruments of transfer executed in
blank, and all filings in the U.S. Patent and Trademark Office which are
required to be made under the Loan Documents.
"Senior Debt" shall mean, at any time, Total Debt minus the
aggregate principal amount of all Subordinated Debt.
"Senior Debt Coverage Ratio" shall mean, as of any date of
determination with respect to the Company, the ratio of (a) Senior Debt as
of such date of determination to (b) Annualized EBITDA measured as at the
Fiscal Quarter ending on such date of determination, or if such date of
determination is not the last day of any Fiscal Quarter, then ending
immediately prior to such date of determination.
"Senior Subordinated Debt" shall mean the senior Subordinated Debt
in respect of the 12% Senior Subordinated Notes issued pursuant to the
Senior Subordinated Note Purchase Agreement.
15
"Senior Subordinated Note Purchase Agreement" shall mean that
certain Senior Subordinated Note Purchase Agreement, dated as of October
31, 1997, between the Company and the Guarantors and the Investors listed
therein, as amended by that certain Amendment No. 1 to Senior Subordinated
Note Purchase Agreement dated as of November 14, 1997, as further amended
by that certain Amendment No. 2 to Senior Subordinated Note Purchase
Agreement, dated as of June 30, 1998, as further amended by that certain
Amendment No. 3 to Senior Subordinated Note Purchase Agreement, dated as
of May 4, 1999, as further amended by that certain Amendment No. 4 to
Senior Subordinated Note Purchase Agreement, dated as of January 14, 2000,
as further amended by that certain Amendment No. 5 to Senior Subordinated
Note Purchase Agreement, dated as of May 12, 2000, as further amended by
that certain Amendment No. 6 to Senior Subordinated Note Purchase
Agreement, dated as of December 5, 2000, as further amended by that
certain Amendment No. 7 to Senior Subordinated Note Purchase Agreement,
dated as of the Closing Date, and as hereafter amended and in effect from
time to time (subject, in the case of any amendment or modification
entered into after the date hereof, to the consent of the Required Lenders
to the extent required by Section 6.14).
"Stock" shall mean (a) with respect to any Person that is a
corporation, any and all shares, interests or equivalents in capital stock
(whether voting or nonvoting, and whether common or preferred) of such
corporation, and (b) with respect to any Person that is not a corporation,
any and all partnership, membership, limited liability company or other
equity interests of such Person; and in each case, any and all warrants,
rights, or options to purchase any of the foregoing.
"Subordinated Debt" shall mean all Indebtedness of the Company and
each of its Subsidiaries subordinated to all obligations of the Company or
such Subsidiary, as the case may be, arising under this Agreement and the
other Loan Documents to which it is a party, including but not limited to
the Senior Subordinated Debt.
"Subordinated Notes" shall mean a promissory note of the Company
payable to the order of the investors signatory to the Senior Subordinated
Note Purchase Agreement, evidencing the maximum aggregate principal
indebtedness of the Company to such investor, either as originally
executed or as it may be from time to time supplemented, modified,
amended, renewed or extended.
"Subsidiary" of any Person shall mean any corporation, partnership
or other Person of which a majority of all the outstanding capital stock
(including director's qualifying shares) or other securities or ownership
interests having ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions is, at the time as
of which any such determination is being made, directly or indirectly
owned by such Person, or by one or more of the Subsidiaries of such
Person, and which corporation, partnership or other Person is consolidated
with such Person for financial reporting purposes. Unless otherwise
specified, "Subsidiaries" and "Subsidiary" shall mean the Subsidiaries and
a Subsidiary, respectively, of the Company.
16
"SunTrust" shall have the meaning set forth in the first paragraph
of this Agreement.
"Supplemental Documents" shall mean the supplements to the following
documents: the Guaranty Agreement, the Contribution Agreement, the
Guarantor Security Agreement, the Guarantor Pledge Agreement and the
Guarantor Trademark Security Agreement, as such supplements are more
specifically described and shown in each respective document.
"Swing Line" shall have the meaning assigned to such term in Section
2.03(a).
"Swing Line Advance" shall mean a Borrowing pursuant to Section 2.03
consisting of a Swing Line Loan made by the Swing Line Lender to the
Company at an interest rate equal to the Swing Line Rate.
"Swing Line Borrowing" shall mean a Borrowing consisting or to
consist of a Swing Line Advance.
"Swing Line Borrowing Notice" shall mean the notice given by the
Company to the Swing Line Lender requesting a Swing Line Advance as
provided in Section 2.03(b).
"Swing Line Lender" shall have the meaning set forth in the first
paragraph of this Agreement.
"Swing Line Loans" shall mean, collectively, the loans made to the
Company by the Swing Line Lender pursuant to Section 2.03.
"Swing Line Note" shall mean the promissory note evidencing the
Swing Line Loans substantially in the form of Exhibit B and duly completed
in accordance with the terms hereof.
"Swing Line Subcommitment" shall mean the commitment of the Swing
Line Lender to make Swing Line Loans in an aggregate principal amount at
any time outstanding not to exceed $2,000,000.
"Swing Line Rate" shall have the meaning set forth in Section
2.17(c).
"Swing Line Rate Advance" shall mean an Advance made or outstanding
as a Swing Line Loan bearing interest based on the Swing Line Rate as
provided in Section 2.17(c).
"Swing Line Rate Quote" shall mean an offer by the Swing Line Lender
to make a Swing Line Loan to the Company at the Swing Line Rate specified
therein for the interest period to be applicable to the Swing Line Loan as
specified therein, pursuant to Section 2.03(b).
"Syndication Agent" shall have the meaning set forth in the first
paragraph of this Agreement.
17
"Tax" shall mean, with respect to any person or entity, any federal,
state or foreign tax, assessment, customs duties, or other governmental
charge, levy or assessment (including any withholding tax) upon such
person or entity or upon such person's or entity's assets, revenues,
income or profits, other than income and franchise taxes imposed upon any
Lender by the jurisdictions (or any political subdivision thereof) in
which such Lender has its principal office or office from which its
Advances are made, or in which such Lender is incorporated.
"Total Debt" shall mean, at any time, all then currently outstanding
obligations, liabilities and indebtedness of the Company and its
Subsidiaries on a consolidated basis of the types described in the
definition of INDEBTEDNESS (other than as described in subsection (x)
thereof), including, but not limited to, all Revolving Loans, Swing Line
Loans and Letter of Credit Obligations under the Loan Documents.
"Total Debt Coverage Ratio" shall mean, as of any date of
determination with respect to the Company, the ratio of (a) Total Debt as
of such date of determination to (b) Annualized EBITDA measured as at the
Fiscal Quarter ending on such date of determination, or if such date of
determination is not the last day of any Fiscal Quarter, then ending
immediately prior to such date of determination
"Total Commitments" shall mean, at any time, the sum of the
Revolving Loan Commitments, including the Letter of Credit Subcommitment
of each of the Lenders, and in the case of the Swing Line Lender, the
Swing Line Subcommitment.
"United States" or "U.S." means the United States of America, its
fifty (50) States and the District of Columbia.
"U.S. Dollar" "Dollar" and "$" shall mean lawful money of the United
States of America.
SECTION 1.02 Calculations; Accounting Terms. Calculations of all
financial data herein shall be on a consolidated basis for the Company and all
Subsidiaries; and all accounting terms used herein shall, unless otherwise
expressly indicated, be in reference to the Company and its Subsidiaries, if
any, on a consolidated basis, which may be accounted for in accordance with the
equity investment method (to the extent such method is in accordance with GAAP),
and shall have the meanings ascribed thereto under and be interpreted in
accordance with GAAP. All calculations and determinations under Article VII
shall be made in accordance with accounting principles consistent with those
followed in the preparation of the annual or interim financial statements, as
applicable, referred to in Section 5.03.
SECTION 1.03 Other Definitional Provisions.
(a) Except as otherwise specified herein, all references herein (A)
to any Person, other than the Company or any Subsidiary, shall be deemed to
include such Person's successors, transferees and assignees, (B) to the Company
or any Subsidiary, shall be deemed to include such Person's successors, (C) to
any Applicable Law specifically defined or referred to herein shall be deemed
references to such Applicable Law as the same may be amended or supplemented
from time to time, and (D) to any contract defined or referred to herein shall
18
be deemed references to such contract (and, in the case of any instrument, any
other instrument issued in substitution therefor) as the terms thereof may have
been or may be amended, supplemented, waived or otherwise modified from time to
time.
(b) When used in this Agreement, the words "herein", "hereof" and
"hereunder" and words of similar import shall refer to this Agreement as a whole
and not to any provision of this Agreement, and "Section", "Subsection",
"Schedule" and "Exhibit" shall refer to Sections and Subsections of, and
Schedules and Exhibits to, this Agreement unless otherwise specified.
(c) Whenever the context so requires, the neuter gender includes the
masculine or feminine, and the singular number includes the plural, and vice
versa.
(d) All terms defined in this Agreement shall have the defined
meanings when used in any Note or, except as otherwise expressly stated therein,
any certificate, opinion or other Loan Document.
SECTION 1.04 Captions. Article and Section captions in this Agreement are
included for convenience of reference only and shall not constitute a part of
this Agreement for any other purpose.
ARTICLE II
AMOUNT AND TERMS OF LOANS
SECTION 2.01 Revolving Loan Commitments and Revolving Notes;
Increase in Revolving Loan Commitments. (a) Subject to and upon the terms and
conditions set forth in this Agreement, (i) each of the Lenders severally
establishes until September 30, 2003 (September 30, 2003, is hereinafter
referred to as the "Commitment Termination Date") a revolving credit facility in
favor of the Company in aggregate principal at any one time outstanding not to
exceed the sum set forth opposite such Lender's name below, as the same may be
reduced from time to time pursuant to the terms hereof:
SunTrust Bank, as successor by merger to SunTrust Bank, South $20,000,000.00 33 1/3%
Florida, National Association
▇▇▇▇▇▇ Financial, Inc. $20,000,000.00 33 1/3%
BNP Paribas $20,000,000.00 33 1/3%
TOTAL: $60,000,000.00 100.00%
and (ii) each Lender agrees to purchase a participation interest in the Letters
of Credit in accordance with this Article II; provided, however, that in no
event may the aggregate principal amount of all outstanding Revolving Loans,
Swing Line Loans and Letter of Credit Obligations outstanding exceed at any time
the Total Commitments from time to time in effect. Within the limits of the
Revolving Loan Commitments, the Company may borrow, repay and reborrow under the
19
terms of this Agreement; provided, however, that (A) the aggregate principal
amount of each Borrowing shall not be less than $500,000 and shall be in
integral multiples of $100,000, (B) all of the Company's representations and
warranties are true and correct on and as of the date of each Borrowing, (C) the
Company may neither borrow nor reborrow should there exist a Default or an Event
of Default, or such would result from the Borrowing, and (D) the aggregate
outstanding amount of Advances and Letter of Credit Obligations, after giving
effect to each Borrowing and issuance of Letters of Credit, shall not exceed the
Total Commitments. At no time shall the number of Borrowings outstanding under
this Article II exceed seven; provided that, for the purpose of determining the
number of Borrowings outstanding, all Borrowings consisting of Base Rate
Advances shall be considered as one Borrowing. Borrowings under the Commitments
shall be made through simultaneous Advances by the Lenders, and the amount of
each such Borrowing shall be prorated among such Lenders based on the
percentages set forth above. All Advances by each Lender shall be evidenced by a
single Revolving Note payable to such Lender substantially in the form of
Exhibit A attached hereto. Each Revolving Note shall be dated as of the Closing
Date, shall be payable to the order of the respective Lender in a principal
amount equal to the amount set forth opposite such Lender's name above, shall
bear interest as provided for in this Agreement and shall mature on the
Commitment Termination Date or sooner should the principal and accrued interest
thereon be declared immediately due and payable as provided for herein. No
Lender shall have any obligation to advance funds in excess of an amount equal
to the percentage set forth opposite such Lender's name above multiplied by the
Total Commitments.
(b) So long as no Event of Default has occurred and is continuing,
the Company may, at any time by written notice to the Administrative Agent, who
shall promptly notify the Lenders, request that the Revolving Loan Commitments
be increased up to an amount not to exceed $75,000,000 (the "Requested
Commitment Amount"). No Lender (or any successor thereto) shall have any
obligation to increase its Revolving Loan Commitment or its other obligations
under this Agreement and the other Loan Documents, and any decision by a Lender
to increase its Revolving Loan Commitment shall be made in its sole discretion
independently from any other Lender.
(c) The Company shall have the right to obtain commitments from
existing Lenders or new banks or financial institutions in an aggregate amount
such that the existing Revolving Loan Commitments, plus the aggregate principal
amount of the new commitments by the Lenders or new banks or financial
institutions does not exceed the Requested Commitment Amount; provided, however,
that (1) the new banks or financial institutions must be acceptable to each
Agent, which acceptance will not be unreasonably withheld or delayed, and (2)
the new banks or financial institutions must become parties to this Agreement
pursuant to a joinder agreement in form and substance satisfactory to each
Agent, pursuant to which (x) they shall be granted all of the rights that
existing Lenders have under this Agreement and the other Loan Documents and (y)
they shall assume the same liabilities and obligations that the existing Lenders
have under this Agreement.
(d) Anything to the contrary contained herein notwithstanding, from
the period commencing with the Closing Date until such time that the Company has
received an aggregate amount of $5,000,000 (excluding the net cash proceeds of
any equity offering of Preferred Stock to BNP Paribas or any Affiliate thereof)
in any combination of (i) additional debt pursuant to Section 2.01(c) above or
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(ii) the net cash proceeds of an equity offering of Preferred Stock or common
stock of the Company, the Company shall not be allowed to borrow more than
$57,500,000 (the "Subcommitment Amount") under the Revolving Loan Commitment and
the Lenders shall have no obligation to make Advances in excess of the
Subcommitment Amount. In the event that the Company is unable to obtain an
additional debt placement or equity infusion, at the written request of the
Company and with the consent of Lenders whose combined Pro Rata Shares of the
Total Commitments are at least seventy-five percent (75%) of the Total
Commitments, the Subcommitment Amount shall be terminated and the Company shall
be able to borrow up to the entire Revolving Loan Commitment.
SECTION 2.02 Method of Borrowing Under the Commitments.
(a) The Company shall give the Administrative Agent written or
telephonic notice (promptly confirmed in writing) of any requested Borrowing
under the Commitments, substantially in the form of Exhibit C attached hereto (a
"Notice of Borrowing"), specifying (i) the amount of the Borrowing, (ii) the
date the proposed Borrowing is to be made (which shall be a Business Day) and
(iii) that no Default or Event of Default exists, or would exist with notice or
the passing of time. Each Notice of Borrowing shall be given to the
Administrative Agent (x) in the case of Base Rate Advances, not later than 11:00
a.m. (New York, New York time) one Business Day prior to the date of such
requested Borrowing or (y) in the case of LIBOR Advances, not later than 11:00
a.m. (New York, New York time) at least three Business Days prior to the date
such requested Borrowing is to be made (which shall be a Business Day). The
Administrative Agent shall be entitled to rely on any telephonic Notice of
Borrowing which it believes in good faith to have been given by an Executive
Officer of the Company, and any Advances made by the Lenders based on such
telephonic notice shall, when deposited by the Administrative Agent to the
Company's Account No. 0128320009032 at SunTrust, be Advances for all purposes
hereunder.
(b) Whenever the Company desires to convert all or a portion of an
outstanding Borrowing consisting of Base Rate Advances into one or more
Borrowings consisting of LIBOR Advances, or to continue a Borrowing consisting
of LIBOR Advances for a new Interest Period, it shall give the Administrative
Agent written notice or telephonic notice (promptly confirmed in writing) at
least three Business Days before the date of such conversion, specifying each
such Borrowing to be converted into or continued as LIBOR Advances. Such notice
(a "Notice of Interest Rate Conversion") shall be given prior to 11:00 a.m. (New
York, New York time) on the date specified. Each such Notice of Interest Rate
Conversion shall be irrevocable and shall specify the aggregate principal amount
of the Advances to be converted or continued, the date of such conversion or
continuation and the Interest Period applicable thereto. If, upon the expiration
of any Interest Period in respect of any Borrowing, the Company shall have
failed to deliver the Notice of Interest Rate Conversion, the Company shall be
deemed to have elected to convert or continue such Borrowing to a Borrowing
consisting of Base Rate Advances. So long as any Default or Event of Default
shall have occurred and be continuing, no Borrowing may be converted into or
continued as (upon expiration of the current Interest Period) LIBOR Advances
unless the Administrative Agent and each of the Lenders shall have otherwise
consented in writing. No conversion of any Borrowing of LIBOR Advances shall be
permitted except on the last day of the Interest Period in respect thereof.
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(c) Upon receipt of a Notice of Borrowing or a Notice of Interest
Rate Conversion from the Company, the Administrative Agent shall notify the
Lenders by telephone, which notice shall be promptly confirmed in writing
(including by telecopier) by the Administrative Agent to such Lenders, of such
Notice of Borrowing or Notice of Interest Rate Conversion and of each such
Lender's Pro Rata Share of the requested Borrowing or Interest Rate Conversion.
Not later than 1:00 p.m. (New York, New York time) on the date specified for the
Borrowing or Interest Rate Conversion in the Notice of Borrowing or Notice of
Interest Rate Conversion and in the notice to such Lender provided by the
Administrative Agent, each Lender shall promptly make its portion of the
Borrowing available to the Administrative Agent in immediately available funds,
and the Administrative Agent shall make available to the Company the amount so
received by the Administrative Agent from the Lenders not later than 3:00 p.m.
(New York, New York time) on such date. In the event any Lender shall fail to
make any Advance available to the Administrative Agent in immediately available
funds by 1:00 p.m. (New York, New York time) on the date specified, and provided
no Default or Event of Default shall have occurred and be continuing, the
Administrative Agent may advance such Lender's portion of the Borrowing on
behalf of such Lender, in which event such Lender shall promptly reimburse the
Administrative Agent for the amount thereof plus (i) if the amount of such
Lender's Advance is reimbursed to the Administrative Agent on or prior to the
calendar day next succeeding the date of the Borrowing, interest on such amount
at the rate equal to the Federal Funds Rate, or (ii) if the amount of such
Lender's Advance is reimbursed to the Administrative Agent after the calendar
day next succeeding the day of the Borrowing, interest on such amount at the
Base Rate; provided, however, that any such reimbursement by such Lender to the
Administrative Agent shall not relieve such Lender who fails to make any Advance
as provided above from liability to the Company for such failure. The amount of
interest payable as a result of any Lender's failure to make any Advance
available shall be calculated on the basis of a year of 360 days and paid for
the actual number of days such failure has continued (including the date of
payment). If such Lender fails to reimburse the Administrative Agent as provided
in this Section 2.02(c), then the Administrative Agent shall have the right to
deduct any amounts owed to it hereunder from Advances it makes to the Company in
subsequent Borrowings made by the Company.
SECTION 2.03 Swing Line Subcommitment.
(a) Notwithstanding anything contained herein to the contrary, the
Swing Line Lender hereby establishes a subcommitment within its Revolving Loan
Commitment of up to an aggregate of $2,000,000 (the "Swing Line") to accommodate
the short term borrowing needs of the Company. Sections 3.01 and 3.02 shall
apply equally to Borrowings made through the Swing Line and Borrowings or
Interest Rate Conversions requested or made through Section 2.02. The aggregate
amount of all Borrowings under the Swing Line shall not at any time exceed the
Swing Line Subcommitment, and to the extent any Borrowing under the Swing Line
would cause such a result after giving effect thereto, the Company shall be
required to request such Borrowing under Section 2.02(a) hereof. Any Borrowing
made by the Company under the Swing Line shall be for a period not to exceed 30
days.
(b) Whenever the Company desires to make a Borrowing under the Swing
Line, it shall give the Swing Line Lender prior written or telephonic notice
(promptly confirmed in writing) of any requested Borrowing under the Swing Line
(each a "Swing Line Borrowing Notice") prior to 11:00 a.m. (New York, New York
22
time) on the date of such Borrowing. Each Swing Line Borrowing Notice shall
specify the aggregate principal amount of the Swing Line Borrowing, the date of
such Swing Line Borrowing (which shall be a Business Day) and the interest
period to be applicable thereto. The Swing Line Lender shall make available to
the Company the amount of the Borrowing requested in the Swing Line Borrowing
Notice not later than 3:00 p.m. (New York, New York time) on such date, provided
that (i) no Default or Event of Default shall have occurred and be continuing
and (ii) the aggregated principal amount of the Swing Line Borrowings, including
the requested Borrowing under such Swing Line Borrowing Notice, shall be no
greater than the Swing Line Subcommitment.
(c) The Swing Line Lender, at any time and from time to time in its
sole discretion, may, on behalf of the Company (which hereby irrevocably
authorizes and directs the Swing Line Lender to act on its behalf), give a
Notice of Revolving Borrowing to the Administrative Agent requesting the Lenders
(other than the Swing Line Lender) to make Base Rate Advance in an amount equal
to the unpaid principal amount of any Swing Line Loan. Each Lender will make the
proceeds of its Base Rate Loan included in such Borrowing available to the
Administrative Agent for the account of the Swing Line Lender in accordance with
Section 2.07, which will be used solely for the repayment of such Swing Line
Loan.
(d) If for any reason a Base Rate Advance may not be (as determined
in the sole discretion of the Administrative Agent), or is not, made in
accordance with Section 2.03(c), then each Lender (other than the Swing Line
Lender) shall purchase an undivided participating interest in such Swing Line
Loan in an amount equal to its Pro Rata Share thereof on the date that such Base
Rate Advance should have occurred. On the date of such required purchase, each
Lender shall promptly transfer, in immediately available funds, the amount of
its participating interest to the Administrative Agent for the account of the
Swing Line Lender.
(e) Each Lender's obligation to make a Revolving Loan pursuant to
Section 2.03(c) or to purchase the participating interests pursuant to Section
2.03(d) shall be absolute and unconditional and shall not be affected by any
circumstance, including without limitation (i) any setoff, counterclaim,
recoupment, defense or other right that such Lender or any other Person may have
or claim against the Swing Line Lender, the Company or any other Person for any
reason whatsoever, (ii) the existence of a Default or an Event of Default or the
termination of any Lender's Revolving Loan Commitment, (iii) the existence (or
alleged existence) of any event or condition which has had or could reasonably
be expected to have a Materially Adverse Effect, (iv) any breach of this
Agreement or any other Loan Document by the Company, the Administrative Agent or
any Lender or (v) any other circumstance, happening or event whatsoever, whether
or not similar to any of the foregoing. If such amount is not in fact made
available to the Swing Line Lender by any Lender, the Swing Line Lender shall be
entitled to recover such amount on demand from such Lender, together with
accrued interest thereon for each day from the date of demand thereof at the
Federal Funds Rate. Until such time as such Lender makes its required payment,
the Swing Line Lender shall be deemed to continue to have outstanding Swing Line
Loans in the amount of the unpaid participation for all purposes of the Loan
Documents. In addition, such Lender shall be deemed to have assigned any and all
payments made of principal and interest on its Loans and any other amounts due
to it hereunder, to the Swing Line Lender to fund the amount of such Lender's
23
participation interest in such Swing Line Loans that such Lender failed to fund
pursuant to this Section, until such amount has been purchased in full.
(f) The Company's obligation to pay the principal of, and interest
on, the Swing Line Loans shall be evidenced by the records of the Swing Line
Lender and by the Swing Line Note payable to the Swing Line Lender (or its
assignee) completed in conformity with this Agreement.
(g) The outstanding principal amount under each Swing Line Loan
shall be due and payable in full on the Commitment Termination Date.
SECTION 2.04 Letter of Credit Subcommitment. Subject to, and upon
the terms and conditions, hereof (including the limitations of Section 2.01) the
Company may request, in accordance with the provisions of this Section 2.04 and
Section 2.05, that on and after the Closing Date, the Administrative Agent issue
a Letter or Letters of Credit for the account of the Company; provided, that (i)
no Letter of Credit shall have an expiration date that is later than ten days
prior to the Commitment Termination Date; (ii) each Letter of Credit issued by
the Administrative Agent shall be in a stated amount of at least $250,000; (iii)
the Administrative Agent shall have no obligation to issue any Letter of Credit,
if, after giving effect to such issuance, the aggregate Letter of Credit
Obligations would exceed the Letter of Credit Subcommitment; and (iv) the
Administrative Agent shall have no obligation to issue any Letter of Credit, if,
after giving effect to such issuance, the sum of the outstanding Revolving
Loans, Swing Line Loans and Letter of Credit Obligations would exceed the Total
Commitments.
SECTION 2.05 Notice of Issuance of Letter of Credit; Agreement to
Issue.
(a) Whenever the Company desires the issuance of a Letter of Credit,
it shall, in addition to any application and documentation procedures required
by the Administrative Agent for the issuance of such Letter of Credit, deliver
to the Administrative Agent a written notice no later than 11:00 A.M. (New York,
New York time) at least five (5) days in advance of the proposed date of
issuance. Each such notice shall specify (i) the proposed date of issuance
(which shall be a Business Day); (ii) the face amount of the Letter of Credit;
(iii) the expiration date of the Letter of Credit; and (iv) the name and address
of the beneficiary with respect to such Letter of Credit and shall attach a
precise description of the documentation and a verbatim text of any certificate
to be presented by the beneficiary of such Letter of Credit which would require
the Administrative Agent to make payment under the Letter of Credit, provided
that the Administrative Agent may require changes in any such documents and
certificates in accordance with its customary letter of credit practices, and
provided further, that no Letter of Credit shall require payment against a
conforming draft to be made thereunder on the same Business Day that such draft
is presented if such presentation is made after 11:00 A.M. (New York, New York
time). In determining whether to pay under any Letter of Credit, the
Administrative Agent shall be responsible only to determine that the documents
and certificate required to be delivered under its Letter of Credit have been
delivered, and that they comply on their face with the requirements of the
Letter of Credit. Promptly after receiving the notice of issuance of a Letter of
Credit, the Administrative Agent shall notify each Lender of such Lender's
respective participation therein, determined in accordance with its respective
Pro Rata Share of the Revolving Loan Commitments as determined on the date of
the issuance of such Letter of Credit.
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(b) The Administrative Agent agrees, subject to the terms and
conditions set forth in this Agreement, to issue for the account of the Company,
a Letter of Credit in a face amount equal to the face amount requested under
paragraph (a) above, following its receipt of a notice and the application and
other documents required by Section 2.05(a). Immediately upon the issuance of
each Letter of Credit, each Lender shall be deemed to, and hereby agrees to,
have irrevocably purchased from the Administrative Agent a participation in such
Letter of Credit and any drawing thereunder in an amount equal to such Lender's
Pro Rata Share multiplied by the face amount of such Letter of Credit.
SECTION 2.06 Payment of Amounts drawn under Letter of Credit.
(a) In the event of any request for a drawing under any Letter of
Credit by the beneficiary thereof, the Administrative Agent shall notify the
Company and the Lenders on or before the date on which the Administrative Agent
intends to honor such drawing, and the Company shall reimburse the
Administrative Agent on the day on which such drawing is honored in an amount,
in same day funds, equal to the amount of such drawing, provided that anything
contained in this Agreement to the contrary notwithstanding, unless the Company
shall have notified the Administrative Agent prior to 11:00 A.M. (New York, New
York time) on the Business Day immediately prior to the date on which such
drawing is honored, that the Company intends to reimburse the Administrative
Agent for the amount of such drawing in funds other than the proceeds of
Revolving Loans, the Company shall be deemed to have timely given a Notice of
Borrowing to the Administrative Agent requesting Revolving Loans which are Base
Rate Advances on the date on which such drawing is honored in an amount equal to
the amount of such drawing, and the Lenders shall by 1:00 P.M. (New York, New
York time) on the date of such drawing, make Revolving Loans which are Base Rate
Advances in the amount of such drawing, the proceeds of which shall be applied
directly by the Administrative Agent to reimburse the Administrative Agent for
the amount of such drawing, provided that for the purposes solely of such
Borrowing, the conditions and precedents set forth in Sections 3.01 and 3.02
hereof shall not be applicable, and provided further that if for any reason
proceeds of the Revolving Loans are not received by the Administrative Agent on
such date in the amount equal to the amount of such drawing, the Company shall
reimburse the Administrative Agent on the Business Day immediately following the
date of such drawing in an amount, in dollars and immediately available funds,
equal to the excess of the amount of such drawing over the amount of such
Revolving Loans, if any, which are so received, plus accrued interest on the
amount at the applicable rate of interest for Base Rate Advances.
(b) Notwithstanding any provision of this Agreement to the contrary,
to the extent that any Letter of Credit or portion thereof remains outstanding
on the Commitment Termination Date, the parties hereby agree that the
beneficiary or beneficiaries thereof shall be deemed to have made a drawing of
all available amounts pursuant to such Letters of Credit on the Commitment
Termination Date, which amounts shall be reimbursed to the Administrative Agent
as set forth above.
SECTION 2.07 Payment by Lenders. In the event that the Company shall
fail to reimburse the Administrative Agent as provided in Section 2.06 by
borrowing Revolving Loans, or otherwise providing an amount equal to the amount
of any drawing honored by the Administrative Agent pursuant to any Letter of
Credit issued by it, the Administrative Agent shall promptly notify each Lender
of the unreimbursed amount of such drawing and of such Lender's respective
participation therein. Each Lender shall make available to the Administrative
Agent an amount equal to its respective participation, in dollars and in
25
immediately available funds, at the office of the Administrative Agent specified
in such notice not later than 1:00 P.M. (New York, New York time) on the
Business Day after the date notified by the Administrative Agent. In the event
that any such Lender fails to make available to the Administrative Agent the
amount of such Lender's participation in such Letter of Credit, the
Administrative Agent shall be entitled to recover such amount on demand from
such Lender together with interest on such amount at the Base Rate. The
Administrative Agent shall distribute to each other Lender which has paid all
amounts payable under this Section with respect to any Letter of Credit, such
Lender's Pro Rata Share of all payments received by the Administrative Agent
from the Company in reimbursement of drawings honored by the Administrative
Agent under such Letter of Credit when such payments are received.
SECTION 2.08 Obligations Absolute. The obligation of the Company to
reimburse the Administrative Agent for drawings made under Letters of Credit
issued for the account of the Company and the Lenders' obligation to honor their
participations purchased therein shall be unconditional and irrevocable and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances, including without limitation, the following circumstances:
(a) Any lack of validity or enforceability of any Letter of Credit;
(b) The existence of any claim, set-off, defense or other right
which the Company or any Subsidiary or Affiliate of the Company may have at any
time against a beneficiary or any transferee of any Letter of Credit (or any
Persons or entities for whom any such beneficiary or transferee may be acting),
any Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including without
limitation any underlying transaction between the Company or any of its
Subsidiaries and Affiliates and the beneficiary for which such Letter of Credit
was procured); provided that nothing in this Section shall affect the right of
the Company to seek relief against any beneficiary, transferee, Lender or any
other Person in any action or proceeding or to bring a counterclaim in any suit
involving such Persons;
(c) Any draft, demand, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect;
(d) Payment by the Administrative Agent under any Letter of Credit
against presentation of a demand, draft or certificate or other document which
does not comply with the terms of such Letter of Credit;
(e) Any other circumstance or happening whatsoever which is similar
to any of the foregoing; or
(f) the fact that a Default or an Event of Default shall have
occurred and be continuing.
26
SECTION 2.09 Indemnification; Nature of Administrative Agent's
Duties.
(a) In addition to amounts payable elsewhere provided in this
Agreement, without duplication, the Company hereby agrees to protect, indemnify,
pay and save the Administrative Agent and each Lender harmless from and against
any and all claims, demands, liabilities, damages, losses, costs, charges and
reasonable expenses (including reasonable attorney's fees and disbursements)
which the Administrative Agent or any Lender may incur or be subject to as a
consequence, direct or indirect, of (i) the issuance of any Letter of Credit for
the account of the Company, other than as a result of the gross negligence or
willful misconduct of the Administrative Agent; or (ii) the failure of the
Administrative Agent to honor a drawing under any Letter of Credit due to any
act or omission (whether rightful or wrongful) of any present or future de jure
or de facto government or governmental authority.
(b) Notwithstanding any other provision contained in this Agreement,
the Administrative Agent shall not be obligated to issue any Letter of Credit,
nor shall any Lender be obligated to purchase its participation in any Letter of
Credit to be issued hereunder, if the issuance of such Letter of Credit or
purchase of such participation shall have become unlawful or prohibited by
compliance by Administrative Agent or such Lender in good faith with any law,
governmental rule, guideline, request, order, injunction, judgment or decree
(whether or not having the force of law); provided that in the case of the
obligation of a Lender to purchase such participation, such Lender shall have
notified the Administrative Agent to such effect in writing at least ten (10)
Business Days' prior to the issuance thereof by the Administrative Agent, which
notice shall relieve the Administrative Agent of its obligation to issue such
Letter of Credit pursuant to Section 2.04 and Section 2.05 hereof.
SECTION 2.10 Prepayment of Borrowings Under the Commitments. The
Company shall have the right to prepay Borrowings under the Commitments, in
whole at any time or in part from time to time, without premium or penalty (but,
in the case of LIBOR Advances, subject to the funding indemnification provisions
of Section 2.21), provided that (i) the Company gives the Administrative Agent
prior written notice of such prepayment, specifying the date such prepayment
will occur (which shall be a Business Day), (x) in the case of any Base Rate
Advance, at least one Business Day in advance of such date or (y) in the case of
any LIBOR Advance during an Interest Period, at least three Business Days in
advance of such date, (ii) each partial prepayment shall be in an amount of at
least $500,000 and integral multiples of $100,000, (iii) prepayments shall be
applied to repay Borrowings under the Commitments in the order set forth in
Section 2.13 hereof, and (iv) such prepayments include interest accrued, on the
principal amount prepaid, to the prepayment date.
SECTION 2.11 Mandatory Prepayments.
(a) If the sum of the (i) aggregate outstanding principal amount of
the Revolving Loans, (ii) aggregate outstanding principal amount of the Swing
Line Loans, and (iii) Letter of Credit Obligations exceed at any time the Total
Commitments, as reduced pursuant to Section 2.12 or otherwise, the Company shall
immediately repay the Swing Line Loans, Revolving Loans, or Letter of Credit
Obligations by an amount equal to such excess or, with respect to Letters of
Credit, shall deliver cash collateral for all outstanding Letters of Credit
pursuant to arrangements satisfactory to the Administrative Agent. Each
27
prepayment of Revolving Loans shall be applied first to Base Rate Advances to
the full extent thereof before application to LIBOR Advances.
(b) The Company shall make a mandatory prepayment from one hundred
percent (100%) of the after-tax net cash proceeds received by the Company or any
of its Subsidiaries from any sale or other disposition by the Company or any of
its Subsidiaries of any of their assets, provided, however, that such prepayment
provision shall not apply to sales of assets in the ordinary course of business
(such assets to include motorized vehicles, including cars and trucks) or the
sale of all or parts of the Company's stand alone high pressure cylinder
business, and certain other sales to be agreed upon in writing by the Company
and the Required Lenders. Such prepayment shall be due no later than five (5)
Business Days after any sale or other disposition by the Company of any of its
assets as set forth above along with a detailed calculation showing all
deductions from gross proceeds in order to arrive at net cash proceeds.
(c) The Company shall make a mandatory prepayment from one hundred
percent (100%) of net cash proceeds of any issuance of Stock (except for Stock
issued in connection with the exercise of employee or management stock options;
provided, however, that if the net cash proceeds from the exercise of employee
or management stock options exceeds $500,000 in the aggregate during any Fiscal
Year, the Company shall be required to make a mandatory prepayment equal to such
amount that is in excess of $500,000); provided, further, the Company shall not
be required to make a mandatory prepayment as a result of any equity issuance of
Preferred Stock to BNP Paribas or any Affiliate thereof. Such prepayment shall
be made no later than the Business Day following the date of receipt by Company
of any such net cash proceeds along with a detailed calculation showing all
deductions from gross proceeds in order to arrive at net cash proceeds.
(d) Notwithstanding anything in this Agreement to the contrary, no
reduction in the Commitments shall be required hereunder as a result of any
mandatory prepayment under this Section 2.11.
SECTION 2.12 Voluntary Reduction of Commitments. Upon at least five
(5) Business Days' prior written notice (or telephonic notice promptly confirmed
in writing) to the Administrative Agent, which notice shall specify (1) the
amount by which such Commitments are to be terminated and (2) the date such
termination is to occur, the Company shall have the right, without premium or
penalty, to terminate the Commitments, in whole or in part, provided that (a)
any partial termination pursuant to this Section 2.12 shall be in an amount of
at least $5,000,000 and integral multiples of $1,000,000 and (b) any such
termination shall apply to reduce proportionately and permanently the
Commitments. If the aggregate principal amount of Advances exceeds the amount of
the Commitments as so reduced, the Company shall immediately repay Borrowings
under such Commitments by an amount equal to such excess, together with accrued
but unpaid interest on such excess.
SECTION 2.13 Allocation of Payments.
(a) All principal and interest payments and prepayments made with
respect to Advances and payments in respect of Commitment Fees shall be
allocated among all outstanding Commitments and Advances to which such payments
28
relate, proportionately based on the Lenders' Pro Rata Shares of the
Commitments.
(b) All payments and prepayments made to the Administrative Agent by
the Company shall be applied in the following order: (a) first, to the
reimbursement of any fees which are due and payable, and expenses incurred by
and then due and payable to, the Administrative Agent, in accordance with the
terms of this Agreement, in connection with the administration of the
Commitments and otherwise (to the extent any such fees are payable by the
Company pursuant to the terms of this Agreement); (b) second, to the payment of
any accrued and unpaid interest and Fees which are due and payable, pro rata to
the Lenders based upon their respective Pro Rata Shares of the Commitments; and
(c) finally, to the payment of outstanding Advances.
SECTION 2.14 Termination of Commitments. The unpaid principal
balance and all accrued and unpaid interest and fees on the Notes will be due
and payable upon the first of the following dates or events to occur: (i)
acceleration of the maturity of any Note in accordance with the remedies
contained in Section 8.02 of this Agreement; or (ii) upon the expiration of the
Commitments on the Commitment Termination Date.
SECTION 2.15 Use of Proceeds. The proceeds of each Borrowing under
the Commitments will be used by the Company to refinance existing debt and
thereafter to provide for the working capital and general corporate needs of the
Company.
SECTION 2.16 Fees.
(a) On the Closing Date and on each anniversary thereof, the Company
shall pay to the Administrative Agent the Administrative Agent Fee, which fee
shall be nonrefundable when paid.
(b) The Company shall pay to the Administrative Agent, for the
account of and distribution of the respective Pro Rata Share to each Lender
(subject to the last sentence hereof), a commitment fee (the "Commitment Fee")
for the period commencing on the Closing Date to and including the Commitment
Termination Date, computed at a rate equal to the Applicable Commitment Fee
Percentage multiplied by the average daily unused portion of the Revolving Loan
Commitments of the Lenders, such fee being payable quarterly in arrears on the
last day of each calendar quarter, commencing on September 30, 2001, and on the
Commitment Termination Date. The Commitment Fee will be calculated on the basis
of a 360-day year for the actual number of days elapsed. For purposes of
determining the Commitment Fee, the outstandings under the Swing Line
Subcommitment shall not be included as a part of the outstandings under the
Revolving Loan Commitments.
(c) The Company shall pay, quarterly in arrears on the last day of
each calendar quarter, commencing on September 30, 2001, and on the Commitment
Termination Date, (i) to the Administrative Agent, for the account of and
distribution of the respective Pro Rata Share to each Lender, a letter of credit
fee equal to the Applicable Margin for LIBOR Advances multiplied by the average
daily aggregate Letter of Credit Obligations, and (ii) to the Administrative
Agent, for its own account, a letter of credit fronting fee equal to one-quarter
of one percent (0.25%) multiplied by the stated face amount of such Letter of
Credit (collectively, the "Letter of Credit Fee").
29
(d) The Company hereby authorizes the Administrative Agent to
withdraw an amount equal to the fees which are due and payable under clauses
(a), (b) or (c) above from any of its accounts with the Administrative Agent if
not paid on the due date for such fees. The Administrative Agent shall give the
Company notice of any such withdrawals, provided, however, that failure by the
Administrative Agent to give the Company notice shall not prevent the
Administrative Agent from making any such withdrawals under this Section.
SECTION 2.17 Interest.
(a) For Borrowings other than those made under the Swing Line, the
Company shall be entitled to select between the following two options to
establish the rate of interest at which the unpaid principal amount of the
Revolving Notes shall accrue:
(i) Base Rate Advances - interest shall accrue at the Base Rate
plus the Applicable Margin; or
(ii) LIBOR Advances - interest shall accrue at LIBOR plus the
Applicable Margin.
(b) All computations of interest accruing at the Base Rate shall be
made on the basis of a year of 365 days for the actual number of days (including
the first day but excluding the last day) occurring in the period for which the
Base Rate is payable (to the extent computed on the basis of days elapsed), and
all computations of Fees and interest accruing at rates other than the Base Rate
hereunder and under the Revolving 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). Interest on Base
Rate Loans shall be calculated based on the Base Rate from and including the
date of such Loan to but excluding the date of the repayment or conversion
thereof. Interest on LIBOR Loans shall be calculated on the basis of a year of
360 days for the actual number of days elapsed as to each Interest Period from
and including the first day thereof to but excluding the last day thereof. Each
determination by the Administrative Agent of the Base Rate, LIBOR, the rates
applicable after an Event of Default or any Fee hereunder shall be made in good
faith and, except for manifest error, shall be final, conclusive and binding for
all purposes. Interest on the Revolving Notes for Borrowings other than those
made under the Swing Line shall be payable to the Lenders as follows:
(i) Base Rate Advances -- on the last day of every quarter in
arrears; and
(ii) LIBOR Advances -- at the expiration of each Interest Period.
(c) For Borrowings made under the Swing Line, the rate of interest
at which the unpaid principal shall accrue on the Swing Line Note shall be equal
to the Base Rate in effect on each day such Swing Line Loan is outstanding.
Interest on each Swing Line Loan shall be payable on the maturity date of such
Swing Line Loan, which shall be the last day of the Interest Period applicable
thereto, and on the Commitment Termination Date (the "Swing Line Rate").
30
(d) The Company hereby authorizes the Administrative Agent to
withdraw an amount equal to the interest which is due and payable under clauses
(a), (b) or (c) above and under Section 2.23 from any of its accounts with the
Administrative Agent if not paid on the due date for such interest. The
Administrative Agent shall give the Company notice of any such withdrawals,
provided, however, that failure by the Administrative Agent to give the Company
notice shall not prevent the Administrative Agent from making any such
withdrawals under this Section.
SECTION 2.18 Interest Periods.
(a) In connection with the making or continuation of, or conversion
into, each Borrowing of LIBOR Advances, the Company shall select an Interest
Period to be applicable to such LIBOR Advance, which Interest Period shall be
either a 1, 2, or 3 month period.
(b) Notwithstanding paragraph (a) above:
(i) The initial Interest Period for any Borrowing of LIBOR
Advances shall commence on the date of such Borrowing (including the
date of any conversion from a Borrowing consisting of Base Rate
Advances) and each Interest Period occurring thereafter in respect of a
continuation of such Borrowing shall commence on the day on which the
immediately preceding Interest Period expires;
(ii) If any Interest Period would otherwise expire on a day which
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; provided, that if any Interest Period in
respect of LIBOR Advances 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 next
preceding Business Day;
(iii) Any Interest Period in respect of LIBOR Advances which
begins on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period shall, subject to
part (iv) below, expire on the last Business Day of such calendar month;
(iv) No Interest Period in respect of LIBOR Advances shall extend
beyond any date upon which any prepayment is required to be made on the
Borrowings, unless the aggregate principal amount of Borrowings that are
not LIBOR Advances, or that have Interest Periods which will expire on
or before the date of the respective payment or prepayment, is equal to
or in excess of the amount of any such principal payments or prepayments
to be made; and
(v) No Interest Period with respect to the LIBOR Advances shall
extend beyond the Commitment Termination Date.
SECTION 2.19 Increased Costs.
(a) If, by reason of (x) after the date hereof, the introduction of
or any change (including, without limitation, any change by way of imposition or
increase of reserve requirements) in or in the interpretation of any law or
31
regulation, or (y) the compliance with any guideline or request from any central
bank or other governmental authority or quasi-governmental authority exercising
control over banks or financial institutions generally (whether or not having
the force of law):
(i) any Lender (or its applicable Lending Office) shall be
subject to any tax, duty or other charge with respect to its LIBOR
Advances or its obligation to make LIBOR Advances, or the basis of
taxation of payments to any Lender of the principal of or interest on
its LIBOR Advances or its obligation to make LIBOR Advances shall have
changed (except for changes in the tax on the overall net income of, or
any franchise tax on, such Lender or its applicable Lending Office
imposed by the jurisdiction in which such Lender's principal executive
office or applicable Lending Office is located); or
(ii) any reserve (including, without limitation, any imposed by
the Board of Governors of the Federal Reserve System), special deposit
or similar requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender's applicable Lending
Office shall be imposed or deemed applicable or any other condition
affecting its LIBOR Advances or its obligation to make LIBOR Advances
shall be imposed on any Lender or its applicable Lending Office or the
London interbank market;
and as a result thereof there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining LIBOR Advances (except to
the extent already included in the determination of LIBOR for LIBOR Advances),
or there shall be a reduction in the amount received or receivable by such
Lender or its applicable Lending Office, then the Company shall from time to
time, upon written notice from and demand by such Lender on the Company (with a
copy of such notice and demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender within five Business Days
after the date of such notice and demand, additional amounts sufficient to
indemnify such Lender against such increased cost. A certificate as to the
amount of such increased cost, submitted to the Company and the Administrative
Agent by such Lender in good faith and accompanied by a statement prepared by
such Lender describing in reasonable detail the basis for and calculation of
such increased cost, shall, except for manifest error, be final, conclusive and
binding for all purposes. In the event that the Company shall pay the increased
costs accrued through the date of payment as required under this Section
2.19(a), plus any funding losses as described in Section 2.21, then the Company
shall have the right to convert the relevant LIBOR Advance to a Base Rate
Advance, as provided in Section 2.02, and the Administrative Agent and each of
the Lenders shall be deemed to have given their consent thereto, as required
thereunder.
(b) If any Lender shall advise the Administrative Agent that at any
time, because of the circumstances described in clauses (x) or (y) in Subsection
2.19(a) or any other circumstances beyond such Lender's reasonable control
arising after the date of this Agreement affecting such Lender or the London
interbank market or the United States secondary certificate of deposit market or
such Lender's position in such markets, LIBOR, as determined by the
Administrative Agent, will not adequately and fairly reflect the cost to such
Lender of funding its LIBOR Advances, then, and in any such event:
32
(i) the Administrative Agent shall forthwith give notice (by
telephone confirmed in writing) to the Company and to the other Lenders
of such advice;
(ii) the Company's right to request and such Lender's obligation
to make or permit portions of the Loans to remain outstanding past the
last day of the then current Interest Periods as LIBOR Advances shall be
immediately suspended; and
(iii) such Lender shall make a Loan as part of the requested
Borrowing of LIBOR Advances, as the case may be, as a Base Rate Advance,
which such Base Rate Advance shall, for all other purposes, be
considered part of such Borrowing.
SECTION 2.20 Capital Adequacy. If, after the date of this Agreement,
any Lender shall have determined that the adoption of any applicable law, rule
or regulation regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by such Lender with any request or
directive regarding capital adequacy not currently in effect or fully applicable
as of the Closing Date (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital as a consequence of its
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's policies with respect to capital adequacy) by an amount deemed by
such Lender to be material, then, from time to time, promptly upon demand by
such Lender (with a copy to the Administrative Agent), the Company shall pay
such Lender such additional amount or amounts as will compensate such Lender for
such reduction. A certificate of any Lender claiming compensation under this
Section 2.20 and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive absent manifest error. In determining any such
amount, such Lender may use any reasonable averaging and attribution methods.
Each Lender will promptly notify the Company of any such adoption, change or
compliance of which it has knowledge which will entitle such Lender to
compensation pursuant to this Section, but the failure to give such notice shall
not affect such Lender's right to such compensation provided such Lender gives
such notice within 90 days after an officer of such Lender having responsibility
for the administration of this Agreement shall have received actual notice of
such adoption, change or compliance.
SECTION 2.21 Funding Losses. The Company shall compensate each
Lender, upon its written request to the Company (which request shall set forth
the basis for requesting such amounts in reasonable detail and which request
shall be made in good faith and, absent manifest error, shall be final,
conclusive and binding upon all of the parties hereto), for all losses, expenses
and liabilities (including, without limitation, any interest paid by such Lender
to lenders of funds borrowed by it to make or carry its LIBOR Advances, in
either case to the extent not recoverable by such Lender in connection with a
re-employment of such funds and including loss of anticipated profits, which the
Lender may sustain): (i) if for any reason (other than a default by such Lender)
a borrowing of, or conversion to or continuation of, LIBOR Advances to the
Company does not occur on the date specified therefor in a Notice of Borrowing
or Notice of Interest Rate Conversion (whether or not withdrawn), (ii) if any
repayment (including mandatory prepayments and any conversions) of any LIBOR
33
Advances by the Company occurs on a date which is not the last day of an
Interest Period applicable thereto, or (iii) if, for any reason, the Company
defaults in its obligation to repay its LIBOR Advances when required by the
terms of this Agreement.
SECTION 2.22 Making of Payments.
(a) The Fees and all payments of principal of, or interest on, the
Notes, and payments in respect of the Letters of Credit, shall be made in
immediately available funds free and clear of any defenses, set-offs,
counterclaims or withholdings or deductions for taxes to the Administrative
Agent at its principal office in New York, New York, for the accounts of the
respective Lenders. All such payments shall be made not later than 1:00 p.m.
(New York, New York time) and funds received after that hour shall be deemed to
have been received by the Administrative Agent on the next Business Day.
Payments to the Administrative Agent shall, as to the Company, constitute
payment to the applicable Lenders hereunder, other than Swing Line Loans.
(b) Subject to Subsection 2.18(b)(ii), whenever any payment to be
made hereunder or under any Revolving Note or the Swing Line Note shall be
stated to be due on a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day and, with respect to
payments of principal, interest thereon shall be payable at the applicable rate
during such extension.
(c) On the Business Day that a payment is received or deemed to have
been received hereunder, the Administrative Agent shall remit in immediately
available funds to each Lender its share, based on the percentages set forth in
Section 2.01, of all payments received by the Administrative Agent on the
Revolving Notes.
SECTION 2.23 Default Rate of Interest. Upon the occurrence and
during the continuance of an Event of Default, to the extent permitted by law,
the principal amount of all outstanding Swingline Loans and Revolving Loans and
all other unpaid amounts, including but not limited to Letter of Credit Fees,
hereunder shall, on such date and thereafter, bear interest at the then
applicable interest rate plus an additional two percent (2.0%) per annum until
payment in full, provided, that, for any LIBOR Advance, at the end of the
applicable Interest Period, interest shall accrue at the Base Rate plus the
Applicable Margin plus two percent (2.0%) per annum. Interest accruing pursuant
to this Section 2.23 will be due and payable upon demand.
SECTION 2.24 Proration of Payments. If any Lender shall obtain any
payment or other recovery (whether voluntary, involuntary, through exercise of
any right of set-off or otherwise) after the occurrence and during the
continuance of an Event of Default on account of the principal of or interest on
any Revolving Note or any fees in respect of this Agreement in excess of its Pro
Rata Share of payments and other recoveries obtained by all the Lenders on
account of the principal of and interest on the Revolving Notes then held by
them or any fees due to them in respect of this Agreement, such Lender shall
notify the Administrative Agent thereof and forthwith purchase from the other
Lenders such participation in the Revolving Notes held by them or in such fees
owed to them as shall be necessary to cause such purchasing Lender to share the
excess payment or other recovery ratably with each of them; provided, however,
34
that if all or any portion of the excess payment or other recovery is thereafter
recovered from such purchasing Lender, the purchase from such Lender shall be
rescinded and the purchase price restored by each selling Lender to the extent
of such recovery, but without interest, unless the purchasing Lender is required
to pay interest on the amount so recovered, in which case each selling Lender
shall pay its Pro Rata Share of such interest. After the occurrence and during
the continuance of an Event of Default, disproportionate payments of interest
shall be shared by the purchase of separate participations in unpaid interest
obligations, disproportionate payments of fees shall be shared by the purchase
of separate participations in unpaid fee obligations, and disproportionate
payments of principal shall be shared by the purchase of separate participations
in unpaid principal obligations. The Company agrees that any Lender so
purchasing a participation from another Lender pursuant to this Section 2.24
may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such participation as fully as
if such Lender were the direct creditor of the Company in the amount of such
participation. Each Lender shall give the Administrative Agent notice within
five (5) days of any payments or other recoveries described above which it
obtains.
SECTION 2.25 Lenders' Obligations Several. The obligation of each
Lender to make any Advance is several, and not joint or joint and several, and
is not conditioned upon the performance by all other Lenders of their
obligations to make Advances.
SECTION 2.26 Payments Free of Taxes.
(a) Any and all payments by the Company hereunder or under the Notes
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, in the case of each Lender, taxes
imposed on or measured by its net income, net profits, and franchise taxes (all
such excluded net income taxes, taxes on net profits and franchise taxes,
collectively referred to as the "Excluded Taxes"; all such non-excluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
collectively referred to in this Section 2.26 as "Taxes"). If the Company shall
be required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under any Note to any Lender, (x) 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 such Lender on the Gross-up Amount payable under this Section 2.26(a))
such Lender receives an amount equal to the sum it would have received had no
such deductions been made, (y) the Company shall make such deductions, and (z)
the Company shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.
(b) The Company will indemnify each Lender for the full amount of
Taxes (together with any Taxes or Excluded Taxes owed by such Lender applicable
to the Gross-up Amount payable under clause (x) of Section 2.26(a) or on the
indemnification payments made by the Company under this Section 2.26(b), 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 such Lender for any loss, cost, expense or liability incurred as a
consequence of any such Taxes. Payment pursuant to such indemnification shall be
made within ten (10) days from the date such Lender makes written demand
therefor. Within thirty (30) days after the date of the Company's payment of
35
Taxes, the Company will furnish to the relevant Lender, at its appropriate
Lending Office, the original or a certified copy of a receipt evidencing payment
thereof. In the event a Lender or the Administrative Agent receives a refund of,
or credit with respect to, any Taxes or Excluded Taxes paid by the Company
pursuant to Section 2.26(a) or this Section 2.26(b), such Lender or the
Administrative Agent shall pay the amount of such refund or credit to the
Company within thirty (30) days of receipt of such refund or application of such
credit.
(c) Each Lender that is not a "United States Person" (as defined in
the Internal Revenue Code of 1986, as amended) hereby agrees that:
(A) it shall, prior to the time it becomes a Lender
hereunder, deliver to the Company and the Administrative Agent:
(1) for each Lending Office located in the United
States, three (3) accurate and complete signed originals of
Internal Revenue Service Form W-8ECI or any successor thereto
("Form W-8ECI"), and/or
(2) for each Lending Office located outside the
United States, three (3) accurate and complete signed originals
of Internal Revenue Service Form W-8BEN or any successor thereto
("Form W-8BEN");
in each case indicating and establishing that such Lender, on the
date of delivery thereof, is entitled to receive payments of
principal, interest and fees for the account of such Lending
Office under this Agreement and the Notes are free from
withholding of any United States Federal income tax; provided,
that if the Form W-8ECI or Form W-8BEN, as the case may be,
supplied by a Lender fails to establish a complete exemption from
United States withholding tax as of the date such Lender becomes
a Lender, such Lender shall, within 15 days after a written
request from the Company or the Administrative Agent, deliver to
the Company and the Administrative Agent the forms or other
documents necessary to establish a complete exemption from United
States withholding tax as of such date;
(B) if at any time such Lender changes its Lending Office or
selects an additional Lending Office, it shall, at the same time or
reasonably promptly thereafter (but only to the extent the forms
previously delivered by it hereunder are no longer effective or do
not meet the requirements of Section 2.26(c)(A)) deliver to the
Company and the Administrative Agent in replacement for the forms
previously delivered by it hereunder:
(1) for such changed or additional applicable
Lending Office located in the United States of America, three (3)
accurate and complete signed originals of Form W-8ECI; or
(2) otherwise, three (3) accurate and complete
signed originals of Form W-8BEN;
36
in each case indicating and establishing that such Lender is on the
date of delivery thereof entitled to receive payments of principal,
interest and fees for the account of such changed or additional
Lending Office under this Agreement and the Notes are free from
withholding of any United States Federal income tax.
(d) In addition to the documents to be furnished pursuant to Section
2.26(c), each Lender shall, promptly upon the reasonable written request of the
Administrative Agent to that effect, deliver to the Company and the
Administrative Agent such other accurate and complete forms or similar
documentation as such Lender is legally able to provide and as may be required
from time to time by any applicable law, treaty, rule or regulation of any
jurisdiction in order to establish such Lender's tax status for withholding
purposes or as may otherwise be appropriate to eliminate or minimize any Taxes
on payments under this Agreement and the Notes.
(e) Each Lender shall use reasonable efforts to avoid or minimize
any amounts which might otherwise be payable by the Company pursuant to this
Section 2.26, except to the extent that a Lender determines that such efforts
would be disadvantageous to such Lender, as reasonably determined by such Lender
and which determination, if made in good faith, shall be binding and conclusive
on all parties hereto.
(f) Without prejudice to the survival of any other agreement of the
Company hereunder, the agreements and obligations of the Company and the Lenders
contained in this Section 2.26 shall survive the termination of this Agreement
and the payment in full of the principal of, premium, if any, interest, and fees
hereunder and under the Notes.
SECTION 2.27 Interest Rate Not Ascertainable, etc. In the event that
the Administrative Agent, in the case of LIBOR, shall have determined (which
determination shall be made in good faith and, absent manifest error, shall be
final, conclusive and binding upon all parties) that on any date for determining
LIBOR for any Interest Period, by reason of any changes arising after the date
of this Agreement affecting the London interbank market or the Administrative
Agent's position in such market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in the
definition of LIBOR then, and in any such event, the Administrative Agent shall
forthwith give notice (by telephone confirmed in writing) to the Company and to
the Lenders of such determination and a summary of the basis for such
determination. Until the Administrative Agent notifies the Company that the
circumstances giving rise to the suspension described herein no longer exist,
the obligations of the Lenders to make, or permit portions of the Advances to
remain outstanding past the last day of the then current Interest Periods as,
LIBOR Advances shall be suspended, and such affected Advances shall bear the
same interest as Base Rate Advances.
SECTION 2.28 Illegality.
(a) In the event that any Lender shall have determined (which
determination shall be made in good faith and, absent manifest error, shall be
final, conclusive and binding upon all parties) at any time that the making or
continuance of any LIBOR Advance has become unlawful by compliance by such
Lender in good faith with any applicable law, governmental rule, regulation,
guideline or order (whether or not having the force of law and whether or not
failure to comply therewith would be unlawful), then, in any such event, the
37
Lender shall give prompt notice (by telephone confirmed in writing) to the
Company and to the Administrative Agent of such determination and a summary of
the basis for such determination (which notice the Administrative Agent shall
promptly transmit to the other Lenders).
(b) Upon the giving of the notice to the Company referred to in
subsection (a) above, (i) the Company's right to request and such Lender's
obligation to make LIBOR Advances shall be immediately suspended, and such
Lender shall make an Advance as part of the requested Borrowing of LIBOR
Advances as a Base Rate Advance, and (ii) if the affected LIBOR Advance or
Advances are then outstanding, the Company shall immediately, or if permitted by
applicable law, no later than the date permitted thereby, upon at least one
Business Day's written notice to the Administrative Agent and the affected
Lender, convert each such Advance into an Advance or Advances to a Base Rate
Advance with an Interest Period ending on the date on which the Interest Period
applicable to the affected LIBOR Advances expires, provided that if more than
one Lender is affected at any time, then all affected Lenders must be treated
the same pursuant to this Subsection 2.28(b).
ARTICLE III
CONDITIONS TO BORROWINGS
The obligation of each Lender to make an Advance to the Company and
the obligation of the Administrative Agent to issue Letters of Credit hereunder
is subject to the satisfaction of the following conditions:
SECTION 3.01 Conditions Precedent to Initial Advances. At the time
of the making by each Lender of its initial Advance hereunder, unless otherwise
waived or consented to by the Required Lenders,
(a) subject to Section 3.03, all obligations of the Company to each
Agent or any Lender incurred prior thereto (including, without limitation, the
Company's obligation to reimburse the fees and disbursements of counsel to the
Administrative Agent in accordance with this Agreement), together with the Fees,
shall have been paid in full;
(b) the Administrative Agent shall have received the following, each
dated as of the Closing Date, if applicable, in form and substance satisfactory
to the Lenders and (except for the Notes) in sufficient copies for each Lender:
(i) A duly executed original of this Agreement.
(ii) A duly completed and executed original of a Revolving Note
payable to the order of each Lender in the principal amount of such
Lender's Commitment.
(iii) A duly completed and executed original of the Swing Line
Note payable to the order of the Swing Line Lender in the principal
amount of $2,000,000.
38
(iv) A duly executed original of the amendment to the Guaranty
Agreement and the amendment to the Contribution Agreement.
(v) A duly executed original of the Environmental Indemnity
Agreement.
(vi) A duly executed original of an assignment of all material
contracts with customers of the Company and its Subsidiaries;
(vii) A duly executed original of the Company Security Agreement
and the Guarantor Security Agreement, together (a) with such UCC
financing statements and UCC amendments recorded in such jurisdictions
as the Required Lenders deem necessary or desirable to perfect the
security interests granted thereunder and under the Company Pledge
Agreement, the Guarantor Pledge Agreement, the Company Trademark
Security Agreement, and the Guarantor Trademark Security Agreement and
(b) a duly executed landlord waiver with respect to all Collateral of
the Company located at ▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇.
(viii) Lien searches in all relevant jurisdictions listing all
effective financing statements which name the Company or any of its
Subsidiaries as debtor, together with copies of such other financing
statements (none of which shall cover the Collateral purported to be
covered by the Company Security Agreement, the Guarantor Security
Agreement, the Company Pledge Agreement, the Guarantor Pledge Agreement,
the Company Trademark Security Agreement or the Guarantor Trademark
Security Agreement), other than financing statements in favor of the
Administrative Agent.
(ix) A duly executed original of the amendment to Company Pledge
Agreement and the amendment to Guarantor Pledge Agreement, together with
stock certificates evidencing the shares of stock of all Subsidiaries of
the Company pledged to the Administrative Agent thereunder and an
undated stock power for each such stock certificate, executed in blank
by the pledgor of such stock.
(x) A duly executed original of the amendments to Company
Trademark Security Agreement and the Guarantor Trademark Security
Agreement, together with such filings in the United States Patent and
Trademark Office as the Required Lenders deem necessary or desirable to
perfect the security interests granted under the Company Trademark
Security Agreement and the Guarantor Trademark Security Agreement.
(xi) Duly executed originals of any Mortgages and Assignments of
Leases to be recorded in the real estate records of the jurisdiction in
which the Mortgaged Property related thereto is located, together with
such fixture filings and amendments to existing fixture filings recorded
in such jurisdictions as the Required Lenders deem necessary or
desirable to perfect the security interests granted thereunder, and
endorsements to the existing title insurance policies for such Mortgage
or Assignment of Leases showing that the Administrative Agent has a
valid first priority Lien with respect to such Mortgaged Property
subject to no encumbrances other than such Mortgage or such Assignment
of Leases, and Liens permitted pursuant to Section 6.01 hereof.
39
(xii) Evidence satisfactory to the Required Lenders that all
other actions necessary or desirable to perfect and protect the security
interests created by the Security Documents have been taken.
(xiii) Certificates of insurance issued by the Company's
insurers, describing in reasonable detail the insurance maintained by
the Company and its Subsidiaries, together with appropriate evidence
showing that the Administrative Agent has been named as loss payee or
additional insured, as its interest may appear, on all insurance
policies insuring property of the Company and its Subsidiaries.
(xiv) Certificates signed by the Chief Executive Officer or the
Chief Financial Officer of each of the Company and the Guarantors as to
the solvency of such Company or Guarantor.
(xv) A duly executed original of the Closing Certificate, in the
form attached hereto as Exhibit F.
(xvi) Copies of the organizational papers of each of the Company
and the Subsidiaries, certified as true and correct by the Secretary of
State of the State in which the Company or such Subsidiary is
incorporated, and certificates from the Secretaries of State of the
States in which the Company or such Subsidiary is incorporated and of
each state in which the Company or such Subsidiary is legally required
to qualify to transact business as a foreign corporation, certifying the
Company's or Subsidiaries' good standing as a corporation in such
States.
(xvii) Copies of the bylaws of each of the Company and the
Guarantors of resolutions of the Board of Directors of each of the
Company and the Guarantors approving this Agreement, the Notes, the
Borrowings hereunder, the Security Documents and all other Loan
Documents to which the Company or such Guarantor is a party and of all
documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to this Agreement, the Notes, the
Security Documents and all other Loan Documents to which the Company or
such Guarantor is a party, in each case certified as true and correct by
the Secretary or an Assistant Secretary of the Company or such
Guarantor.
(xviii) Copies of the June 30, 2001 audit, which such audit
shall be unqualified, the scope of which shall be in accordance with
GAAP, and shall state that such financial statements present fairly in
all material respects the financial condition as at the end of such
Fiscal Year, and the results of operations and statements of cash flows
of the Consolidated Companies for such Fiscal Year in accordance with
GAAP and that the examination by such accountants in connection with
such financial statements has been made in accordance with generally
accepted auditing standards.
(xix) A favorable written opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Frome
▇▇▇▇▇▇▇▇▇▇ & Wolosky LLP, counsel for the Company and the Guarantors,
substantially in the form of Exhibit G attached hereto, and covering
40
such additional matters relating to the transactions contemplated hereby
as the Required Lenders may reasonably request, addressed to each Agent
and the Lenders.
(xx) Certified copies of all consents, approvals,
authorizations, registrations or filings required to be made or obtained
by the Company or the Guarantors in connection with the transactions
contemplated hereby and by the other Loan Documents
(c) Since June 30, 2001, there shall have been no change which has
had or could reasonably be expected to have a Materially Adverse Effect;
(d) Evidence of the executed Amendment No. 7 to Senior Subordinated
Note Purchase Agreement, together with evidence that all conditions precedent to
the effectiveness of Amendment No. 7 to Senior Subordinated Note Purchase
Agreement have been contemporaneously satisfied or waived, in form and substance
satisfactory to the Lenders;
(e) All corporate and other proceedings taken or to be taken in
connection with the transactions contemplated hereby and all Loan Documents and
other documents incident thereto or delivered in connection therewith shall be
satisfactory in form and substance to each Lender;
(f) The Company and its Subsidiaries shall have a Consolidated Net
Worth of at least $32,490,000;
(g) The Total Debt Coverage Ratio of the Company and its
Subsidiaries shall be no more than 4.50:1:00; provided, however, that
realization of the costs and charges taken by the Company for the Fiscal Quarter
ending June 30, 2001 in the amount of $7,600,000.00 shall not be considered in
the calculation of the Total Debt Coverage Ratio; provided, further, for
purposes of determining the Total Debt Coverage Ratio of the Company and its
Subsidiaries as of the Closing Date, Annualized EBITDA shall be the product of
EBITDA for the fiscal quarter ending on June 30, 2001 multiplied by four; and
(h) The Senior Debt Coverage Ratio shall be less than 2.75:1.00;
provided, however, that realization of the costs and charges taken by the
Company for the Fiscal Quarter ending June 30, 2001 in the amount of
$7,600,000.00 shall not be considered in the calculation of Senior Debt Coverage
Ratio; provided, further, for purposes of determining the Senior Debt Coverage
Ratio of the Company and its Subsidiaries as of the Closing Date, Annualized
EBITDA shall be the product of EBITDA for the fiscal quarter ending on June 30,
2001 multiplied by four.
SECTION 3.02 Conditions Precedent to Each Advance and Letters of
Credit. At the time of the making by the Lenders of each Advance hereunder
(including the initial Advances) and the issuance of all Letters of Credit
(before as well as after giving effect to such Advances and the proposed use of
the proceeds thereof and the issuance of Letters of Credit), the following
statements shall be true:
(a) The representations and warranties contained in Article IV
hereof are true and correct in all material respects on and as of the date of
such Borrowing or the issuance of such Letters of Credit as though made on and
as of such date, except insofar as such representations and warranties speak
41
only as of a prior date or reflect transactions and events after the Closing
Date, as permitted by the Loan Documents;
(b) No Default or Event of Default exists or would result from such
Borrowing or from the application of the proceeds therefrom;
(c) Since the date of the most recent consolidated financial
statements of the Company described in Section 4.14 or delivered to the Lenders
pursuant to Section 5.02, nothing shall have occured which has had or could
reasonably be expected to have a Materially Adverse Effect;
(d) There shall be no action or proceeding instituted or pending
before any court or other governmental authority or, to the knowledge of the
Company, threatened (i) which reasonably could be expected to have a Materially
Adverse Effect, or (ii) seeking to prohibit or restrict the ownership or
operation of any portion of the business or assets of the Company or any of its
Subsidiaries, or to compel the Company or any of its Subsidiaries to dispose of
or hold separate all or any portion of its businesses or assets, where such
portion or portions of such business(es) or assets, as the case may be,
constitute a material portion of the total businesses or assets of the Company
or its Subsidiaries;
(e) The Advances to be made and the use of proceeds or the issuance
of such Letters of Credit thereof shall not contravene, violate or conflict
with, or involve the Administrative Agent or any Lender in a violation of, any
Applicable Law;
(f) each Notice of Borrowing given by the Company in accordance with
Section 2.02(a) hereof or issuance of a Letter of Credit and the acceptance by
the Company of the proceeds of any Borrowing shall constitute a representation
and warranty by the Company, made as of the time of the making of such Borrowing
or the issuance of such Letter of Credit that the conditions specified in
Section 3.02(a) have been fulfilled as of such time unless a notice to the
contrary specifically captioned "Disclosure Statement" is received by each of
the Lenders from the Company prior to 5:00 p.m. (New York, New York time) on the
Business Day immediately preceding the date of the making of such Borrowing. To
the extent that the Required Lenders agree to make such Borrowing after receipt
of a Disclosure Statement in accordance with the preceding sentence, the
representations and warranties pursuant to the preceding sentence will be deemed
made as modified by the contents of such Disclosure Statement and repeated, as
so modified, as at the time of the making of such Borrowing. Any such
modification shall be effective only for the occasion on which the Lenders elect
to make an Advance on such Borrowing, and unless expressly agreed by the
Required Lenders in writing to the contrary in accordance with Section 10.02,
shall not be deemed a waiver or modification of any condition to the making of
any future Borrowing.
SECTION 3.03 Effect of Amendment and Restatement. Upon the
effectiveness of this Agreement pursuant to Section 3.01, from and after the
Closing Date: (a) the terms and conditions of the Original Credit Agreement
shall be amended as set forth herein and, as so amended, shall be restated in
their entirety, but only with respect to the rights, duties and obligations
among Company, the Lenders and the Administrative Agent accruing from and after
the Closing Date; (b) the New Lenders shall be deemed to have become Lenders
hereunder and under all other Loan Documents, and the Lenders party to the
42
Original Credit Agreement (the "Original Lenders") shall be deemed to have
assigned, and the New Lenders shall be deemed to have accepted assignment of, a
portion of the "Loans" and a portion of the participation in "Letters of Credit"
and "Swing Line Loans" outstanding under the Original Credit Agreement such that
after giving effect thereto, all "Loans" and all participations in "Letters of
Credit" and "Swing Line Loans" outstanding under the Original Credit Agreement
and now outstanding under this Agreement are held by the Lenders in amounts
equal to the Lenders' Pro Rata Shares of the respective Commitments, (c) this
Agreement shall not in any way release or impair the rights, duties, Obligations
or Liens created pursuant to the Original Credit Agreement or any other Loan
Document (as defined therein) or affect the relative priorities thereof, in each
case to the extent in force and effect thereunder as of the Closing Date and
except as modified hereby or by documents, instruments and agreements executed
and delivered in connection herewith, and all of such rights, duties,
Obligations and Liens are assumed, ratified and affirmed by Company; (d) all
indemnification obligations of the Company under the Original Credit Agreement
and any other Loan Documents (as defined therein) shall survive the execution
and delivery of this Agreement and shall continue in full force and effect for
the benefit of the Original Lenders, the Agent, and any other Person indemnified
under the Original Credit Agreement or any other Loan Document (as defined
therein) at any time prior to the Closing Date, (e) the Obligations incurred
under the Original Credit Agreement shall, to the extent outstanding on the
Closing Date, continue outstanding under this Agreement and shall not be deemed
to be paid, released, discharged or otherwise satisfied by the execution of this
Agreement, and this Agreement shall not constitute a refinancing, substitution
or novation of such Obligations or any of the other rights, duties and
obligations of the parties hereunder; (f) the execution, delivery and
effectiveness of this Agreement shall not operate as a waiver of any right,
power or remedy of the Original Lenders or the Agent (as defined therein) under
the Original Credit Agreement, nor constitute a waiver of any covenant,
agreement or obligation under the Original Credit Agreement, except to the
extent that any such covenant, agreement or obligation is no longer set forth
herein or is modified hereby; (g) any and all references to the Original Credit
Agreement in each and every Collateral Document and all other Loan Documents
shall, without further action of the parties, be deemed a reference to the
Original Credit Agreement, as amended and restated by this Agreement, and as
this Agreement shall be further amended, restated, supplemented or otherwise
modified from time to time.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Company and the Subsidiaries represent and warrant as follows:
SECTION 4.01 Status of Company; Status of Subsidiaries. The Company
and each Subsidiary that is a corporation are duly organized, validly existing
and in good standing under the laws of the jurisdictions of their respective
incorporation and have the corporate power and authority to own their respective
property and assets and to transact the businesses in which they respectively
are engaged or presently propose to engage and are duly qualified and in good
standing as foreign corporations in all states where failure to be so qualified
and in good standing could have a Materially Adverse Effect. Each Subsidiary
43
that is a partnership or limited liability company is duly constituted or
organized, as the case may be, existing and in good standing under the laws of
the jurisdiction of its constitution and has all requisite power, authority and
legal right to own its property and assets and to transact the businesses in
which it is engaged or presently proposes to engage and is duly qualified and in
good standing as a foreign partnership or foreign limited liability company, as
the case may be, wherever failure to be so qualified and in good standing could
have a Materially Adverse Effect. The Company and each of its Subsidiaries have
the power to own their respective properties and to carry on their respective
businesses as now being conducted. The Company is adequately capitalized for the
purpose of conducting its business, was not formed solely for the purpose of
acting as agent for, or as an instrumentality of, any Subsidiary.
SECTION 4.02 Power and Authority. Each of the Company and the
Guarantors has the corporate or organizational power, as the case may be, and
has taken all necessary corporate action or other organizational action, as the
case may be, (including, without limitation, any consent of stockholders or
members, as the case may be, required by law or by its certificate of
incorporation, articles of organization, bylaws or operating agreement, as the
case may be) to authorize it, to execute, deliver and carry out the terms and
provisions of and to incur its obligations under this Agreement, the Notes, the
Security Documents and the other Loan Documents to which it is a party. This
Agreement, the Notes, the Security Documents and the other Loan Documents have
been duly authorized, executed and delivered by the Company and the Guarantors
party thereto.
SECTION 4.03 Compliance with Other Instruments. The execution,
delivery and performance by the Company and any Guarantors party thereto, as the
case may be, of this Agreement, the Notes, the Security Documents and the other
Loan Documents to which it is a party, (a) will not contravene any provision of
Applicable Law, rule, regulation, judgment, order or ruling, (b) will not
conflict with, be inconsistent with, or result in any breach of any of the
terms, covenants, conditions or provisions of, or constitute a default under, or
result in the creation or imposition of any Lien upon any of the property or
assets of the Company or any of its Subsidiaries pursuant to the terms of any
indenture, mortgage, deed to secure debt, deed of trust, or any other material
agreement or instrument to which the Company or any of its Subsidiaries is a
signatory or by which it is bound or to which it may be subject, (c) will not
violate any provision of the certificate of incorporation (or equivalent
thereof) or bylaws (or equivalent thereof) of the Company or any corporate
Subsidiary of the Company or the certificate of partnership or other document
governing the constitution or conduct of affairs of any Subsidiary of the
Company that is not a corporation, (d) will not require any Governmental
Approval and (e) will not result in the creation of any Lien upon the assets or
properties of the Company and its Subsidiaries except as contemplated by the
Security Documents. Neither the Company nor any of its Subsidiaries is a party
to, or otherwise subject to any provision contained in, any instrument
evidencing Indebtedness of the Company or any of its Subsidiaries, any agreement
relating thereto or any other contract or agreement (including its charter)
which limits the amount of, or otherwise imposes restrictions on the incurring
of, Indebtedness of the type to be evidenced by the Notes, other than the Senior
Subordinated Debt.
SECTION 4.04 Enforceable Obligations. This Agreement, the Notes, the
Security Documents and the other Loan Documents constitute the legal, valid and
binding obligation of the Company and the Guarantors party thereto, enforceable
44
in accordance with their terms, except as the enforceability thereof may be
limited by Bankruptcy Law and by general principles of equity.
SECTION 4.05 Governmental Authorizations. The Company and its
Subsidiaries are in good standing with respect to all governmental
authorizations, consents, approvals, orders, licenses and other actions required
by any governmental or non-governmental authority or Person, except where the
failure to maintain such good standing will not have a Materially Adverse
Effect.
SECTION 4.06 Intellectual Property. Each of the Company and its
Subsidiaries owns or has the right to use all patents, trademarks, service
marks, trade names, copyrights, licenses and other rights, free from burdensome
restrictions, which are material for the operation of its business as presently
conducted. Nothing has come to the attention of the Company, any of its
Subsidiaries or any of their respective directors and officers to the effect
that (i) any product, process, method, substance, part or other material
presently contemplated to be sold by or employed by Company or any of its
Subsidiaries in connection with its business may infringe any patent, trademark,
service ▇▇▇▇, trade name, copyright, license or other right owned by any other
Person, (ii) there is pending or threatened any claim or litigation against or
affecting the Company or any of its Subsidiaries contesting its right to sell or
use any such product, process, method, substance, part or other material or
(iii) there is, or there is pending or proposed, any patent, invention, device,
application or principle or any statute, law, rule, regulation, standard or code
which would prevent, inhibit or render obsolete the production or sale of any
products of, or substantially reduce the projected revenues of, or otherwise
have a Materially Adverse Effect.
SECTION 4.07 Outstanding Indebtedness. Neither the Company nor any
of its Subsidiaries, on a consolidated basis, has outstanding any Indebtedness,
except as described on Schedule 4.07 hereto. There exists no default under the
provisions of any instrument evidencing or securing any Indebtedness of the
Company or any of its Subsidiaries or of any agreement otherwise relating
thereto which has had or would reasonably be expected to have a Materially
Adverse Effect.
SECTION 4.08 Insurance Coverage. All property of the Company and any
of its Subsidiaries is insured within terms reasonably acceptable to the Lenders
for the benefit of the Company or a Subsidiary of the Company in amounts deemed
adequate by the Company's management in its reasonable business judgment and not
materially less than those amounts customary in the industry in which the
Company and its Subsidiaries operate against risks usually insured against by
Persons operating businesses similar to those of the Company or its Subsidiaries
in the localities where such properties are located, and the Administrative
Agent has been named loss payee or additional insured, as its interest may
appear, on all such policies. Attached as Schedule 4.08 hereto are certificates
evidencing such insurance.
SECTION 4.09 Title to Properties. Each of the Company and its
Subsidiaries has (i) good and marketable fee simple title to its respective real
properties (other than real properties it leases from others), including such
real properties reflected in the financial statements referred to in Section
4.14, subject to no Lien of any kind except Liens permitted by Section 6.01, and
(ii) good title to all of its other respective properties and assets (other than
45
properties and assets which it leases from others), including the other
properties and assets reflected in the financial statements referred to in
Section 4.14, subject to no Lien of any kind except Liens permitted by Section
6.01. Each of the Company and its Subsidiaries enjoys peaceful and undisturbed
possession in all material leases necessary for the operation of its respective
properties and assets, none of which contains any unusual or burdensome
provisions that would adversely affect or impair the operation of such
properties and assets, and all such leases are valid and subsisting and in full
force and effect.
SECTION 4.10 No Burdensome Restrictions. Neither the Company nor any
of its Subsidiaries is a party to any contract or agreement that would result in
any burdensome restrictions that might reasonably be expected to have a
Materially Adverse Effect, including, but not limited to, any collective
bargaining agreements.
SECTION 4.11 No Material Violation of Law. Neither the Company nor
any of its Subsidiaries has any notice of any violation of any law, statute,
order, regulation or judgment entered against it by any court that may
reasonably be expected to have a Materially Adverse Effect.
SECTION 4.12 No Default Under Other Agreements. Neither the Company
nor any of its Subsidiaries is in default under any agreement or instrument
relating to any Indebtedness with an aggregate outstanding or principal amount
of $250,000 or more.
SECTION 4.13 No Equity Investments. Neither the Company nor any of
its Subsidiaries possesses investments in any equity or other long-term
investments in any person, except permitted investments allowed under Section
6.09, including any wholly-owned Subsidiaries of the Company and the
Subsidiaries.
SECTION 4.14 Financial Statements. The audited consolidated
financial statements of the Company dated June 30, 2001, and the related
consolidated statements of income (including supporting footnote disclosures),
with opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇ LLP heretofore furnished to the Lenders,
is all true and correct in all material respects and present fairly the
consolidated financial condition at the date of said financial statements and
the results of operations for the fiscal period then ending of the Company. The
Company as of such date did not have any significant liabilities, contingent or
otherwise, including liabilities for Taxes or any unusual forward or long-term
commitments which were not disclosed by or reserved against in the financial
statements referred to above or in the notes thereto, and at the present time
there are no material unrealized or anticipated losses from any unfavorable
commitments of the Company or any of its Subsidiaries. The financial statements
have been prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved. Since June 30, 2001, nothing has occurred which
has had or could reasonably be expected to have a Materially Adverse Effect.
SECTION 4.15 Litigation. There are no actions, suits, investigations
or proceedings pending or, to the knowledge of the Company or any of its
Subsidiaries, threatened against or affecting the Company or any of its
Subsidiaries or any of their properties or rights by or before any court,
arbitrator or administrative or governmental body that would have a Materially
Adverse Effect.
46
SECTION 4.16 Taxes. Each of the Company and its Subsidiaries has
filed or caused to be filed all declarations, reports and tax returns including,
in the case of the Company and each Subsidiary located in the United States, all
federal and state income tax returns which it is required by law to file, and
has paid all Taxes which are shown as being due and payable on such returns or
on any assessments made against it or any of its properties. The accruals and
reserves on the books of the Company and its Subsidiaries in respect of Taxes
are adequate in all material respects for all periods. Neither the Company nor
any of its Subsidiaries has any knowledge of any unpaid adjustment, assessment
or any penalties or interest of significance, or any basis therefor, by any
taxing authority for any period, except those being contested in good faith and
by appropriate proceedings which effectively stay the enforcement of any Lien
and the attachment of a penalty.
SECTION 4.17 Margin Regulations. No part of the proceeds of any of
the Advances will be used for any purpose which violates, or which would be
inconsistent or not in compliance with, the provisions of the applicable Margin
Regulations.
SECTION 4.18 ERISA. Except as disclosed on Schedule 4.18 attached
hereto:
(a) Identification of Plans. (1) Neither the Company nor any of its
Subsidiaries maintains or contributes to or has an obligation to contribute to,
a Plan that is an "employee pension benefit plan" as defined in Section 3(2) of
ERISA or any plan, program or arrangement that provides for deferred
compensation, (2) neither the Company nor any of its Subsidiaries nor any of
their respective ERISA Affiliates in the last five years has maintained or
contributed to, or has had an obligation to contribute to, a Plan that is
subject to Title IV of ERISA and (3) neither the Company nor any of its
Subsidiaries maintains or contributes to any Foreign Plan.
(b) Compliance. Except as could not reasonably be expected to result
in a Materially Adverse Effect, each Plan maintained by Company and any of its
Subsidiaries is by its terms and in operation, in substantial compliance with
all applicable laws, and neither the Company nor any of its Subsidiaries has
been assessed, and to the knowledge of the Company, is subject to, any tax or
penalty with respect to any Plan of the Company, its Subsidiaries, or any ERISA
Affiliate thereof, including without limitation, any tax or penalty under Title
I or Title IV of ERISA or under Chapter 43 of the Tax Code, or any tax or
penalty resulting from a loss of deduction under Sections 162, 404, or 419 of
the Tax Code.
(c) Liabilities. Neither the Company nor any of its Subsidiaries has
been assessed and to the knowledge of the Company are not subject to, any
material monetary liabilities (including withdrawal liabilities) with respect to
any Plans or Foreign Plans of such the Company, its Subsidiaries or any of their
ERISA Affiliates, including without limitation, any liabilities arising from
Titles I or IV of ERISA, other than obligations to fund benefits under an
ongoing Plan and to pay current contributions, expenses and premiums with
respect to such Plans or Foreign Plans.
(d) Funding. The Company and its Subsidiaries and, with respect to
any Plan which is subject to Title IV of ERISA, each of their respective ERISA
Affiliates, have made full and timely payment of all amounts (A) required to be
contributed under the terms of each Plan and applicable law, and (B) required to
be paid as expenses (including PBGC or other premiums) of each Plan, and no Plan
47
subject to Title IV of ERISA has an "amount of unfunded benefit liabilities" (as
defined in Section 4001 (a)(18) of ERISA), determined as if such Plan terminated
on any date on which this representation and warranty is deemed made. Neither
the Company nor any of its Subsidiaries are subject to any liabilities with
respect to post-retirement medical benefits.
(e) Prohibited Transactions. Neither the Company nor any of its
Subsidiaries has engaged in, or has any knowledge of, any non-exempt prohibited
transaction (within the meaning of Section 406 of ERISA or Section 4975 of the
Tax Code) with respect to any Plan.
(f) Qualification of Plans. A favorable determination as to the
qualification under Section 401(a) of the Tax Code has been made by the Internal
Revenue Service with respect to each Plan intended to be qualified under Section
401(a) of the Tax Code and, to the best knowledge of each of the Company and its
Subsidiaries, nothing has occurred since the date of such determination that
would adversely affect such qualification.
(g) Withdrawal. Except as could not reasonably be expected to result
in a Materially Adverse Effect, neither the Company, any of its Subsidiaries,
nor any of their respective ERISA Affiliates has:
(i) ceased operations at a facility so as to become subject to
the provisions of Section 4062(e) of ERISA,
(ii) withdrawn as a substantial employer so as to become subject
to the provisions of Section 4063 of ERISA,
(iii) ceased making contributions to any "employee pension
benefit plan" subject to the provisions of Section 4064(a) of ERISA to
which any of the Consolidated Companies or any of their respective ERISA
Affiliates made contributions,
(iv) incurred or caused to occur a "complete withdrawal" (within
the meaning of Section 4203 of ERISA) or a "partial withdrawal" (within
the meaning of Section 4205 of ERISA) from a Multiemployer Plan so as to
incur withdrawal liability under Section 4201 of ERISA (without regard to
subsequent reduction or waiver of such liability under Sections 4207 or
4208 of ERISA), or
(v) been a party to any transaction or agreement under which the
provisions of Section 4204 of ERISA were applicable and which could
reasonably be expected to result in liability for any of the Company or
its Subsidiaries.
(h) Proceedings. Except as could not reasonably be expected to
result in a Materially Adverse Effect, there are no actions, suits or claims
pending (other than routine claims for benefits) or, to the knowledge of any of
the Company or any of its Subsidiaries, which could reasonably be expected to be
asserted, against any Plan maintained for employees or the assets of any such
Plan. No civil or criminal action brought pursuant to the provisions of Title I,
Subtitle B, Part 5 of ERISA, is pending or, to the best knowledge of any of the
Company or any of its Subsidiaries, threatened against any fiduciary or any
Plan.
48
SECTION 4.19 Compliance With Environmental Laws.
(a) The Company and its Subsidiaries are not in violation of, and do
not presently have outstanding any liability under, have not been notified that
they are or may be liable under and do not have knowledge of any liability or
potential liability under any applicable Environmental Laws which violation,
liability or potential liability could reasonably be expected to have a
Materially Adverse Effect.
(b) Neither the Company nor any of its Subsidiaries has received a
written request for information under any Environmental Laws stating or
suggesting that the Company or any of its Subsidiaries has or may have liability
thereunder or written notice that any such entity has been identified as a
potentially responsible party under any Environmental Laws, or any comparable
state law, or any public health or safety or welfare law, nor has any such
entity received any written notification that any Hazardous Substance that it or
any of its respective predecessors in interest has generated, stored, treated,
handled, transported, or disposed of, has been released or is threatened to be
released at any site at which any Person intends to conduct or is conducting a
remedial investigation or other action pursuant to any Environmental Laws.
(c) Each of the Company and its Subsidiaries has obtained all
material permits, licenses or other authorizations required for the conduct of
their respective operations under all applicable Environmental and Asbestos Laws
and each such authorization is in full force and effect.
(d) Each of the Company and its Subsidiaries complies in all
material respects with all laws and regulations relating to equal employment
opportunity and employee safety in all jurisdictions in which it is presently
doing business, and Company will use its reasonable best efforts to comply, and
to cause each of its Subsidiaries to comply, with all such laws and regulations
which may be legally imposed in the future in jurisdictions in which Company or
any of its Subsidiaries may then be doing business.
SECTION 4.20 Possession of Material Patents, Trademarks, Etc. Each
of the Company and its Subsidiaries possesses all patents, trademarks, licenses,
and other intellectual property rights that are necessary in any material
respect for the ownership, maintenance and operation of its properties and
assets and they are possessed free from any burdensome restrictions. To the
Company's knowledge, there are no infringements of such patents, trademarks,
licenses, and other intellectual property rights that could have a Materially
Adverse Effect.
SECTION 4.21 Subsidiaries. Schedule 4.21 attached hereto correctly
sets forth the name of each Subsidiary of the Company, the jurisdiction of such
Subsidiary's incorporation or organization and the ownership of all issued and
outstanding capital stock of such Subsidiary. All the outstanding shares of the
capital stock or other equity interests of each such Subsidiary have been
validly issued and are fully paid and nonassessable and all such outstanding
shares, except as noted on such Schedule 4.21, are owned of record and
beneficially by the Company or a wholly-owned Subsidiary of the Company free of
any Lien or claim, except for Liens in favor of the Administrative Agent.
49
SECTION 4.22 Disclosure. Neither this Agreement, any Loan Document
nor any other document, certificate or statement furnished to the Lenders or the
Administrative Agent by or on behalf of the Company or any Guarantor in
connection herewith contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained herein
and therein not misleading, if, in either case, such fact is material to an
understanding of the financial condition, business, prospects or property of the
Company and its Subsidiaries, or the ability of the Company and its Subsidiaries
to fulfill its obligations under any Loan Documents to which it is a party.
SECTION 4.23 Projections. In the good faith judgment of the Chief
Financial Officer and Chief Executive Officer of the Company and its
Subsidiaries the projections, a copy of which are attached hereto as Exhibit J,
constitute the prospects of financial performance of the Company for the periods
indicated in such projections, absent unanticipated changed circumstances or
events, many of which are beyond the Company's control.
SECTION 4.24 Subordinated Debt. As of the Closing Date, the Company
has delivered to the Administrative Agent a complete and correct copy of the
Senior Subordinated Note Purchase Agreement and the Subordinated Notes
(including all schedules, exhibits, amendments, supplements, modifications,
assignments and all other documents delivered pursuant thereto or in connection
therewith). The Company has the corporate power and authority to incur the
Indebtedness evidenced by the Subordinated Notes. The subordination provisions
contained in the Senior Subordinated Note Purchase Agreement are enforceable
against the holders of the Subordinated Notes by Administrative Agent and
Lenders. All Obligations, including the Obligations to pay principal of and
interest on the Loans and the Letter of Credit Obligations, constitute senior
Indebtedness entitled to the benefits of the subordination provisions contained
in the Senior Subordinated Note Purchase Agreement. The principal of and
interest on the Notes, all Letter of Credit Obligations and all other
Obligations will constitute "senior debt" as that or any similar term is or may
be used in any other instrument evidencing or applicable to any other
Subordinated Debt. The Company acknowledges that the Administrative Agent and
each Lender are entering into this Agreement in reliance upon the subordination
provisions of the Subordinated Notes and this Section 4.24.
ARTICLE V
AFFIRMATIVE COVENANTS
So long as any Note shall remain unpaid or any Lender shall have any
Commitment hereunder, unless the Required Lenders shall otherwise consent in
writing:
SECTION 5.01 Use of Proceeds. The proceeds of all Borrowings will be
used by the Company as provided in Section 2.15. None of the proceeds of any
Borrowing shall be used, directly or indirectly, to purchase or carry, or to
reduce or retire or refinance any credit incurred to purchase or carry, any
"margin security" or "margin stock" (within the meaning of the regulations of
50
the Board of Governors of the Federal Reserve System) or to extend credit to
others for the purpose of purchasing or carrying any such "margin security" or
"margin stock" or for any other purpose that might deem this transaction as a
"purpose credit" (within the meaning of the regulations of the Board of
Governors of the Federal Reserve System). If requested by any Lender, the
Company will furnish to such Lender statements in conformity with the
requirements of Federal Reserve Form U-1 referred to in Regulation U.
SECTION 5.02 Interest Rate Protection. Within 90 days from the
Closing Date, the Company shall enter into and maintain until the Commitment
Termination Date an agreement providing for payments which are related to
fluctuations of interest rates by which the Company is protected against changes
in the variable rates of interest payable on its indebtedness as to a notional
amount of approximately fifty-five percent (55%) of Total Debt.
SECTION 5.03 Reporting Covenants.
(a) The Company will furnish to the Administrative Agent for
distribution to each of the Lenders:
(i) as soon as available and in any event no later than 90 days
after the end of each Fiscal Year of the Company, an audited consolidated
balance sheet of the Company and its Subsidiaries as of the close of such
Fiscal Year, and the related audited consolidated statements of income and
cash flow of the Company and its Subsidiaries for such fiscal year, all in
reasonable detail and with (1) an unqualified opinion of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ &
▇▇▇▇▇ LLP, or such other independent certified public accountant of
recognized standing selected by the Company and satisfactory to the
Required Lenders, (2) a certificate (with supporting details and
calculations of financial covenants) from the Chief Financial Officer of
the Company stating whether a Default or Event of Default exists and (3) a
copy of the auditors letter to management; provided, however, that at any
other time that the auditors issue a letter to management, the Company
shall provide such letter within 10 days after receiving such letter;
provided, further, that if an auditors letter to management is available
at closing, the Company shall provide such letter on the Closing Date;
(ii) as soon as available and in any event within 45 days after
the end of each fiscal quarter of the Company that is not the end of a
Fiscal Year, its quarterly unaudited financial statements, together with
(A) a certificate in the form of Exhibit H hereto (the "Compliance
Certificate") by the Chief Financial Officer of the Company (with
supporting details and calculations of financial covenants) stating that
(x) the financials were prepared in accordance with GAAP (subject to
customary year-end audit adjustments) and that the covenants described in
Article VII have been met and (y) whether a Default or Event of Default
exists (specifying the nature thereof and intended response) and (B) a
comparison of the quarterly unaudited financial statements to the
projections and an analysis as to the differences, if any, between the
unaudited financial statements and the projections;
(iii) as soon as available and in any event within 45 days after
the end of each month, the consolidated balance sheet and related
statement of income of the Company, which shall include the amount of
Capital Expenditures for such month; and
51
(iv) as soon as available and in any event not later than
forty-five (45) days after the end of each fiscal year of the Company,
financial projections with supporting assumptions for the following fiscal
year, in a form satisfactory to the Agents.
In each case, such financial statements, pursuant to (a)(i), (a)(ii)
and (a)(iv) above, shall include balance sheets, income statements, and
statements of cash flows for the Company.
(b) The Company will promptly furnish to each of the Lenders notice
of certain other events, including the occurrence or existence of any Default or
Event of Default, any citation for a material violation of environmental laws or
regulations, important matters relating to funding of employee benefit plans, or
such other information as any Lender or the Administrative Agent may reasonably
request.
SECTION 5.04 Maintenance of Properties. The Company shall, and shall
cause each of its Subsidiaries to, maintain, preserve, protect and keep, or
cause to be maintained, preserved, protected and kept, its properties and every
part thereof in good repair, working order and condition, and from time to time
will make or cause to be made all needful and proper repairs, renewals,
replacements, extensions, additions, betterments, and improvements thereto, so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times other than those which the failure to
maintain would, individually or in the aggregate, have no Materially Adverse
Effect; provided, however, that the Company and each Subsidiary shall not be
under any obligation to repair or replace any such properties which have become
obsolete or have become unsuitable or inadequate for the purpose for which they
are used.
SECTION 5.05 Maintenance of Insurance. The Company shall, and shall
cause each of its Subsidiaries to, (i) maintain liability and workers'
compensation insurance with financially sound and reputable insurers (or
maintain a legally sufficient, fully funded, program of self insurance against
workers' compensation liabilities), and also maintain adequate insurance on its
properties against such hazards and in at least such amounts as is customary in
the business, and (ii) name the Administrative Agent as loss payee or additional
insured, as its interest may appear, on each of such insurance policies. At the
request of any Lender, the Company will forthwith deliver an officer's
certificate specifying the material details of such insurance in effect.
SECTION 5.06 Maintenance of Books; Inspection of Property and
Records. The Company shall, and shall cause each of its Subsidiaries to, keep
proper books of record and account containing complete and accurate entries in
all material respects of all of their respective financial and business
transactions and prepare or cause to be prepared its annual statements and
reports in accordance with GAAP. The Company shall, and shall cause each of its
Subsidiaries to, permit any person designated by any Lender, including third
party auditors, to visit and inspect any of its properties, corporate books and
financial records, to make copies and take extracts therefrom, and to discuss
its accounts, affairs, and finances with the principal officers of the Company
and such Subsidiary during reasonable business hours, all at such times as the
Lenders may reasonably request and at the expense of the Company; provided,
however, that any time following the occurrence and continuance of an Event of
Default, no prior notice to the Company and such Subsidiary shall be required.
52
The Company shall, and shall cause each of its Subsidiaries to, prepare or cause
to be prepared its interim statements and reports in accordance with GAAP,
subject to usual and customary year end audit and adjustments and footnote
disclosures.
SECTION 5.07 Existence and Status. The Company shall, and shall
cause each of its Subsidiaries that is a corporation to, maintain its corporate
existence, its material rights, franchises and licenses (for the scheduled
duration thereof), its patents, trademarks, trade names, service marks and other
intellectual property rights necessary or desirable in the normal conduct of its
business, its good standing in its state of incorporation and its qualification
and good standing as a foreign corporation in all jurisdictions where its
ownership of property or its business activities cause such qualification to be
required and the failure to do so could have a Materially Adverse Effect. The
Company shall cause each Subsidiary that is not a corporation to maintain its
present form of existence, its material rights, franchises and licenses (for the
scheduled duration thereof), its patents, trademarks, trade names, service marks
and other intellectual property rights necessary or desirable in the normal
conduct of its business, its good standing in the jurisdiction of its
constitution and its qualification and good standing as a foreign entity in all
jurisdictions where its ownership of property or its business activities cause
such qualification to be required and the failure to do so could have a
Materially Adverse Effect.
SECTION 5.08 Taxes and Claims. The Company shall, and shall cause
each of its Subsidiaries to, pay and discharge (i) all Taxes prior to the date
on which penalties attach thereto, and (ii) all claims (including, without
limitation, claims for labor, materials, supplies or services) (collectively
"Other Claims") which, if unpaid, might become a Lien upon any of its property;
provided, however, that the Company and its Subsidiaries shall not be required
to pay and discharge any such Tax or Other Claim so long as the legality or
amount thereof shall be promptly contested in good faith and by appropriate
proceedings which effectively stay the enforcement of any Lien and the
attachment of a penalty and the Company or such Subsidiary, as the case may be,
shall have set aside appropriate reserves therefor in accordance with GAAP.
SECTION 5.09 Compliance with Laws, Etc. The Company shall, and shall
cause each of its Subsidiaries to, comply with all Applicable Law (including,
without limitation, the Environmental Laws and Employee Benefit Laws) and
Contractual Obligations applicable to or binding on any of them where the
failure to comply with such Applicable Law and Contractual Obligations would
reasonably be expected to have a Materially Adverse Effect.
SECTION 5.10 ERISA. The Company shall, and shall cause each of its
Subsidiaries to, deliver to each of the Lenders:
(a) Promptly after the occurrence thereof with respect to any Plan,
or any trust established thereunder, notice of (A) a "reportable event"
described in Section 4043 of ERISA and the regulations issued from time to time
thereunder (other than a "reportable event" not subject to the provisions for
30-day notice to the PBGC under such regulations), or (B) any other event which
could subject the Company or any of its Subsidiaries to any tax, penalty or
liability under Title I or Title IV of ERISA or Chapter 43 of the Tax Code, or
any tax or penalty resulting from a loss of deduction under Sections 162, 404 or
419 of the Tax Code, or any tax, penalty or liability (other than amounts that
become payable in the normal operation of any Plan) under any requirement of
53
Applicable Law applicable to any Foreign Plan, where any such taxes, penalties
or liabilities exceed or could exceed $500,000 in the aggregate;
(b) Promptly after such notice must be provided to the PBGC, or to a
Plan participant, beneficiary or alternative payee, any notice required under
Section 101(d), 302(f)(4), 303, 304, 307, 4041(a)(2) of ERISA or under Section
401(a)(29) or 412 of the Tax Code with respect to any Plan of the Company, any
of its Subsidiaries or any ERISA Affiliate thereof;
(c) Upon the request of the Administrative Agent, promptly upon the
filing thereof with the Internal Revenue Service ("IRS") or the Department of
Labor ("DOL"), a copy of IRS Form 5500 or annual report for each Plan of the
Company, any of its Subsidiaries or ERISA Affiliate thereof which is subject to
Title IV of ERISA;
(d) Upon the request of the Administrative Agent, (A) true and
complete copies of any and all documents, government reports and IRS
determination or opinion letters or rulings for any Plan of the Company or any
of its Subsidiaries from the IRS, PBGC or DOL, (B) any reports filed with the
IRS, PBGC or DOL with respect to a Plan of the Company, any of its Subsidiaries
or any ERISA Affiliate thereof, or (C) a current statement of withdrawal
liability for each Multiemployer Plan of the Company, any of its Subsidiaries or
any ERISA Affiliate thereof; and
(e) Promptly upon the Company or any of its Subsidiaries becoming
aware thereof, notice that (i) any material contributions to any Foreign Plan
have not been made by the required due date for such contribution and such
default cannot immediately be remedied, (ii) any Foreign Plan is not funded to
the extent required by the law of the jurisdiction whose law governs such
Foreign Plan based on the actuarial assumptions reasonably used at any time, or
(iii) a material change is anticipated to any Foreign Plan that could reasonably
be expected to have a Materially Adverse Effect.
SECTION 5.11 Litigation. The Company shall give prompt written
notice to each of the Lenders of (a) any judgment entered by a court, tribunal,
administrative agency or arbitration panel in which the amount of liability is
$250,000 or more in excess of insurance coverage, or in which the aggregate
amount of liability is $500,000 or more in excess of insurance coverage, and (b)
any disputes which may exist between the Company or any of its Subsidiaries and
any governmental or regulatory body, in which the amount in controversy is
$250,000 or more and which may materially and adversely affect the normal
business operations of the Company or any of its Subsidiaries or any of their
respective properties and assets. The Company shall provide each of the Lenders,
on a quarterly basis, concurrently with the delivery of the Compliance
Certificate as provided under Section 5.03(a)(ii), a report which shall set
forth each action, proceeding or claim, of which the Company or any of its
Subsidiaries has notice, which is commenced or asserted against the Company or
any of its Subsidiaries, and in which the amount claimed or the potential
liability is $250,000 or more.
SECTION 5.12 Notice of Events of Default. The Company shall deliver
to each of the Lenders within five (5) days after any Executive Officer obtains
any knowledge of any condition, event or act which creates or causes a Default
or an Event of Default, a certificate signed by an officer of the Company
specifying the nature thereof, the period of existence thereof and what action
54
the Company or such Subsidiary proposes to take with respect thereto to the
extent that such Default is subject to notice and capable of being cured.
SECTION 5.13 Stockholder Reports, etc. Contemporaneously with the
sending or filing thereof, the Company will provide to the Administrative Agent
for distribution to each of the Lenders copies of all proxy statements,
financial statements, and reports which the Company sends to its stockholders,
and copies of all regular, periodic, and special reports, and all statements
which the Company files with the Securities and Exchange Commission or any
governmental authority which may be substituted therefor, or with any national
securities exchange.
SECTION 5.14 Future Guarantors.
(a) Subject to any prohibitions or limitations as to power or
authority imposed by law applicable to any such Subsidiary, the Company shall
cause (1) each Person incorporated or otherwise organized in the United States
that hereafter becomes a Subsidiary (an "Additional Guarantor") to become a
Guarantor under the Guaranty Agreement and to create a security interest in
favor of the Lenders in all of its assets, including, to the extent owned by
such Guarantor, 100% of the stock of other Subsidiaries, to the Administrative
Agent upon the creation of such Additional Guarantor by executing and delivering
to the Administrative Agent the Supplemental Documents; and (2) each Person that
owns the stock of the Additional Guarantor to pledge and deliver such stock to
the Administrative Agent, together with a supplement to the Company Pledge
Agreement or Guarantor Pledge Agreement, as the case may be, and with stock
powers or other appropriate instruments of transfer executed by such Person in
blank.
(b) The Additional Guarantor shall also deliver to the
Administrative Agent and the Lenders, simultaneously with the Supplemental
Documents, (1) Certified Requests for Information or Copies (Form UCC-11) or
equivalent reports, showing that there are no effective financing statements
which name the Additional Guarantor as debtor and (2) an opinion rendered by
legal counsel to such Additional Guarantor and the Person required to pledge the
shares of stock of the Additional Guarantor under the Security Documents to the
Administrative Agent, addressing the types of matters set forth in Exhibit G
hereof and such other matters as the Lenders may reasonably request, addressed
to the Administrative Agent and the Lenders.
SECTION 5.15 Ownership of Guarantors. The Company and its
Subsidiaries that own Guarantors shall maintain their percentage ownership of
such Guarantors existing as of the date hereof and shall not decrease its
ownership percentage in each Additional Guarantor pursuant to Section 5.14 after
the date hereof, as such ownership exists at the time such Additional Guarantor
becomes a Guarantor hereunder.
SECTION 5.16 Landlord Waivers. The Company shall use its best
efforts to deliver to the Administrative Agent, within 90 days from the Closing
Date, duly executed landlord waivers and/or warehouseman, or bailee with respect
to all Collateral of the Company or its Subsidiaries located at leased locations
or other locations not owned by the Company in fee simple. So long as any Note
shall remain unpaid or any Lender shall have any Commitment hereunder, the
Company or any of its Subsidiaries shall deliver to the Administrative Agent a
55
duly executed landlord waiver and/or warehouseman agreement, or bailee agreement
with respect to all Collateral of the Company or its Subsidiaries located at any
newly leased locations.
SECTION 5.17 Notices to Holders of Subordinated Debt.
Contemporaneously with the sending or filing thereof, the Company will provide
to the Administrative Agent for distribution to each of the Lenders, any notices
provided to holders of Subordinated Debt.
ARTICLE VI
NEGATIVE COVENANTS
So long as any Note shall remain unpaid or any Lender shall have any
Commitment hereunder, without the written consent of the Required Lenders
(unless otherwise provided herein):
SECTION 6.01 Limitation on Liens and Security Interests. The Company
shall not, and shall not permit any of its Subsidiaries to, create, incur,
assume or suffer to exist, any Lien or other encumbrance of any kind on any of
its properties or assets, real or personal, wherever located, including assets
hereafter acquired, except
(a) Liens existing on the date hereof and described on Schedule
6.01;
(b) Liens in favor of the Administrative Agent;
(c) Liens for Taxes not yet payable or being contested in good faith
and by appropriate proceedings;
(d) deposits or pledges to secure payments of workmen's
compensation, unemployment insurance, old age pension and other social security
obligations;
(e) mechanics', carriers', workmen's, repairmen's, landlord's, or
other Liens arising in the ordinary course of business securing obligations
which are not overdue for a period longer than 60 days, or which are being
contested in good faith by appropriate proceedings;
(f) pledges or deposits to secure performance in connection with
bids, tenders, contracts (other than contracts for the payment of money) or
leases made in the ordinary course of the business of the Company or any of its
Subsidiaries;
(g) deposits to secure, or in lieu of, surety and appeal bonds to
which the Company or a Subsidiary of the Company is a party;
(h) deposits in connection with the prosecution or defense of any
claim in any court or before any administrative commission or agency;
(i) Liens arising out of judgments or awards with respect to which
the Company or a Subsidiary of the Company at the time shall in good faith be
diligently prosecuting an appeal or proceedings for review and with respect to
56
which it shall have secured a stay of execution pending such appeal or
proceedings for review; provided, however, that amount of any appeal bond or
cash collateral submitted by the Company and its Subsidiaries to prosecute an
appeal or proceedings for review shall not exceed $250,000 in the aggregate;
(j) purchase money security interests, and operating leases in the
ordinary course of business, for equipment and machinery, in each case purchased
in the ordinary course of business and to be used in the conduct of its
business, provided that any such security interest secures only the repayment of
the purchase price of such machinery or equipment, not to exceed at any time
$5,000,000 in the aggregate;
(k) Liens on fixtures in connection with existing mortgages on real
property or mortgages permitted hereunder; and (l) zoning restrictions,
easements, licenses, reservations and restrictions on the use of real property
or minor irregularities thereto that do not materially detract from the use
thereof or the assets of the Company or any of its Subsidiaries.
SECTION 6.02 Indebtedness. Create, incur, assume or suffer to exist,
or permit any of its Subsidiaries to create, incur, assume or suffer to exist,
any Indebtedness, other than:
(a) Indebtedness evidenced by this Agreement and by the Notes;
(b) Indebtedness outstanding on the date hereof which is set forth
on Schedule 4.07 hereto;
(c) secured Indebtedness to the extent permitted by clause (j) of
Section 6.01 above;
(d) unsecured current liabilities (not resulting from any borrowing)
incurred in the ordinary course of business for current purposes and not
represented by a promissory note or other evidence of indebtedness;
(e) Indebtedness related to interest rate swaps or ▇▇▇▇▇▇, or to
hedge the Company's variable interest rate exposure; or
(f) Indebtedness incurred and consented to in writing by the
Required Lenders.
SECTION 6.03 Compliance with ERISA. The Company shall not take or
fail to take, or permit any of its Subsidiaries or ERISA Affiliates to take or
fail to take, any action with respect to any Plans which are subject to Title IV
of ERISA or to continuation health care requirements for group health plans
under the Tax Code which could reasonably be expected to result in a Materially
Adverse Effect, including without limitation (a) establishing any such Plan, (b)
amending any such Plan (except where required to comply with applicable law),
(c) terminating or withdrawing from any such Plan, or (d) incurring an amount of
unfunded benefit liabilities, as defined in Section 4001(a)(18) of ERISA, or any
withdrawal liability under Title IV of ERISA with respect to any such Plan.
57
SECTION 6.04 Sale and Leaseback. The Company shall not, and shall
not permit any of its Subsidiaries to, enter into any transaction with any other
entity whereby such other entity leases assets sold or otherwise transferred to
it by the Company or such Subsidiary.
SECTION 6.05 Transactions with Affiliates. The Company shall not,
and shall not permit any of its Subsidiaries to:
(a) Enter into any transaction or series of related transactions,
whether or not in the ordinary course of business, with any affiliate of the
Company or any of its Subsidiaries (but excluding any affiliate which is the
Company or any of its wholly-owned Subsidiaries), other than on terms and
conditions substantially as favorable to the Company or such Subsidiary as would
be obtained by the Company or such Subsidiary at the time in a comparable
arm's-length transaction with a Person other than an affiliate.
(b) Convey or transfer to any other Person (including the Company or
any of its Subsidiaries) any real property, buildings, or fixtures used in the
manufacturing or production operations of the Company or any of its
Subsidiaries, or convey or transfer to the Company or any of its Subsidiaries
any other assets (excluding conveyances or transfers in the ordinary course of
business) if at the time of such conveyance or transfer any Default or Event of
Default exists or would exist as a result of such conveyance or transfer.
SECTION 6.06 Guaranties. The Company shall not, and shall not permit
any of its Subsidiaries to, create, incur, assume, guarantee, suffer to exist or
otherwise become liable on or with respect to, directly or indirectly, any
guaranties other than:
(a) endorsements of instruments for deposit or collection in the
ordinary course of business; or
(b) guarantees of Indebtedness owed by any Consolidated Company to
another Consolidated Company.
SECTION 6.07 Limitations on Payment Restrictions. Except as
otherwise permitted under the Senior Subordinated Debt, the Company shall not,
and shall not permit any of its Subsidiaries to, create or otherwise cause or
suffer to exist or become effective, any consensual encumbrance or restriction
on the ability of the Company or any of its Subsidiaries to (i) pay dividends or
make any other distributions on stock of the Company or any of its Subsidiaries,
(ii) pay any indebtedness owed to the Company or any of its Subsidiaries, or
(iii) transfer any of its property or assets to the Company or any of its
Subsidiaries except any consensual encumbrance or restriction existing under the
Loan Documents or any Senior Subordinated Debt.
SECTION 6.08 Merger; Joint Ventures; Sale of Assets. The Company
shall not, and shall not permit any of its Subsidiaries to:
(a) merge or consolidate with any other entity, except the foregoing
restrictions shall not be applicable to mergers or consolidations of (x) any
Subsidiary with any other Subsidiary which is a Guarantor so long as Guarantor
is a survivor or (y) any Subsidiary with the Company so long as the Company is
the survivor;
58
(b) purchase, lease or otherwise acquire for cash, stock or other
consideration, the stock or other equity interests of any Person or all or any
substantial portion of the assets of any Person; or
(c) enter into a partnership or joint venture with any other entity;
provided, however, that so long as no Event of Default has occurred, the Company
or any of its Subsidiaries may request that the Required Lenders consent to its
entering into a partnership or joint venture for the purposes of carrying on its
business; or
(d) sell, lease, transfer or otherwise dispose of any assets, except
that this Section 6.08 shall not prohibit any disposition of (i) any asset if on
the date such asset is sold, the Asset Value of all asset sales occurring after
the Closing Date, taking into account the Asset Value of the proposed asset
sale, would not exceed on an aggregate basis five percent (5%) of the
Consolidated Net Worth of the Company and its Subsidiaries on the Closing Date
and such sale is in the ordinary course of business, (ii) any obsolete or
retired property not used or useful in its business (such assets to include
high-pressure tanks, motorized vehicles, including cars and trucks that may be
obtained by the Company as part of the group of assets of any corporation or
other business entity the Company may acquire), (iii) the sale of all or parts
of the Company's stand alone high pressure cylinder business or (iv) certain
other sales to be agreed upon in writing by the Company and the Required
Lenders.
SECTION 6.09 Dividends; Loans, Investments, Advances.
(a) In any fiscal year of the Company, the Company shall not pay or
declare any cash dividends on any of its Capital Stock; provided however, the
Company may accrue and accumulate, but not pay, dividends on the Preferred
Stock.
(b) The Company shall not, and shall not permit any of its
Subsidiaries to, make, permit or hold any loans or advances (not including
accounts receivable) to any Person, other than:
(i) Investments in Subsidiaries existing on the Closing Date;
(ii) direct obligations of the United States or any agency
thereof, or obligations guaranteed by the United States or any agency
thereof, in each case supported by the full faith and credit of the United
States and maturing within one year from the date of creation thereof;
(iii) commercial paper maturing within one year from the date of
creation thereof rated in the highest grade by a nationally recognized
credit rating agency;
(iv) time deposits maturing within one year from the date of
creation thereof, including certificates of deposit issued by any Lender
and any office located in the United States of any bank or trust company
which is organized under the laws of the United States or any state
thereof and has total assets aggregating at least $500,000,000, including
without limitation, any such deposits in Eurodollars issued by a foreign
branch of any such bank or trust company; and
59
(v) Investments made by Plans.
SECTION 6.10 Nature of Business. The Company shall not, and shall
not permit any of its Subsidiaries to, engage in any business or businesses
other than those engaged in by the Company or such Subsidiary on the date
hereof; provided, however, that nothing herein contained shall prevent the
Company or any of its Subsidiaries (i) from expanding the location of its
business or businesses in the United States, (ii) from ceasing or omitting to
exercise any rights, licenses, permits, or franchises which in good faith in the
judgment of the Company or such Subsidiary can no longer be profitably
exercised, or (iii) from engaging in a business or businesses that are ancillary
to those engaged in by the Company or such Subsidiary on the date hereof.
SECTION 6.11 Sale of Subsidiaries. The Company shall not, and shall
not permit any of its Subsidiaries to, sell or otherwise dispose of any shares
of capital stock of or other ownership interest in any Subsidiary of the Company
(except in connection with any acquisition, merger or consolidation permitted by
Section 6.08), or permit any Subsidiary of the Company to issue any additional
shares of its capital stock or other incidents of ownership, except on a pro
rata basis to all its stockholders, partners or owners, as the case may be, and
provided that any such additional shares of capital stock or other incidents of
ownership issued to the Company, any Guarantor or Additional Guarantor are
pledged to the Administrative Agent.
SECTION 6.12 Negative Pledges. The Company shall not, and shall not
permit any of its Subsidiaries to, agree or covenant with any Person to restrict
in any way its ability to grant any Lien on its assets in favor of the Lenders,
except that this Section 6.12 shall not apply to (i) any covenants contained in
this Agreement or the Security Documents, (ii) the covenants contained in
Section 8.02 of the Senior Subordinated Note Purchase Agreement, and (iii)
covenants and agreements made in connection with Liens described in Section
6.01(j) but only if such covenant or agreement applies solely to the specific
machinery, equipment or real estate to which such Lien relates.
SECTION 6.13 Creation of Subsidiaries. Neither the Company nor any
of its Subsidiaries shall create or acquire any other Subsidiary or any other
affiliate after the Closing Date.
SECTION 6.14 Prepayments Under and Amendment of Other Agreements.
The Company shall not, and shall not permit any of its Subsidiaries to make,
without the prior written consent of the Lenders, any prepayments under any
Subordinated Debt document, except as a result of a refinancing permitted below.
With the prior written consent of the Required Lenders, the Company shall be
permitted to (i) amend or waive any material terms or conditions under any
Subordinated Debt document, and (ii) substitute or refinance any Subordinated
Debt, on a dollar for dollar basis; provided, however, the effect of such
amendment, waiver, substitution or refinancing shall not: (a) increase the
interest rate on such Subordinated Debt; (b) change the dates upon which
payments of principal or interest are due on such Subordinated Debt other than
to extend such dates; (c) change any default or event of default other than to
delete or make less restrictive any default provision therein, or add any
covenant with respect to such Subordinated Debt; (d) change the redemption or
prepayment provisions of such Subordinated Debt other than to extend the dates
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thereof or to reduce the premiums payable in connection therewith; (e) grant
security or collateral to secure payment of such Subordinated Debt; or (f)
change or amend any other term if such change or amendment would materially
increase the obligations of the obligor or confer additional material rights of
the holder of such Subordinated Debt in a manner adverse to the Company, any of
its Subsidiaries, the Administrative Agent or any Lender, and without limiting
the foregoing, may not shorten the standstill period as prescribed in such
Subordinated Debt. With respect to Capital Stock, the Company shall not, and
shall not permit any of its Subsidiaries to, without the prior written consent
of the Lenders, make any payment to purchase, redeem, retire or acquire any
Capital Stock or any option, warrant, or other right to acquire such capital
stock; provided, however, notwithstanding the foregoing, the Company shall be
permitted, with the prior written consent of the Required Lenders, to substitute
or replace Capital Stock, on a dollar for dollar basis on terms no more onerous
to the Lenders than the Capital Stock existing as of the Closing Date.
SECTION 6.15 Capital Expenditures. The Company shall not, and shall
not permit any of its Subsidiaries to, make Capital Expenditures during any
period in excess of the amount listed for such period on Annex A attached
hereto; provided, however, commencing with Fiscal Year 2003, if the actual
aggregate amount of Capital Expenditures made by the Company and its
Subsidiaries during the prior Fiscal Year (the "Current CapEx") is less than the
respective limit specified on Annex A for such Fiscal Year (the "Specified
CapEx"), then the applicable limit for the immediately succeeding Fiscal Year
shall be increased by an amount equal to the difference between the Current
CapEx and the Specified CapEx (the "Carryover Amount"). For purposes of this
Section 6.15 Capital Expenditures made by the Company in any Fiscal Year shall
be deemed to be made first with Specified CapEx for such Fiscal Year, then, from
the Carryover Amount, if any; provided, further, that notwithstanding the
foregoing the Company may make acquisitions of customer accounts as a result of
exchanges with competitors in an amount not to exceed $1,000,000 in the
aggregate per Fiscal Year; provided, further, to the extent that the entire
$1,000,000 is not used in any given Fiscal Year, such amount shall carry over
and the $1,000,000 cap on acquisitions of customer accounts for the succeeding
Fiscal Year shall be increased by such amount.
SECTION 6.16 Changes Related to Preferred Stock. Neither the Company
nor any of its Subsidiaries shall change or amend the terms of the Preferred
Stock or any agreement executed in connection therewith if the effect of such
amendment is to: (a) change any default or event of default other than to delete
or make less restrictive any default provision therein, or add any covenant with
respect to such Preferred Stock; (b) change the redemption or prepayment
provisions of such Preferred Stock other than to extend the dates thereof or to
reduce the premiums payable in connection therewith; or (c) change or amend any
other term if such change or amendment would materially increase the obligations
of the obligor or confer additional material rights of the holder of such
Preferred Stock in a manner adverse to the Company, any of its Subsidiaries, the
Administrative Agent or any Lender; provided, however, the issuance of Preferred
Stock to BNP Paribas or its Affiliates pursuant to section (ii) of the
definition of Preferred Stock will not result in a violation of this Section
6.16.
SECTION 6.17 Changes in Fiscal Year or Fiscal Quarter. The Company
shall not make any change to its accounting practices if such change would not
comply with GAAP or make any change in its Fiscal Quarters or Fiscal Year.
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ARTICLE VII
FINANCIAL COVENANTS
So long as any Note shall remain unpaid or any Lender shall have any
Commitment hereunder, without the consent of the Required Lenders:
SECTION 7.01 Senior Debt Coverage Ratio. The Company shall not
permit the Senior Debt Coverage Ratio at any time during a period specified
below to be greater than (i) 2.75 to 1.00 for the period beginning on the
Closing Date through and including December 31, 2001; (ii) 2.50 to 1.00 for the
period beginning January 1, 2002 through and including June 30, 2002; (iii) 2.25
to 1.00 for the period beginning July 1, 2002 through and including December 31,
2002; and (iv) 2.00 to 1.00 thereafter.
SECTION 7.02 Total Debt Coverage Ratio. The Company shall not permit
the Total Debt Coverage Ratio at any time during a period specified below to be
greater than (i) 4.50 to 1.00 for the period beginning on the Closing Date
through and including December 31, 2001; (ii) 4.25 to 1.00 for the period
beginning January 1, 2002 through and including June 30, 2002; (iii) 4.00 to
1.00 for the period beginning July 1, 2002 through and including September 30,
2002; (iv) 3.75 to 1.00 for the period beginning October 1, 2002 through and
including December 31, 2002; (v) 3.50 to 1.00 for the period beginning January
1, 2003 through and including March 31, 2003; (vi) 3.25 to 1.00 for the period
beginning April 1, 2003 through and including June 30, 2003; and (vii) 3.00 to
1.00 thereafter.
SECTION 7.03 Debt Service Coverage Ratio. The Company shall not
permit the Debt Service Coverage Ratio as of the last day of any fiscal quarter
of the Company to be less than (i) 1.15 to 1.00 for the period beginning on the
Closing Date through and including March 31, 2002; (ii) 1.20 to 1.00 for the
period beginning April 1, 2002 through and including June 30, 2002; (iii) 1.25
to 1.00, for the period beginning July 1, 2002 through and including September
30, 2002; and (iv) 1.30 to 1.00 thereafter.
SECTION 7.04 Minimum EBITDA. The Company shall maintain at all
times, calculated as of the last day of each Fiscal Quarter commencing with the
Fiscal Quarter beginning on July 1, 2001, Minimum EBITDA of not less than (i)
$4,699,000 for the Fiscal Quarter ending September 30, 2001, (provided, however,
EBITDA for the quarter ending September 30, 2001 shall be increased by adding
non-recurring charges associated with the amortization of remaining loan fees
and any waiver fees and any termination cost associated with the Company's
current interest rate protection agreement during such quarter in the amount of
$1,600,000.00); (ii) $4,950,000 for the Fiscal Quarter ending December 31, 2001,
(iii) $5,584,000 for the Fiscal Quarter ending March 31, 2002; (iv) $6,646,000
for the Fiscal Quarter ending June 30, 2002; (v) $7,423,000 for the Fiscal
Quarter ending on September 30, 2002; (vi) $8,069,000 for the Fiscal Quarter
ending December 31, 2002; (vii) $8,802,000 for the Fiscal Quarter ending March
31, 2003; (viii) $9,740,000 for the Fiscal Quarter ending June 30, 2003 and (ix)
$10,769,000 for the Fiscal Quarter ending September 30, 2003; provided, however,
if the Company completes an equity offering of Preferred Stock or common stock,
or a combination thereof, of the Company with net cash proceeds in excess of
$5,000,000 (excluding the net cash proceeds of any equity offering of Preferred
Stock to BNP Paribas or any Affiliate thereof), the Company shall be required to
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maintain at all times, calculated as of the last day of each Fiscal Quarter
commencing with the Fiscal Quarter beginning on July 1, 2001, Minimum EBITDA of
not less than (i) $4,699,000 for the Fiscal Quarter ending September 30, 2001,
(provided, however, EBITDA for the quarter ending September 30, 2001 shall be
increased by adding non-recurring charges associated with the amortization of
remaining loan fees and any waiver fees and any termination cost associated with
the Company's current interest rate protection agreement during such quarter in
the amount of $1,600,000.00); (ii) $4,950,000 for the Fiscal Quarter ending
December 31, 2001, (iii) $5,584,000 for the Fiscal Quarter ending March 31,
2002; (iv) $6,276,000 for the Fiscal Quarter ending June 30, 2002; (v)
$7,010,000 for the Fiscal Quarter ending on September 30, 2002; (vi) $7,621,000
for the Fiscal Quarter ending December 31, 2002; (vii) $8,313,000 for the Fiscal
Quarter ending March 31, 2003; (viii) $9,199,000 for the Fiscal Quarter ending
June 30, 2003 and (ix) $10,171,000 for the Fiscal Quarter ending September 30,
2003.
ARTICLE VIII
EVENTS OF DEFAULT AND REMEDIES
SECTION 8.01 Events of Default. Any one or more of the following
shall constitute an Event of Default hereunder:
(a) The Company shall fail to pay any principal amount owing when
due pursuant to this Agreement or the Notes; or
(b) The Company shall fail to pay any interest, fees, or any other
amounts owing pursuant to this Agreement or the Notes within three (3) Business
Days of the due date thereof; or
(c) The Company shall fail to perform or observe any covenant or
agreement contained in Section 5.04, Section 5.08 or Section 6.03, if remaining
unremedied for a period of ten (10) days after (x) an Executive Officer becomes
aware of such failure or (y) the Administrative Agent or any Lender gives notice
to the Company as provided under Section 10.03; or
(d) The Company shall fail to perform or observe any covenant or
agreement contained in Section 5.01, Section 5.02, Section 5.03, Section 5.12,
Section 5.15, Section 5.16, Article VI (other than Section 6.03) and Article
VII; or
(e) The Company shall fail to perform or observe any other covenant
or agreement set forth in this Agreement, other than those referred to in
clauses (a), (b), (c) and (d) above, and (to the extent such failure can be
remedied) such failure of performance shall not be remedied within thirty (30)
days after the earlier of the date on which (1) the Company or any Subsidiary
obtains knowledge thereof and (2) written notice thereof has been given by the
Administrative Agent to the Company; or
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(f) Any representation, warranty or statement made by or on behalf
of the Company or any Guarantor to the Administrative Agent or any Lender in
this Agreement, the Company Security Agreement, the Company Pledge Agreement,
the Company Trademark Security Agreement, the Guarantor Security Agreement, the
Guarantor Pledge Agreement, the Guarantor Trademark Security Agreement, the
Mortgage and the Assignment of Leases shall be in any material respect
incorrect, false or misleading as of the time at which such representation or
warranty was given, or any representation, warranty or statement made by or on
behalf of the Company or any Guarantor to any Agent or any Lender in any other
Loan Documents or in any financial statement, report or certificate furnished
pursuant to this Agreement shall be in any material respect incorrect, false or
misleading as of the time at which such representation, warranty or statement
was made; or
(g) The Company or any of its Subsidiaries fails to make any payment
as and when such payment is due upon any Indebtedness having an aggregate unpaid
principal balance in excess of $250,000, other than Indebtedness owing or
arising pursuant to this Agreement and the Notes, or any other default, event or
condition shall have occurred or exist with respect to any such other
Indebtedness, or under any agreement or instrument evidencing, securing or
related to such other Indebtedness, the effect of which is to cause, or to
permit the holder or owner of such Indebtedness to cause, such Indebtedness or
any portion thereof, to become due prior to its stated maturity date or prior to
its regularly scheduled dates of payment; or
(h) A default or event of default shall have occurred and be
continuing under any Subordinated Debt, including the Senior Subordinated Note
Purchase Agreement or the Preferred Stock; or
(i) The Company or any of its Subsidiaries defaults in the
observance or performance of any Material Contract; or
(j) The Company or any of its Subsidiaries makes an assignment for
the benefit of its creditors or files a voluntary petition seeking relief under
any provision of any bankruptcy, reorganization, arrangement, insolvency or
readjustment of debt, dissolution or liquidation law of any jurisdiction,
whether now or hereafter in effect; or
(k) Any involuntary petition is filed against the Company or any of
its Subsidiaries under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction,
whether now or hereafter in effect, and such petition shall remain undismissed
for a period of sixty (60) days or the Company approves, consents or acquiesces
thereto; or
(l) The Company incurs any liability or is exposed to any potential
liability under any employee benefit plan that has or would have a Materially
Adverse Effect; or
(m) Final judgment for the payment of money in excess of $250,000
(not fully covered by insurance) or otherwise having a Materially Adverse Effect
shall have been rendered against the Company or any of its Subsidiaries and the
same shall have remained unpaid, unstayed on appeal, undischarged, or
undismissed for a period of sixty (60) days, or such longer period as may be
permitted by Applicable Law, during which execution may not be made, provided no
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judgment Lien has attached or continues to attach to the assets of the Company
or such Subsidiary during such longer period; or
(n) Any Change in Control occurs; or
(o) Two of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, the President and Chief Executive
Officer of the Company, ▇▇▇ ▇▇▇▇▇▇▇, the Executive Vice President, Operations of
the Company, or ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the Chief Financial Officer of the Company
shall cease to function in such capacities and shall not be replaced with
persons of substantially equal qualifications, ability and experience within 120
days of such individuals ceasing to serve in such capacities; or
(p) Any change occurs which has had or could reasonably be expected
to have a Materially Adverse Effect.
SECTION 8.02 Remedies on Default.
(a) Upon (i) the occurrence and during the continuation of an Event
of Default (other than an Event of Default described in Section 8.01(j) or (k))
and (ii) the receipt of written instructions by the Administrative Agent from
the Required Lenders, the Administrative Agent shall (x) terminate all
obligations of the Lenders to the Company, including, without limitation, the
Commitments and all obligations to make Advances under this Agreement, and (y)
declare the Notes, including, without limitation, principal, accrued interest
and costs of collection (including, without limitation, reasonable attorneys'
fees if collected by or through an attorney at law or in bankruptcy,
receivership or other judicial proceedings) and all other Obligations
immediately due and payable, without presentment, demand, protest or any other
notice of any kind, all of which are expressly waived.
(b) Upon the occurrence of an Event of Default under Section 8.01(j)
or (k) all obligations of the Lenders to the Company, including, without
limitation, the Commitments, shall terminate automatically and the Notes,
including, without limitation, principal, accrued interest and costs of
collection (including, without limitation, reasonable attorneys' fees if
collected by or through an attorney at law or in bankruptcy, receivership or
other judicial proceedings) and all other Obligations shall be 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
the Notes as provided in (a) or (b) above, the Administrative Agent with the
written consent of the Required Lenders, may pursue any remedy available under
this Agreement, the Notes, the Security Documents or any other Loan Document, 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 Lenders under the Loan Documents
and otherwise may be exercised shall be determined by the Required Lenders.
(d) Regardless of how each Lender may treat the payments for the
purpose of its own accounting, for the purpose of computing the Company's
obligations hereunder and under the Notes, no application of the payments will
cure any Event of Default or prevent acceleration, or continued acceleration, of
amounts payable under the Loan Documents or prevent the exercise, or continued
exercise, of rights or remedies of the Lenders hereunder or under applicable
law.
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ARTICLE IX
THE AGENT
SECTION 9.01 Appointment of Administrative Agent.
(a) Each Lender irrevocably appoints SunTrust Bank as the
Administrative Agent and authorizes it to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent under this
Agreement and the other Loan Documents, together with all such actions and
powers that are reasonably incidental thereto. The Administrative 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
Administrative Agent. The Administrative 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 Administrative Agent, any such sub-agent and any
such attorney-in-fact and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.
(b) The Issuing Bank shall act on behalf of the Lenders with respect
to any Letters of Credit issued by it and the documents associated therewith
until such time and except for so long as the Administrative Agent may agree at
the request of the Required Lenders to act for the Issuing Bank with respect
thereto; provided, that the Issuing Bank shall have all the benefits and
immunities (i) provided to the Administrative Agent in this Article IX with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit issued by it or proposed to be issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as the term "Administrative Agent" as used in this
Article IX included the Issuing Bank with respect to such acts or omissions and
(ii) as additionally provided in this Agreement with respect to the Issuing
Bank.
SECTION 9.02 Nature of Duties of Administrative Agent. The
Administrative 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 Administrative 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
Administrative 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 Administrative 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 in Section 10.02), and (c) except as expressly set forth in the Loan
Documents, the Administrative Agent shall not have any duty to disclose, and
shall not be liable for the failure to disclose, any information relating to the
Company or any of its Subsidiaries that is communicated to or obtained by the
Administrative Agent or any of its Affiliates in any capacity. The
Administrative 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
66
be necessary under the circumstances as provided in Section 10.02) or in the
absence of its own gross negligence or willful misconduct. The Administrative
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
Administrative 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
Administrative Agent by the Company or any Lender, and the Administrative 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 Administrative Agent.
The Administrative Agent may consult with legal counsel (including counsel for
the Company) concerning all matters pertaining to such duties.
SECTION 9.03 Lack of Reliance on the Administrative Agent. Each of
the Lenders, the Swing Line Lender and the Issuing Bank acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each of the Lenders, the Swing Line Lender and the Issuing Bank also
acknowledges that it will, independently and without reliance upon the
Administrative 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 9.04 Certain Rights of the Administrative Agent. If the
Administrative 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 Administrative 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 Administrative 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
Administrative Agent as a result of the Administrative 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 9.05 Reliance by Administrative Agent. The Administrative
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 Administrative 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
Administrative Agent may consult with legal counsel (including counsel for the
Company), 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.
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SECTION 9.06 The Administrative Agent in its Individual Capacity.
The bank serving as the Administrative 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 Administrative Agent; and the terms "Lenders",
"Required Lenders", "holders of Notes", or any similar terms shall, unless the
context clearly otherwise indicates, include the Administrative Agent in its
individual capacity. The bank acting as the Administrative Agent and its
Affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Company or any Subsidiary or Affiliate of the Company
as if it were not the Administrative Agent hereunder.
SECTION 9.07 Successor Administrative Agent.
(a) The Administrative Agent may resign at any time by giving notice
thereof to the Lenders and the Company. Upon any such resignation, the Required
Lenders shall have the right to appoint a successor Administrative Agent,
subject to the approval by the Company provided that no Default or Event of
Default shall exist at such time. If no successor Administrative Agent shall
have been so appointed, and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of resignation, then the
retiring Administrative Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Administrative Agent, which shall be a commercial bank
organized under the laws of the United States of America or any state thereof or
a bank 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 Administrative
Agent hereunder by a successor, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations under this Agreement
and the other Loan Documents. If within 45 days after written notice is given of
the retiring Administrative Agent's resignation under this Section 9.07 no
successor Administrative Agent shall have been appointed and shall have accepted
such appointment, then on such 45th day (i) the retiring Administrative Agent's
resignation shall become effective, (ii) the retiring Administrative 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 Administrative Agent under the Loan Documents until such time as the
Required Lenders appoint a successor Administrative Agent as provided above.
After any retiring Administrative Agent's resignation hereunder, the provisions
of this Article IX shall continue in effect for the benefit of such retiring
Administrative 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
Administrative Agent.
SECTION 9.08 Authorization to Execute other Loan Documents. Each
Lender hereby authorizes the Administrative Agent to execute on behalf of all
Lenders all Loan Documents other than this Agreement.
SECTION 9.09 Indemnification. Each Lender shall, ratably in
accordance with the respective outstanding principal amount of its Advances,
indemnify and hold the Administrative Agent and its directors, officers, agents
and employees harmless against any and all liabilities, obligations, losses,
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damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including, without limitation, attorneys' fees
and disbursements) that may be imposed on, incurred by, or asserted against it
or them in any way relating to or arising out of the Loan Documents (other than
losses incurred by reason of the failure by the Company to pay the obligations
due to the Lenders hereunder or under the Revolving Notes) or any action taken
or not taken by it as Administrative Agent thereunder, except for the gross
negligence or willful misconduct of the Administrative Agent. Without limitation
of the foregoing, each Lender shall reimburse the Administrative Agent upon
demand for that Lender's ratable share of any cost or expense incurred by the
Administrative Agent in connection with the negotiation, preparation, execution,
delivery, administration, amendment, waiver, refinancing, restructuring,
reorganization (including a bankruptcy reorganization) or enforcement of the
Loan Documents, to the extent that the Company is required to pay that cost or
expense but fails to do so upon demand.
ARTICLE X
MISCELLANEOUS
SECTION 10.01 Survival. All covenants, agreements, warranties and
representations made herein, in the other Loan Documents, or in any certificates
or other documents delivered in connection with this Agreement by or on behalf
of the Company or any Guarantor shall survive the advances of money made by the
Lenders to the Company hereunder and the delivery of this Agreement and the
other Loan Documents, and all such covenants, agreements, warranties and
representations shall be binding upon and inure to the benefit of the Company,
the Guarantors, the Lenders, the Administrative Agent, and their respective
successors and assigns, whether or not so expressed, provided, however, that the
Company may not assign or transfer any of its rights under this Agreement
without the prior written consent of each of the Lenders.
SECTION 10.02 Amendments; Consents. No amendment, modification,
supplement, termination, or waiver of any provision of this Agreement or any
other Loan Document, and no consent to any departure by the Company, any
Guarantor or any Subsidiary of the Company therefrom, may in any event be
effective unless in writing signed by the Required Lenders, and then only in the
specific instance and for the specific purpose given; provided, however, that
without the consent of Lenders whose combined Pro Rata Shares of the Total
Commitments are at least seventy-five percent (75%) of the Total Commitments no
amendment, waiver or modification of Section 2.01(d) shall be effective;
provided, further, that without the approval in writing of all Lenders, no
amendment, modification, supplement, termination, waiver, or consent may be
effective:
(a) to amend or modify the principal of, reduce the rate of interest
payable on, or any fees with respect to, any Lender's Note, the Fees or the
amount of any Lender's Commitment;
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(b) to postpone any date fixed for any payment of principal of, or
any installment of interest on, any Lender's Notes or the Fees, or to extend the
term of any Lender's Commitment;
(c) to amend or modify the definitions of "Revolving Loan
Commitment" or "Required Lenders", to amend or modify the provisions of Section
10.07 or of this Section 10.02;
(d) except as otherwise allowed herein, to release any of the
Collateral pledged to the Administrative Agent for the benefit of, inter alia,
the Administrative Agent or the Lenders pursuant to the Security Documents to
secure the Obligations, if any Obligations are outstanding or any Commitment has
not been terminated;
(e) to consent to the existence of any other lien, security interest
or encumbrance on the Collateral except as otherwise permitted herein;
(f) to subordinate any of the Obligations or the Commitments to any
other indebtedness of the Company or any of its Subsidiaries; and
(g) to release any Guarantor or to consent to the termination or
modification of any Guaranty Agreement, except for (or in connection with) a
sale of Guarantor permitted hereunder.
Any amendment, modification, supplement, termination, waiver or consent effected
in accordance with this Section 10.02 shall apply equally to, and shall be
binding upon, all Lenders and the Administrative Agent.
SECTION 10.03 Notices. All notices, consents, demands and other
communications provided for hereunder, unless otherwise provided, shall be in
writing and mailed, sent by facsimile transmission or delivered to the parties
hereto addressed as follows or at such other address as shall be designated by
any party in a written notice to the other party hereto:
If to the Company:
NuCo2 Inc.
▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chief Financial Officer
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
NuCo2 Inc.
▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
70
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation No.: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Administrative Agent, the Swing Line Lender or
the Issuing Bank:
SunTrust Bank
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇.
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
King & Spalding
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: G. ▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Telecopier No.: ▇▇▇-▇▇▇-▇▇▇▇
Confirmation No.: ▇▇▇-▇▇▇-▇▇▇▇
If to any other Lender or Agent:
The address, telecopier and confirmation numbers set
forth opposite its name on the signature pages hereof.
All notices that are sent by facsimile transmission or are hand
delivered shall be deemed to be delivered upon receipt. All notices which are
mailed shall be mailed first class certified mail--return receipt requested,
postage prepaid, and shall be deemed delivered upon actual receipt or three days
after being deposited in the mail, whichever shall occur first.
The parties hereto agree that their signatures by facsimile shall be
effective and binding upon them as though executed in ink on paper, and that the
parties shall exchange original ink signatures promptly following any such
delivery by facsimile.
SECTION 10.04 Severability; Time of Essence. Every provision of this
Agreement and the other Loan Documents are intended to be severable. If any term
or provision of this Agreement or the Loan Documents, or any other document
delivered in connection herewith shall be unenforceable in any respect, the
enforceability of the remaining provisions shall not thereby be affected. Time
is of the essence of this Agreement and the other Loan Documents.
SECTION 10.05 Governing Law; Submission to Jurisdiction.
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER AND UNDER THE NOTES SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
71
GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF) OF THE STATE OF NEW YORK.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT,
THE NOTES, OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN ANY COURT OF THE STATE
OF NEW YORK OR IN ANY COURT OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE
COMPANY HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVE TRIAL BY JURY, AND THE COMPANY HEREBY IRREVOCABLY
WAIVES ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING
OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH
RESPECTIVE JURISDICTIONS.
(c) THE COMPANY IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF
ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING
OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE
COMPANY AT ITS SAID ADDRESS, SUCH SERVICE TO BECOME EFFECTIVE THIRTY (30) DAYS
AFTER SUCH MAILING.
(d) Nothing herein shall affect the right of any Agent, the Issuing
Bank, the Swing Line Lender, any Lender, any holder of a Note or the Company to
serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Company in any other jurisdiction.
(e) The Company hereby irrevocably designates, appoints and empowers
CT Corporation System, whose present address is ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, as its authorized agent to receive, for and on its
behalf and its property, service of process in the State of New York when and as
such legal actions or proceedings may be brought in the courts of the State of
New York or of the United States of America sitting in New York, and such
service of process shall be deemed complete upon the date of delivery thereof to
such agent whether or not such agent gives notice thereof to the Company, or
upon the earliest of any other date permitted by applicable law. The Company
shall furnish the consent of CT Corporation System so to act to the
Administrative Agent on or prior to the Closing Date. It is understood that a
copy of said process served on such agent will as soon as practicable be
forwarded to the Company, at its address set forth below, but its failure to
receive such copy shall not affect in any way the service of said process on
said agent as the agent of the Company. The Company irrevocably consents to the
service of process out of any of the aforementioned courts in any such action or
proceeding by the mailing of the copies thereof by certified mail, return
receipt requested, postage prepaid, to it at its address set forth herein, such
service to become effective upon the earlier of (i) the date ten (10) calendar
days after such mailing or (ii) any earlier date permitted by applicable law.
The Company agrees that it will at all times continuously maintain an agent to
receive service of process in the State of New York on behalf of itself and its
72
properties and in the event that, for any reason, the agent named above or its
successor shall no longer serve as its agent to receive service of process in
the State of New York on its behalf, it shall promptly appoint a successor so to
serve and shall advise the Agents and the Lenders thereof (and shall furnish to
the Administrative Agent the consent of any successor agent so to act). Nothing
in this Section 10.05 shall affect the right of any Agents or any Lender to
bring proceedings against the Company in the courts of any other jurisdiction or
to serve process in any other manner permitted by applicable law.
SECTION 10.06 Payment of Costs. The Company shall pay all reasonable
costs, expenses, taxes and fees incurred by the Administrative Agent in
connection with the negotiation, preparation, execution and delivery of this
Agreement, the term sheet relating to this Agreement, the Security Documents and
all other Loan Documents, including, without limitation, all of the reasonable
professional fees and expenses of King & Spalding, special counsel to the
Administrative Agent.
SECTION 10.07 Indemnity. The Company agrees to protect, indemnify
and save harmless each Agent and each Lender, and all directors, officers,
employees and agents of each Agent and each Lender, from and against any and all
(i) claims, demands and causes of action of any nature whatsoever brought by any
person or entity not a party to this Agreement and arising from or related or
incident to this Agreement or any other Loan Document, (ii) costs and expenses
incident to the defense of such claims, demands and causes of action, including,
without limitation, reasonable attorneys' fees, and (iii) liabilities,
judgments, settlements, penalties and assessments arising from such claims,
demands and causes of action, provided such claims, costs and liabilities are
not the result of the gross negligence or willful misconduct of such Agent or
such Lender. The indemnity contained in this Section shall survive the
termination of this Agreement.
SECTION 10.08 Benefit of the Agreement.
(a) This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the respective successors and assigns of the parties
hereto, provided that the Company may not assign or transfer any of its interest
hereunder without the prior written consent of the Lenders, and no such
assignment or transfer of any such obligations shall relieve the Company of its
obligations hereunder unless each Lender shall have consented to such release in
a writing specifically referring to the obligation from which the Company is to
be released.
(b) Any Lender may make, carry or transfer Advances at, to or for
the account of, any of its branch offices or the office of an Affiliate of such
Lender. Any Lender may at any time assign all or any portion of its rights in
this Agreement and the Revolving Notes issued to it to a Federal Reserve Bank;
provided that no such assignment shall release the Lender from any of its
obligations hereunder.
(c) Each Lender may assign or delegate all or a portion of its
interests, rights and obligations under this Agreement and the other Loan
Documents (including all or a portion of any of its Commitments and the Advances
at the time owing to it and the Revolving Notes held by it) to another financial
or lending institution or entity; provided, however, that (i) the Administrative
Agent and the Company must give their prior written consent to such assignment
73
(which consent, in the case of the Company, shall not be unreasonably withheld
or delayed) unless such assignment is to an Affiliate of the assigning Lender
or, in the case of the Company, unless a Default or an Event of Default has
occurred and is continuing, (ii) such assignment or delegation is complete or is
in minimum increments of $1,000,000, and (iii) the parties to each such
assignment shall execute and deliver to the Administrative Agent an Assignment
Agreement, and, together with a Revolving Note or Revolving Notes subject to
such assignment and, unless such assignment is to an Affiliate of such Lender, a
processing and recordation fee of $1,000. The Company shall not be responsible
for such processing and recordation fee or any costs or expenses incurred by any
Lender (other than the Administrative Agent) in connection with such assignment.
From and after the effective date specified in each Assignment Agreement, which
effective date shall be at least five (5) Business Days after the execution
thereof, the assignee thereunder shall be a party hereto and to the extent of
the interest assigned by such Assignment Agreement, have the rights and
obligations of a Lender under this Agreement. Within five (5) Business Days
after receipt of the notice and the Assignment Agreement, the Company, at its
own expense, shall execute and deliver to the Administrative Agent, in exchange
for the surrendered Revolving Note or Revolving Notes, a new Revolving Note or
Revolving Notes to the order of such assignee in a principal amount equal to the
applicable Commitments assumed by it pursuant to such Assignment and Acceptance
and new Revolving Note or Revolving Notes to the assigning Lender in the amount
of its retained Commitment or Commitments. Such new Revolving Note or Revolving
Notes shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Revolving Note or Revolving Notes, shall be dated the
date of the surrendered Revolving Note or Revolving Notes which they replace,
and shall otherwise be in substantially the form attached hereto.
(d) Each Lender may from time to time sell or otherwise grant
participations in all or a portion of its rights and obligations under this
Agreement and the other Loan Documents (including all or a portion of its
Commitments and the Advances owing to it and the Revolving Notes held by it) to
another financial or lending institution or entity, whereupon the holder of any
such participation, if the participation agreement so provides, shall be
entitled to all of the rights of a Lender hereunder; provided, however, that (i)
the Administrative Agent must give its prior written consent to such
participation unless such participation is to an Affiliate of such Lender, (ii)
such selling Lender's obligations under this Agreement shall remain unchanged,
(iii) such selling Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, and (iv) the Company, the
Administrative Agent and other Lenders shall continue to deal solely and
directly with each Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents, and such Lender
shall retain the sole right to enforce the obligations of the Company relating
to the Advances and to approve any amendment, modification or waiver of any
provisions of this Agreement or the other Loan Documents. Any Lender selling a
participation hereunder shall provide prompt written notice to the Company of
the name of such participant.
SECTION 10.09 Subordination of Indebtedness. Any Indebtedness of any
Guarantor now or hereafter owed to the Company is hereby subordinated in right
of payment to the payment by such Guarantor of its Guaranty Obligations such
that if a default in the payment of the Obligations shall have occurred and be
continuing, any such Indebtedness of such Guarantor owed to the Company, if
collected or received by the Company, shall be held in trust
74
by the Company for the holders of the Obligations and be paid over to the
Lenders and the Administrative Agent for application of such Guarantor's
Guaranty Obligations.
SECTION 10.10 Maximum Interest Rate. Nothing contained in this
Agreement or any Note shall require the Company to pay interest at a rate
exceeding the Maximum Permissible Rate. If interest payable to any Lender for
any period would exceed the Maximum Permissible Rate, such interest shall be
reduced automatically to the maximum amount that will not exceed the Maximum
Permissible Rate, and interest payable to any Lender for any subsequent period,
to the extent less than the Maximum Permissible Rate, shall, to that extent, be
increased by the aggregate amount of all such reductions.
SECTION 10.11 Entire Agreement. This Agreement and the other Loan
Documents executed and delivered contemporaneously herewith, together with the
exhibits and schedules attached hereto and thereto, constitute the entire
understanding of the parties with respect to the subject matter hereof, and any
other prior or contemporaneous agreements, whether written or oral, with respect
thereto. The execution of this Agreement and the other Loan Documents by the
Company was not based upon any facts or materials provided by the Administrative
Agent or any Lender, nor was the Company or any Guarantor induced to execute
this Agreement or any other Loan Document by any representation, statement or
analysis made by the Administrative Agent or any Lender.
SECTION 10.12 Set-Off. Upon the occurrence and during the
continuance of any Event of Default, each Lender, and each of its branches and
offices, is hereby authorized by the Company, at any time and from time to time,
without notice to the Company (i) to set off against, and to appropriate and
apply to the payment of the Obligations (in each case whether matured or
unmatured) any and all amounts owing by such Lender, or any such office or
branch, to the Company (whether payable in Dollars or any other currency,
whether matured or unmatured, and, in the case of deposits, whether general or
special, time or demand and however evidenced) and (ii) pending any such action,
to the extent necessary, to hold such amounts as collateral to secure such
Obligations and Guaranty Obligations and to return as unpaid for insufficient
funds any and all checks and other items drawn against any deposits so held as
such Lender in its sole discretion may elect. Each Lender shall give the Company
notice of its intention to exercise its rights under this Section 10.12;
provided, however, that failure by such Lender to give the Company notice shall
not prevent such Lender from exercising its rights as provided in this Section.
The Company, to the fullest extent it may effectively do so under Applicable
Law, agrees that any holder of a participation in any Advance may exercise
rights of set-off and counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Company in the amount of such participation.
SECTION 10.13 Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original and all
of which, taken together, shall constitute one and the same instrument.
SECTION 10.14 Replacement Notes. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Note, and in the case of any such loss, theft or destruction, upon delivery of
any indemnity agreement reasonably satisfactory to the Company or, in the case
75
of any such mutilation, upon surrender and cancellation of such Note, the
Company shall execute and deliver, in lieu thereof, a replacement note identical
in form and substance to such Note and dated as of the date of such Note, and
upon such execution and delivery of the replacement note all references in this
Agreement and in all other Loan Documents to the Note shall be deemed to refer
to such replacement note.
SECTION 10.15 Release. In consideration of the Administrative
Agent's and the Lenders' agreement to enter into this Agreement and to establish
the Commitments hereunder, the Company hereby (a) releases, acquits and forever
discharges the Administrative Agent and the Lenders, their respective agents,
employees, officers, directors, servants, representatives, attorneys,
affiliates, successors and assigns (collectively, the "Released Parties") from
any and all liabilities, claims, suits, debts, liens, losses, causes of action,
demands, rights, damages, costs and expenses of any kind, character or nature
whatsoever, known or unknown, fixed or contingent, that the Company may have or
claim to have against the Administrative Agent and the Lenders which might arise
out of or be connected with any act of commission or omission of the
Administrative Agent or the Lenders existing or occurring on or prior to the
date of this Agreement, including, without limitation, any claims, liabilities
or obligations relating to or arising out of or in connection with the Loan
Documents (including, without limitation, arising out of or in connection with
the initiation, negotiation, closing or administration of the transactions
contemplated thereby or related thereto), from the beginning of time until the
execution and delivery of this Agreement (the "Released Claims") and (b) agrees
forever to refrain from commencing, instituting or prosecuting any lawsuit,
action or other proceeding against the Released Parties with respect to any and
all Released Claims.
76
WITNESS the hand and seal of the parties hereto through their duly
authorized officers, as of the date first above written.
NUCO2 INC.,
A FLORIDA CORPORATION
Address:
▇/▇ ▇▇▇▇▇, Inc. By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ----------------------------
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Chief Financial Officer
SUNTRUST BANK, AS SUCCESSOR BY MERGER TO
SUNTRUST BANK, SOUTH FLORIDA, NATIONAL
ASSOCIATION INDIVIDUALLY AND AS
ADMINISTRATIVE AGENT, ISSUING BANK AND
SWING LINE LENDER
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title:Vice President
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
▇▇▇▇▇▇ FINANCIAL, INC., AS A
LENDER AND AS SYNDICATION AGENT
By:/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
Address for Notices:
▇▇▇▇▇▇ FINANCIAL, INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ATTN: Account Manager
Corporate Finance
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to:
▇▇▇▇▇▇ FINANCIAL, INC.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
And
▇▇▇▇▇▇ FINANCIAL, INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ATTN: Legal Services
Corporate Finance
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
BNP PARIBAS, AS A LENDER AND AS
DOCUMENTATION AGENT
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
Address for Notices:
-------------------------
-------------------------
-------------------------
-------------------------
[SIGNATURE PAGE TO THE REVOLVING CREDIT AGREEMENT]
