U.S. $275,000,000
REVOLVING CREDIT AGREEMENT,
dated as of April 22, 1999,
among
▇▇▇▇▇▇▇-▇▇▇▇▇, INC.,
as the Borrower,
VARIOUS FINANCIAL INSTITUTIONS,
as the Lenders,
DLJ CAPITAL FUNDING, INC.,
as the Syndication Agent,
▇.▇. ▇▇▇▇▇▇ SECURITIES, INC.,
as the Documentation Agent,
and
U.S. BANCORP AG CREDIT, INC.,
as the Administrative Agent.
--------------------------------------
CO-LEAD ARRANGERS AND
CO-BOOK MANAGERS:
DLJ CAPITAL FUNDING, INC.
and
▇.▇. ▇▇▇▇▇▇ SECURITIES, INC.
TABLE OF CONTENTS
Section Page
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ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.1. Defined Terms.......................................................3
1.2. Use of Defined Terms...............................................41
1.3. Cross-References...................................................42
1.4. Accounting and Financial Determinations............................42
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES,
NOTES AND LETTERS OF CREDIT
2.1. Commitments........................................................42
2.1.1. Credit Extensions..................................................42
2.1.2. Lenders Not Permitted or Required to Make Loans....................43
2.1.3. Issuer Not Permitted or Required to Issue Letters of Credit........43
2.2. Reduction of Commitment Amounts....................................44
2.2.1. Optional...........................................................44
2.2.2. Mandatory..........................................................44
2.3. Borrowing Procedures and Funding Maintenance.......................44
2.3.1. Revolving Loans....................................................44
2.3.2. Swing Line Loans...................................................44
2.4. Continuation and Conversion Elections..............................45
2.5. Funding............................................................45
2.6. Issuance Procedures................................................46
2.6.1. Other Lenders'Participation........................................46
2.6.2. Disbursements; Conversion to Revolving Loans.......................46
2.6.3. Reimbursement......................................................47
2.6.4. Deemed Disbursements...............................................47
2.6.5. Nature of Reimbursement Obligations................................48
2.7. Register; Notes....................................................48
2.8. Equalization Transfers.............................................50
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
3.1. Repayments and Prepayments; Application............................52
3.1.1. Repayments and Prepayments.........................................52
3.1.2. Application........................................................54
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TABLE OF CONTENTS
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(continued)
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3.2. Interest Provisions................................................54
3.2.1. Rates..............................................................54
3.2.2. Post-Maturity Rates................................................54
3.2.3. Payment Dates......................................................55
3.3. Fees...............................................................55
3.3.1. Commitment Fee.....................................................55
3.3.2. The Agents'and the Co-Lead Arrangers' Fees.........................56
3.3.3. Letter of Credit Fee...............................................56
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
4.1. LIBO Rate Lending Unlawful.........................................56
4.2. Deposits Unavailable...............................................57
4.3. Increased LIBO Rate Loan Costs, etc................................57
4.4. Funding Losses.....................................................57
4.5. Increased Capital Costs............................................58
4.6. Taxes..............................................................58
4.7. Payments, Computations, etc........................................61
4.8. Sharing of Payments................................................62
4.9. Setoff.............................................................62
4.10. Change of Lending Office...........................................62
4.11. Replacement of Lenders.............................................63
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
5.1. Initial Credit Extension...........................................63
5.1.1. Resolutions, etc...................................................63
5.1.2. Delivery of Notes..................................................64
5.1.3. Transaction Documents..............................................64
5.1.4. Consummation of Transaction, etc...................................64
5.1.5. Intercreditor Agreement............................................65
5.1.6. Closing Date Certificate...........................................65
5.1.7. Subsidiary Guaranty................................................65
5.1.8. Pledge and Security Agreements, etc................................65
5.1.9. UCC Filing Service.................................................67
5.1.10. Solvency Opinion, Solvency Certificate.............................67
5.1.11. Reliance Letters...................................................67
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TABLE OF CONTENTS
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(continued)
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5.1.12. Borrowing Base Certificate; Compliance Certificate.................67
5.1.13. Financial Information, etc.........................................68
5.1.14. Closing Fees, Expenses, etc........................................68
5.1.15. Payment of Outstanding Indebtedness, etc...........................68
5.1.16. Insurance..........................................................69
5.1.17. Opinions of Counsel................................................69
5.2. All Credit Extensions..............................................69
5.2.1. Compliance with Warranties, No Default, etc........................69
5.2.2. Credit Extension Request...........................................69
5.2.3. Satisfactory Legal Form............................................70
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1. Organization, etc..................................................70
6.2. Due Authorization, Non-Contravention, etc..........................70
6.3. Government Approval, Regulation, etc...............................71
6.4. Validity, etc......................................................71
6.5. Financial Information..............................................71
6.6. No Material Adverse Change.........................................71
6.7. Litigation, Labor Controversies, etc...............................72
6.8. Subsidiaries.......................................................72
6.9. Ownership of Properties............................................72
6.10. Taxes..............................................................72
6.11. Pension and Welfare Plans..........................................73
6.12. Environmental Warranties...........................................73
6.13. Accuracy of Information............................................74
6.14. Regulations U and X................................................74
6.15. Year 2000..........................................................75
6.16. Status of Obligations as Senior Indebtedness; First
Mortgage Note Offering; First Mortgage Notes; etc..................75
6.17. Solvency...........................................................75
ARTICLE VII
COVENANTS
7.1. Affirmative Covenants..............................................76
7.1.1. Financial Information, Reports, Notices, etc.......................76
7.1.2. Maintenance of Existence...........................................78
iii
TABLE OF CONTENTS
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(continued)
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7.1.3. Maintenance of Properties..........................................79
7.1.4. Insurance..........................................................79
7.1.5. Books and Records..................................................79
7.1.6. Environmental Covenant.............................................80
7.1.7. Future Subsidiaries................................................80
7.1.8. Use of Proceeds....................................................81
7.1.9. Cash Management Accounts...........................................81
7.2. Negative Covenants.................................................81
7.2.1. Business Activities................................................82
7.2.2. Indebtedness.......................................................82
7.2.3. Liens..............................................................84
7.2.4. Financial Covenants................................................85
7.2.5. Investments........................................................87
7.2.6. Restricted Payments, etc...........................................89
7.2.7. Capital Expenditures...............................................89
7.2.8. Consolidation, Merger, etc.........................................90
7.2.9. Asset Dispositions, etc............................................90
7.2.10. Modification of Certain Agreements.................................91
7.2.11. Transactions with Affiliates.......................................91
7.2.12. Negative Pledges, Restrictive Agreements, etc......................91
7.2.13. Sale and Leaseback.................................................92
7.2.14. Stock of Subsidiaries..............................................92
ARTICLE VIII
EVENTS OF DEFAULT
8.1. Listing of Events of Default.......................................92
8.1.1. Non-Payment of Obligations.........................................92
8.1.2. Breach of Warranty.................................................92
8.1.3. Non-Performance of Certain Covenants and Obligations...............93
8.1.4. Non-Performance of Other Covenants and Obligations.................93
8.1.5. Default on Other Indebtedness......................................93
8.1.6. Judgments..........................................................93
8.1.7. Pension Plans......................................................93
8.1.8. Change in Control..................................................93
8.1.9. Bankruptcy, Insolvency, etc........................................94
8.1.10. Impairment of Security, etc........................................94
8.2. Action if Bankruptcy...............................................95
8.3. Action if Other Event of Default...................................95
iv
TABLE OF CONTENTS
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(continued)
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ARTICLE IX
THE AGENTS
9.1. Actions............................................................95
9.2. Funding Reliance, etc..............................................96
9.3. Exculpation........................................................96
9.4. Successor..........................................................97
9.5. Credit Extensions by Each Agent and Issuer.........................97
9.6. Credit Decisions...................................................97
9.7. Copies, etc........................................................98
9.8. The Syndication Agent and the Documentation Agent..................98
9.9. Notices of Default.................................................98
ARTICLE X
MISCELLANEOUS PROVISIONS
10.1. Waivers, Amendments, etc...........................................99
10.2. Notices...........................................................100
10.3. Payment of Costs and Expenses.....................................100
10.4. Indemnification...................................................101
10.5. Survival..........................................................102
10.6. Severability......................................................102
10.7. Headings..........................................................102
10.8. Execution in Counterparts, Effectiveness, etc.....................102
10.9. Governing Law; Entire Agreement...................................103
10.10. Successors and Assigns............................................103
10.11. Sale and Transfer of Loans; Participations in Loans and Notes.....103
10.11.1. Assignments.......................................................103
10.11.2. Participations....................................................105
10.12. Confidentiality...................................................106
10.13. Other Transactions................................................107
10.14. Forum Selection and Consent to Jurisdiction.......................107
10.15. Waiver of Jury Trial..............................................107
v
SCHEDULES:
----------
Schedule I - Disclosure Schedule
Schedule II - Percentages and Administrative Information
Schedule III - Location of Secured Inventory
Schedule IV - Limits on Borrowing Base Availability
EXHIBITS:
---------
Exhibit A-1 - Form of Revolving Note
Exhibit A-2 - Form of Swing Line Note
Exhibit B-1 - Form of Borrowing Request
Exhibit B-2 - Form of Issuance Request
Exhibit C - Form of Continuation/Conversion Notice
Exhibit D - Form of Closing Date Certificate
Exhibit E-1 - Form of Compliance Certificate
Exhibit E-2 - Form of Borrowing Base Certificate
Exhibit F-1 - Form of Parent Guaranty and Pledge Agreement
Exhibit F-2 - Form of Borrower Pledge and Security Agreement
Exhibit F-3 - Form of Subsidiary Pledge and Security Agreement
Exhibit G - Form of Subsidiary Guaranty
Exhibit H - Form of Lender Assignment Agreement
Exhibit I - Form of Intercreditor Agreement
Exhibit J - Form of Solvency Certificate
vi
REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT, dated as of April 22, 1999, among
▇▇▇▇▇▇▇-▇▇▇▇▇, INC., a Delaware corporation (the "Borrower"), the various
financial institutions as are or may become parties hereto (collectively, the
"Lenders"), DLJ CAPITAL FUNDING, INC. ("DLJ"), as the syndication agent (the
"Syndication Agent"), ▇.▇. ▇▇▇▇▇▇ SECURITIES, INC. ("▇▇▇▇▇▇"), as the
documentation agent (the "Documentation Agent"), U.S. BANCORP AG CREDIT, INC.
("U.S. Bancorp"), as the collateral agent and as the administrative agent (the
"Administrative Agent", together with the Syndication Agent and the
Documentation Agent, sometimes referred to herein collectively as the "Agents"
and each as an "Agent") for the Lenders, and DLJ and ▇▇▇▇▇▇, as co-lead
arrangers and co-book managers (in such capacity, the "Co-Lead Arrangers").
W I T N E S S E T H:
WHEREAS, certain principals (the "Management Investors") of the Borrower
and 399 Venture Partners, Inc., a Delaware corporation and an affiliate of
Citicorp Venture Capital Ltd. ("399VP", and, together with the Management
Investors, the "Equity Investors"), own all of the issued and outstanding
Capital Stock of ▇▇▇▇▇▇▇-▇▇▇▇▇ Group, Inc., a Delaware corporation ("Parent");
WHEREAS, the Borrower intends to acquire all of the issued and outstanding
equity securities of the IMC Businesses (as hereinafter defined) pursuant to a
transaction in which, among other things, (a) the Borrower will acquire (the
"IMC Acquisition") all of the issued and outstanding equity securities of IMC
AgriBusiness, Inc., a Delaware corporation ("IMC AgriBusiness"), ▇▇▇▇▇▇'▇ ▇▇
Services, Inc., a Kentucky corporation ("▇▇▇▇▇▇"), and IMC Nitrogen Company, a
Delaware corporation ("IMC Nitrogen", and, together with IMC AgriBusiness and
▇▇▇▇▇▇, and each of their respective Subsidiaries, the "IMC Businesses"), from
IMC Global, Inc., a Delaware corporation (the "Seller"), and (b) the Equity
Investors shall cause Parent to acquire all of the outstanding Capital Stock of
the Borrower (the "R-C Acquisition", and, together with the IMC Acquisition, the
"Acquisition Transactions");
WHEREAS, after giving effect to the Acquisition Transactions, each of the
IMC Businesses will be wholly-owned, direct and indirect Subsidiaries of the
Borrower, and the Borrower will be a wholly-owned Subsidiary of Parent;
WHEREAS, in connection with the Acquisition Transactions, and pursuant to
the Transaction Documents, the following capital-raising transactions and other
transactions will occur prior to or contemporaneously with the consummation of
the Acquisition Transactions and the making of the initial Credit Extensions
hereunder:
(a) the Borrower will issue first mortgage notes due April 22, 2009
(the "First Mortgage Note Offering") for gross cash proceeds of
$200,000,000, which proceeds will be used to partially fund the Transaction
(as hereinafter defined);
(b) Parent will receive gross cash proceeds in an aggregate amount
equal to approximately $59,000,000 from 399VP or certain of its affiliates
from the issuance (the "Cash Equity Issuance") to 399VP or certain of its
affiliates of (i) non-cash pay junior subordinated notes with an aggregate
outstanding principal amount equal to $10,000,000 (the "399VP Notes")
payable to certain affiliates of 399VP, (ii) $47,400,000 of non-cash pay
preferred stock of Parent issued to 399VP and (iii) $1,600,000 of common
stock of Parent issued to 399VP, and Parent shall contribute such aggregate
gross cash proceeds from the Cash Equity Issuance to the Borrower in the
form of cash common equity;
(c) Parent will receive Capital Stock of the Borrower with a value
equal to approximately $20,500,000 in exchange for the issuance (the
"Rollover Equity Issuance") to the Management Investors of (i) $8,300,000
of zero preferred stock of Parent, (ii) $11,800,000 of non-cash pay
preferred stock of Parent and (iii) $400,000 of common stock of Parent; and
(d) Parent will issue (the "IMC Rollover Issuance", and, together with
the Rollover Equity Issuance and the Cash Equity Issuance, the "Equity
Issuances"; the Equity Issuances and the First Mortgage Note Offering are
hereinafter collectively referred to as the "Capital Transactions")
$10,000,000 of non-cash pay junior subordinated notes to the Seller (the
"Seller Notes") as partial consideration for the purchase price of the IMC
Acquisition;
WHEREAS, in connection with the Acquisition Transactions, the Capital
Transactions, the refinancing of approximately $75,600,000 of existing debt of
the Borrower and the IMC Businesses (the "Refinancing", together with the
Acquisition Transactions, the Capital Transactions and each of the other
transactions contemplated hereby, the "Transaction") and the ongoing working
capital and general corporate needs of the Borrower, the Borrower desires to
obtain the following financing facilities from the Lenders:
(a) a Revolving Loan Commitment (to include availability for Revolving
Loans, Swing Line Loans and Letters of Credit) pursuant to which Borrowings
of Revolving Loans, in a maximum aggregate principal amount (together with
all Swing Line Loans and Letter of Credit Outstandings) not to exceed
$275,000,000, will be made on and subsequent to the Closing Date but prior
to the Revolving Loan Commitment Termination Date;
(b) a Letter of Credit Commitment pursuant to which the Issuer will
issue Letters of Credit for the account of the Borrower and its Restricted
Subsidiaries from time to time on and subsequent to the Closing Date but
prior to the Revolving Loan Commitment Termination Date in a maximum
2
aggregate Stated Amount at any one time outstanding not to exceed
$10,000,000; and
(c) a Swing Line Loan Commitment pursuant to which Borrowings of Swing
Line Loans, in an aggregate outstanding principal amount not to exceed
$25,000,000, will be made subsequent to the Closing Date but prior to the
Revolving Loan Commitment Termination Date;
WHEREAS, the Lenders are willing, on the terms and subject to the
conditions hereinafter set forth, to extend such Commitments, make such Loans to
the Borrower and issue (or participate in) such Letters of Credit;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.1. Defined Terms. The following terms (whether or not
underscored) when used in this Agreement, including its preamble and recitals,
shall, except where the context otherwise requires, have the following meanings
(such meanings to be equally applicable to the singular and plural forms
thereof):
"399VP" is defined in the first recital.
"399VP Notes" is defined in clause (b) of the fourth recital.
"Account" means any account (as that term is defined in Section 9-106 of
the UCC) of the Borrower or any Restricted Subsidiary arising from the sale or
lease of goods or rendering of services.
"Account Debtor" is defined in clause (b) of the definition of "Eligible
Account".
"Acquired Borrowing Base Assets" is defined in clause (b)(iii) of the
definition of "Permitted Acquisition".
"Acquisition Transactions" is defined in the second recital.
"Administrative Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Administrative
Agent pursuant to Section 9.4.
3
"Administrative Agent's Fee Letter" means the confidential fee letter,
dated April 12, 1999, among the Borrower and U.S. Bancorp, as amended,
supplemented, amended and restated or otherwise modified from time to time.
"Affiliate" of any Person means any other Person which, directly or
indirectly, controls, is controlled by or is under common control with such
Person (excluding any trustee under, or any committee with responsibility for
administering, any Plan). A Person shall be deemed to be "controlled by" any
other Person if such other Person possesses, directly or indirectly, power (a)
to vote 10% or more of the Capital Stock (on a fully diluted basis) of such
Person having ordinary voting power for the election of directors or managing
general partners, or (b) to direct or cause the direction of the management and
policies of such Person whether by contract or otherwise.
"Agent" and "Agents" are defined in the preamble.
"Agreement" means, on any date, this Revolving Credit Agreement as
originally in effect on the Closing Date and as thereafter from time to time
amended, supplemented, amended and restated, or otherwise modified and in effect
on such date.
"Alternate Base Rate" means, for any day and with respect to all Base Rate
Loans, the higher of: (a) 0.50% per annum above the latest Federal Funds Rate
and (b) the rate of interest in effect for such day as most recently publicly
announced or established by the Administrative Agent (or any Affiliate of the
Administrative Agent) in Minneapolis, Minnesota (or such other place of business
as may be designated by any successor Administrative Agent) as its "reference
rate". The "reference rate" is a rate set by the Administrative Agent based upon
various factors including the Administrative Agent's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above or below such announced
rate. Any change in the reference rate established or announced by the
Administrative Agent shall take effect at the opening of business on the day of
such establishment or announcement by the Administrative Agent.
"Annualized" means, with respect to the determination of Interest Expense
for the first three Fiscal Quarters ending after the Closing Date, the amount
determined by multiplying the actual amount of Interest Expense from the Closing
Date to the date of such calculation multiplied by 366 and divided by the number
of days from (and including) the Closing Date to (and including) the date of
such calculation.
"Applicable Commitment Fee" means, (a) for each day from the Closing Date
through (and including) the first anniversary of the Closing Date, a fee which
shall accrue at a rate of 1/2 of 1% per annum, and (b) for each day thereafter,
a fee which shall accrue at the applicable rate per annum set forth below under
the column entitled "Applicable Commitment Fee", determined by reference to the
applicable Leverage Ratio referred to below:
4
Leverage Applicable
Ratio Commitment Fee
-------- --------------
Greater than
or equal to 3.5:1 .500%
Less than 3.5:1 but greater
than
or equal to 2.5:1 .375%
Less than 2.5:1 .250%
The Leverage Ratio used to compute the Applicable Commitment Fee shall be that
set forth in the Compliance Certificate most recently delivered by the Borrower
to the Administrative Agent; changes in the Applicable Commitment Fee resulting
from a change in the Leverage Ratio shall become effective upon delivery by the
Borrower to the Administrative Agent of a new Compliance Certificate pursuant to
clause (c) of Section 7.1.1. If the Borrower shall fail to deliver a Compliance
Certificate within the number of days required pursuant to clause (c) of Section
7.1.1 (without giving effect to any grace period), the Applicable Commitment Fee
from and including the first day after the date on which such Compliance
Certificate was required to be delivered to, but not including the date the
Borrower delivers to, the Administrative Agent an appropriately completed
Compliance Certificate shall conclusively equal the highest Applicable
Commitment Fee set forth above.
"Applicable Margin" means at all times during the applicable periods set
forth below (a) with respect to the unpaid principal amount of each Loan
maintained as a Base Rate Loan, the applicable percentage set forth below under
the column entitled "Applicable Margin for Base Rate Loans" and (b) with respect
to the unpaid principal amount of each Loan maintained as a LIBO Rate Loan, the
applicable percentage set forth below under the column entitled "Applicable
Margin for LIBO Rate Loans", in each case, determined by reference to the
applicable Leverage Ratio referred to below:
Applicable
Margin For Applicable
Leverage Base Rate Margin For
Ratio Loans LIBO Rate Loans
-------- ---------- ----------------
Greater than or equal to 5.5:1 1.75% 3.00%
Less than 5.5:1 but greater
than or equal to 3.5:1 1.50% 2.75%
Less than 3.5:1 but greater
than or equal to 2.5:1 1.25% 2.50%
Less than 2.5:1 1.00% 2.25%
5
Notwithstanding anything to the contrary set forth in this Agreement (including
the then effective Leverage Ratio), from the Closing Date through (and
including) the first anniversary of the Closing Date, the Applicable Margin for
all Loans maintained as (a) Base Rate Loans shall be 1.50% and (b) LIBO Rate
Loans shall be 2.75%. The Leverage Ratio used to compute the Applicable Margin
shall be that set forth in the Compliance Certificate most recently delivered by
the Borrower to the Administrative Agent; changes in the Applicable Margin
resulting from a change in the Leverage Ratio shall become effective upon
delivery by the Borrower to the Administrative Agent of a new Compliance
Certificate pursuant to clause (c) of Section 7.1.1. If the Borrower shall fail
to deliver a Compliance Certificate within the number of days required pursuant
to clause (c) of Section 7.1.1 (without giving effect to any grace period), the
Applicable Margin from and including the first day after the date on which such
Compliance Certificate was required to be delivered to, but not including the
date the Borrower delivers to, the Administrative Agent an appropriately
completed Compliance Certificate shall conclusively equal the highest Applicable
Margin set forth above.
"Assignee Lender" is defined in Section 10.11.1.
"Assignor Lender" is defined in Section 10.11.1.
"Authorized Officer" means, relative to any Obligor, those of its officers
whose signatures and incumbency shall have been certified to the Agents and the
Lenders pursuant to Section 5.1.1.
"Base Net Worth" means Net Worth as of June 30, 1999, as set forth in the
Compliance Certificate delivered by the Borrower to the Administrative Agent for
the Fiscal Quarter ending on June 30, 1999.
"Base Rate Loan" means a Loan bearing interest at a fluctuating rate
determined by reference to the Alternate Base Rate.
"Borrower" is defined in the preamble.
"Borrower Pledge and Security Agreement" means the Pledge Agreement
executed and delivered by an Authorized Officer of the Borrower pursuant to
clause (b) of Section 5.1.8, substantially in the form of Exhibit F-2 hereto, as
amended, supplemented, amended and restated or otherwise modified from time to
time.
"Borrowing" means the Loans of the same type and, in the case of LIBO Rate
Loans, having the same Interest Period made by all Lenders on the same Business
Day and pursuant to the same Borrowing Request in accordance with Section 2.1.
6
"Borrowing Base Amount" means, at any time, the sum (without duplication)
of
(a) the Net Asset Value of all Eligible Accounts at such time as
determined in accordance with clause (a) of the definition of "Net Asset
Value" and as certified by the Borrower in the most recently delivered
Borrowing Base Certificate;
plus
(b) the Net Asset Value of Eligible Inventory at such time as
determined in accordance with clause (b) of the definition of "Net Asset
Value" and as certified by the Borrower in the most recently delivered
Borrowing Base Certificate;
plus
(c) the Net Asset Value of all Eligible Rebate Receivables at such
time as determined in accordance with clause (c) of the definition of "Net
Asset Value" and as certified by the Borrower in the most recently
delivered Borrowing Base Certificate;
plus
(d) the Net Asset Value of all Eligible Prepaid Inventory at such time
as determined in accordance with clause (d) of the definition of "Net Asset
Value" and as certified by the Borrower in the most recently delivered
Borrowing Base Certificate.
"Borrowing Base Certificate" means a certificate duly completed and
executed by the treasurer, assistant treasurer, chief accounting or financial
Authorized Officer of the Borrower, substantially in the form of Exhibit E-2
hereto.
"Borrowing Request" means a loan request and certificate duly executed by
an Authorized Officer of the Borrower, substantially in the form of Exhibit B-1
hereto.
"Business Day" means any day which is neither a Saturday nor Sunday nor a
legal holiday on which banks are authorized or required to be closed in New York
City or Minneapolis, Minnesota, and, with respect to Borrowings of, Interest
Periods with respect to, payments of principal and interest in respect of, and
conversions of Base Rate Loans into, LIBO Rate Loans, any day on which dealings
in Dollars are carried on in the London interbank market.
"Capital Expenditures" means for any period, the sum, without duplication,
of the aggregate amount of all expenditures of the Borrower and its Restricted
Subsidiaries for fixed or capital assets made during such period which, in
accordance with GAAP, would be classified as capital expenditures.
7
"Capital Stock" means, with respect to any Person, (a) any and all shares,
interests, participations, rights or other equivalents of or interests in
(however designated) corporate or capital stock, including shares of preferred
or preference stock of such Person, (b) all partnership interests (whether
general or limited) in such Person, (c) all membership interests or limited
liability company interests in such Person, and (d) all other equity or
ownership interests in such Person of any other type.
"Capital Transactions" is defined in clause (d) of the fourth recital.
"Capitalized Lease Liabilities" means, without duplication, all monetary
obligations of the Borrower or any of its Restricted Subsidiaries under any
leasing or similar arrangement which, in accordance with GAAP, would be
classified as capitalized leases, and, for purposes of this Agreement and each
other Loan Document, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP, and the stated maturity
thereof shall be the date of the last payment of rent or any other amount due
under such lease prior to the first date upon which such lease may be terminated
by the lessee without payment of a premium or penalty.
"Cash Collateralize" means, with respect to a Letter of Credit, the payment
to the Administrative Agent of immediately available funds in an amount equal to
the Stated Amount of such Letter of Credit, deposited in a cash collateral
account with the Administrative Agent or its designee on terms satisfactory to
the Administrative Agent.
"Cash Equity Issuance" is defined in clause (b) of the fourth recital.
"Cash Equivalent Investment" means, at any time:
(a) any direct obligation of (or unconditionally guaranteed or insured
by) the United States of America or a State thereof (or any agency or
political subdivision thereof, to the extent such obligations are supported
by the full faith and credit of the United States of America or a State
thereof) maturing not more than one year after such time,
(b) commercial paper maturing not more than 270 days from the date of
issue, which is issued by
(i) a corporation (other than an Affiliate of any Obligor)
organized under the laws of any State of the United States or of the
District of Columbia and rated A-1 or higher by S&P or P-1 or higher
by ▇▇▇▇▇'▇; or
(ii) any Lender (or its holding company);
8
(c) any certificate of deposit, time deposit or bankers acceptance,
maturing not more than one year after its date of issuance, which is issued
by either
(i) any bank organized under the laws of the United States (or
any State thereof) and which has (A) a credit rating of A2 or higher
from ▇▇▇▇▇'▇ or A or higher from S&P and (B) a combined capital and
surplus greater than $500,000,000; or
(ii) any Lender;
(d) any repurchase agreement having a term of 30 days or less entered
into with any Lender or any commercial banking institution satisfying the
criteria set forth in clause (c)(i) which
(i) is secured by a fully perfected security interest in any
obligation of the type described in clause (a); and
(ii) has a market value at the time such repurchase agreement is
entered into of not less than 100% of the repurchase obligation of
such commercial banking institution thereunder; or
(e) any money market or similar fund the assets of which are comprised
exclusively of any of the items specified in clauses (a) through (c) above
and as to which withdrawals are permitted at least every 90 days.
"Casualty Event" means the damage, destruction or condemnation, as the case
may be, of any property of the Borrower or any of its Restricted Subsidiaries.
"CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
"Change in Control" means
(a) the failure of the Borrower at any time to own (directly or
indirectly), free and clear of all Liens and encumbrances (other than Liens
permitted to exist under clauses (a), (e) and (h) of Section 7.2.3), all
right, title and interest in 100% of the Capital Stock of each of the IMC
Businesses;
(b) the failure of Parent at any time to own (directly or indirectly),
free and clear of all Liens and encumbrances (other than Liens permitted to
exist under clauses (a), (e) and (h) of Section 7.2.3), all right, title
and interest in 100% of the Capital Stock of the Borrower;
9
(c) any Person, or two or more Persons acting in concert (other than
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and his controlled Affiliates), individually or
collectively, acquiring a greater percentage of the beneficial ownership
(within the meaning of Rule 13d-3 of the Exchange Act) of the voting
Capital Stock of Parent on a fully diluted basis than 399VP, CVC and each
of their controlled Affiliates, collectively;
(d) the failure of 399VP, CVC and each of their controlled Affiliates,
collectively, to hold at least 37.5% of the voting Capital Stock held by
such Persons, collectively, on the Closing Date, subject to any stock
splits, distributions, redemptions or repurchases;
(e) the first day on which a majority of the members of the Board of
Directors of the Borrower are not Continuing Directors; or
(f) any "Change of Control" as such term is defined in the First
Mortgage Note Indenture.
"Closing Date" means the date of the initial Credit Extension, not to be
later than April 30, 1999.
"Closing Date Certificate" means a certificate of an Authorized Officer of
the Borrower substantially in the form of Exhibit D hereto, delivered pursuant
to Section 5.1.6.
"Co-Lead Arrangers" is defined in the preamble.
"Code" means the Internal Revenue Code of 1986, and the regulations
thereunder, in each case as amended, reformed or otherwise modified from time to
time.
"Combine" and "Combination" are defined in Section 7.2.8.
"Commitment" means, as the context may require, a Lender's Revolving Loan
Commitment, Swing Line Loan Commitment or Letter of Credit Commitment.
"Commitment Amount" means, as the context may require, the Revolving Loan
Commitment Amount, the Swing Line Loan Commitment Amount or the Letter of Credit
Commitment Amount.
"Commitment Termination Event" means (a) the occurrence of any Event of
Default described in clauses (a) through (d) of Section 8.1.9 with respect to
any Obligor, or (b) the occurrence and continuance of any other Event of Default
and either (i) the declaration of all or any portion of the Loans to be due and
payable pursuant to Section 8.3, or (ii) the giving of notice by the
Administrative Agent, acting at the direction of the Required Lenders, to the
Borrower that the Commitments have been terminated.
10
"Commodity Hedging Agreements" means with respect to any Person, all
liabilities of such Person under exchange agreements, swap agreements, cap
agreements, future agreements, forward agreements and all other agreements or
arrangements (of a non-speculative nature) designed to protect such Person
against fluctuations in commodity prices.
"Compliance Certificate" means a certificate duly completed and executed by
the president, chief executive, treasurer, controller or chief financial
Authorized Officer of the Borrower, substantially in the form of Exhibit E-1
hereto, together with such changes thereto as the Agents may from time to time
reasonably request for the purpose of monitoring the Borrower's compliance with
the financial covenants contained herein.
"Contingent Liability" means any agreement, undertaking or arrangement by
which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the Indebtedness of any
other Person (other than by endorsements of instruments in the course of
collection), or guarantees the payment of dividends or other distributions upon
the shares of Capital Stock of any other Person. The amount of any Person's
obligation under any Contingent Liability shall (subject to any limitation set
forth therein) be deemed to be the outstanding principal amount of the debt,
obligation or other liability guaranteed thereby.
"Continuation/Conversion Notice" means a notice of continuation or
conversion and certificate duly executed by an Authorized Officer of the
Borrower, substantially in the form of Exhibit C hereto.
"Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of the Borrower who:
(a) was a member of such Board on the date hereof; or
(b) was nominated for election or elected to such Board with the
approval of a majority of the Continuing Directors who were members of such
Board at the time of such nomination or election.
"Controlled Group" means all members of a controlled group of corporations
and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
"Credit Extension" means, as the context may require, (a) the making of a
Loan by a Lender or (b) the issuance of any Letter of Credit, or the extension
of any Stated Expiry Date of any previously issued Letter of Credit, by the
Issuer.
"Credit Extension Request" means, as the context may require, any Borrowing
Request or Issuance Request.
11
"Crop Term Accounts" means Accounts as to which the Borrower grants certain
Account Debtors extended payment due dates of not later than the end of the Crop
Year in which such Accounts arise.
"Crop Year" means October 1 through September 30 of the next succeeding
year for winter wheat, or January 1 through January 31 of the next succeeding
year for all other crops.
"Current Assets" means, on any date, without duplication, all assets which,
in accordance with GAAP, would be included as current assets on a consolidated
balance sheet of the Borrower and its Restricted Subsidiaries at such date.
"Current Liabilities" means, on any date, without duplication, all amounts
which, in accordance with GAAP, would be included as current liabilities on a
consolidated balance sheet of the Borrower and its Restricted Subsidiaries at
such date, excluding current maturities of Indebtedness.
"Current Ratio" means, at any time, the ratio of (a) Current Assets to (b)
Current Liabilities plus, without duplication, the amount of outstanding Loans
and Letter of Credit Outstandings at such time.
"Customer Deposit" means a deposit received by the Borrower or any
Restricted Subsidiary from a customer of the Borrower or such Restricted
Subsidiary in payment for the future delivery of Inventory.
"CVC" means Citicorp Venture Capital Ltd., a New York corporation.
"Debt" means, without duplication, the outstanding principal amount of all
Indebtedness of the Borrower and its Restricted Subsidiaries that is of the type
referred to in clause (a), (b), (c) and (e) of the definition of "Indebtedness"
and any Contingent Liability in respect of any of the foregoing.
"Default" means any Event of Default or any condition, occurrence or event
which, after notice or lapse of time or both, would constitute an Event of
Default.
"Deferred Rebate Receivable" means a Rebate Receivable, which, by the terms
thereof, is to be paid to the Borrower or any Restricted Subsidiary more than
365 days after the date on which the accrual of such Rebate Receivable is
accounted for by the Borrower or such Restricted Subsidiary.
"Disbursement" is defined in Section 2.6.2.
"Disbursement Date" is defined in Section 2.6.2.
"Disbursement Due Date" is defined in Section 2.6.2.
12
"Disclosure Schedule" means the Disclosure Schedule attached hereto as
Schedule I, as it may be amended, supplemented or otherwise modified from time
to time by the Borrower with the written consent of the Required Lenders.
"Disposition" (or correlative words such as "Dispose") means any sale,
transfer, lease, contribution or other conveyance (including by way of merger)
of, or the granting of options, warrants or other rights to, any of the
Borrower's or its Restricted Subsidiaries' assets (including accounts
receivables and Capital Stock of Restricted Subsidiaries) to any other Person
(other than to another Obligor) in a single transaction or series of related
transactions.
"DLJ" is defined in the preamble.
"Documentation Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Documentation
Agent pursuant to Section 9.4.
"Dollar" and the sign "$" mean lawful money of the United States.
"EBITDA" means, for any applicable period, the sum (without duplication)
for the Borrower and its Restricted Subsidiaries on a consolidated basis of:
(a) Net Income,
plus
(b) the amount deducted, in determining Net Income, representing
amortization,
plus
(c) the amount deducted, in determining Net Income, representing all
income Taxes (whether paid in cash or deferred),
plus
(d) the amount deducted, in determining Net Income, representing
Interest Expense,
plus
13
(e) the amount deducted, in determining Net Income, representing
depreciation of assets,
plus
(f) the amount deducted, in determining Net Income, representing
non-cash charges (including extraordinary losses),
minus
(g) the amount included, in determining Net Income, representing
non-cash credits (including extraordinary gains).
Notwithstanding the foregoing, (i) for the third Fiscal Quarter of the 1998
Fiscal Year, the fourth Fiscal Quarter of the 1998 Fiscal Year and the first
Fiscal Quarter of the 1999 Fiscal Year, EBITDA shall be deemed to be
-$7,318,097, $2,280,306 and $4,362,161, respectively, and (ii) with respect to
EBITDA calculated for a four Fiscal Quarter period, EBITDA shall be adjusted to
include the Permitted Acquisition(s) made during such Fiscal Quarter (such
adjustments to be satisfactory to the Agents) as if such Permitted
Acquisition(s) had been made at the beginning of such four Fiscal Quarter
period.
"Effective Date" means the date this Agreement becomes effective pursuant
to Section 10.8.
"Eligible Account" means, with respect to the Borrower and any Restricted
Subsidiary, at the time of any determination thereof, any Account as to which
each of the following requirements has been fulfilled to the reasonable
satisfaction of the Administrative Agent:
(a) the Borrower or such Restricted Subsidiary owns such Account free
and clear of all Liens other than any Lien in favor of the Administrative
Agent granted pursuant to this Agreement or another Loan Document (and,
other than in the case of Accounts referred to in clause (d) below, the
Administrative Agent shall have a first-priority (other than inchoate
statutory Liens otherwise permitted by Section 7.2.3) perfected Lien on
such Account);
(b) such Account is a legal, valid, binding and enforceable obligation
of the Person obligated under such Account (the "Account Debtor") (except
as such enforceability may be, at any time of determination, limited by
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally and by principles of equity);
14
(c) such Account is not subject to any bona fide dispute, setoff,
counterclaim or other claim or defense on the part of the Account Debtor or
any other Person denying liability under such Account; provided, however,
that any such Account shall constitute an Eligible Account to the extent it
is not subject to any such dispute, setoff, counterclaim or other claim or
defense;
(d) the Borrower or such Restricted Subsidiary has the full and
unqualified right to assign and ▇▇▇▇▇ ▇ ▇▇▇▇ in such Account to the
Administrative Agent as security for the Obligations (and the
Administrative Agent shall have a perfected, first-priority Lien on such
Account);
(e) such Account is evidenced by an invoice rendered to the Account
Debtor (which shall include computer records) or is reflected by computer
records maintained by the Borrower or such Restricted Subsidiary evidencing
such Account and is not evidenced by any instrument or chattel paper (as
the terms "instrument" and "chattel paper" are defined in Section 9-105 of
the UCC) unless such instrument or chattel paper has been delivered to the
Administrative Agent pursuant to any Pledge and Security Agreement;
(f) with respect to such Account, no Account Debtor is
(i) an Affiliate of the Borrower or any of its Restricted
Subsidiaries (other than Conetoe Chemical, Inc. and ▇▇▇▇▇▇ ▇▇▇▇▇ AG
Services, Inc., and any 399VP-related company which is deemed an
Affiliate solely by reason of 399VP's common ownership interest in
each of Parent and such 399VP-related company), or
(ii) the subject of any reorganization, bankruptcy, receivership,
custodianship, insolvency or other condition analogous with respect to
such Account Debtor to those described in clauses (a) through (d) of
Section 8.1.9;
(g) such Account is not Past Due;
(h) such Account is not an Account owing by an Account Debtor having,
at the time of any determination of Eligible Accounts, Past Due Accounts
which exceed 35% of the aggregate outstanding amount of all of such Account
Debtor's Accounts (other than any Accounts which are the subject of bona
fide disputes between such Account Debtor and the Borrower or such
Restricted Subsidiary, as the case may be);
(i) with respect to the Account Debtor under such Account, neither the
Borrower nor any such Restricted Subsidiary is indebted to such Account
Debtor (including any Person who has a Customer Deposit with the Borrower
or any Restricted Subsidiary), unless the Borrower or such Restricted
Subsidiary and such Account Debtor have entered into an agreement whereby
15
the Account Debtor is prohibited from exercising any right of setoff with
respect to the Accounts of the Borrower or such Restricted Subsidiary,
provided, that in any event, if such an agreement prohibiting setoff rights
with respect to any such Account is not delivered by the Account Debtor,
then only up to the amount that the Borrower or such Restricted Subsidiary
is indebted to such Account Debtor under such Account shall be excluded as
an Eligible Account pursuant to this clause;
(j) such Account arises from a sale to an Account Debtor located
within the United States, unless the Account Debtor's obligations (or that
portion of such obligations which is acceptable to the Administrative
Agent) with respect to a sale to an Account Debtor not located within the
United States are secured by a letter of credit, guaranty or eligible
bankers' acceptance having terms, and from such issuers and confirmation
banks, as are reasonably acceptable to the Administrative Agent; provided,
that Accounts arising from sales to Account Debtors located within Canada
need not be so secured up to an aggregate amount of $2,000,000 at any time
outstanding;
(k) such Account is not an Account owing by an Account Debtor having,
at the time of any determination of Eligible Accounts, in excess of 5% of
the aggregate face amount of all Eligible Accounts of all Account Debtors;
(l) such Account is not an Account which arose as a result of the sale
of consigned inventory owned by a third party;
(m) such Account is not an Account owed to Lebanon Chemical
Corporation pursuant to the purchase agreement, dated as of December 16,
1998; and
(n) such Account is not a Rebate Receivable;
provided, however, that, with respect to any Eligible Account which is subject
to a discount or a rebate to be granted to the Account Debtor, the amount of
such discount or rebate, as the case may be, shall be excluded from the value of
such Eligible Account dollar-for-dollar.
"Eligible Inventory" means, with respect to the Borrower and any Restricted
Subsidiary, at the time of any determination thereof, any Inventory located in
the United States arising in the ordinary course of business and as to which
each of the following requirements has been fulfilled to the reasonable
satisfaction of the Administrative Agent:
(a) the Borrower or such Restricted Subsidiary owning such Inventory,
as the case may be, has full and unqualified right to assign and grant, and
has assigned and granted, a perfected Lien in such Inventory to the
Administrative Agent as security for the Obligations (and the
Administrative Agent shall have a perfected, first-priority Lien on such
Inventory (subject to Liens permitted pursuant to clause (e) of Section
7.2.3));
16
(b) the Borrower or such Restricted Subsidiary owns such Inventory
free and clear of all Liens other than any Lien in favor of the
Administrative Agent granted pursuant to this Agreement or another Loan
Document and other than inchoate statutory Liens otherwise permitted by
Section 7.2.3;
(c) none of such Inventory is obsolete, unsalable, damaged or
otherwise unfit for sale or consumption or further processing;
(d) none of such Inventory is in the possession of a third party
(other than any Inventory Agent pursuant to clause (e) below) unless such
Inventory is
(i) at a location listed on Schedule III hereto (which Schedule
III may be modified and/or supplemented from time to time with notice
to and consent from the Administrative Agent), and for which the
Administrative Agent has received a bailee letter satisfactory to the
Administrative Agent, executed by such third party, or
(ii) covered by negotiable warehouse receipts or negotiable bills
of lading issued by either (A) a warehouseman licensed and bonded by
the United States Department of Agriculture or any state's equivalent
Governmental Authority or (B) a recognized carrier having an office in
the United States and in a financial condition reasonably acceptable
to the Administrative Agent, and which receipts or bills of lading, in
any case, designate the Administrative Agent directly or by
endorsement as the only Person to which the warehouseman or carrier is
legally obligated to deliver such Inventory;
(e) none of such Inventory is in the possession of any Inventory Agent
unless (i) such Inventory Agent has been previously approved by the
Administrative Agent in writing, (ii) such Inventory is stored at a
location listed on Schedule III hereto and (iii) the Borrower has complied,
to the satisfaction of the Agents and their counsel, with the filing
requirements of Article 9 of the UCC with respect to such Inventory;
(f) none of such Inventory shall consist of pallets, bags or other
supplies; and
(g) none of such Inventory shall include Prepaid Inventory.
"Eligible Prepaid Inventory" means, with respect to the Borrower and any
Restricted Subsidiary, at the time of any determination thereof, any Prepaid
Inventory as to which each of the following requirements has been fulfilled to
the reasonable satisfaction of the Administrative Agent:
(a) such Prepaid Inventory must constitute Inventory when received;
17
(b) with respect to the Person to whom any payments were made by the
Borrower or any Restricted Subsidiary in connection with such Prepaid
Inventory, neither the Borrower nor any such Restricted Subsidiary is
indebted to such Person, unless the Borrower or such Restricted Subsidiary
and such Person have entered into an agreement whereby such Person is
prohibited from exercising any right of setoff with respect to the Prepaid
Inventory of the Borrower or such Restricted Subsidiary, provided, that in
any event, if such an agreement prohibiting setoff rights with respect to
any such Prepaid Inventory is not delivered by such Person, then only up to
the amount that the Borrower or such Restricted Subsidiary is indebted to
such Person with respect to such Prepaid Inventory shall be excluded as
Prepaid Inventory pursuant to this clause;
(c) any payments made by the Borrower or any Restricted Subsidiary in
connection with such Prepaid Inventory shall only be made to a Person
located within the United States, unless such Person's obligations (or that
portion of such obligations which is acceptable to the Administrative
Agent) with respect to such Prepaid Inventory are secured by a letter of
credit, guaranty or eligible bankers' acceptance having terms, and from
such issuers and confirmation banks, as are reasonably acceptable to the
Administrative Agent;
(d) such Prepaid Inventory shall not include Prepaid Inventory for
which the Borrower or any Restricted Subsidiary made a payment to:
(i) an Affiliate of the Borrower or any of its Restricted
Subsidiaries (other than any 399VP-related company which is deemed an
Affiliate solely by reason of 399VP's common ownership interest in
each of Parent and such 399VP-related company), or
(ii) a Person that is the subject of any reorganization,
bankruptcy, receivership, custodianship, insolvency or other condition
analogous with respect to such Person to those described in clauses
(a) through (d) of Section 8.1.9;
(e) any payments made by the Borrower or any Restricted Subsidiary in
connection with such Prepaid Inventory shall not be made to any Person
which has any obligation to the Borrower or any Restricted Subsidiary which
is more than thirty days past due; and
(f) any payments made by the Borrower or any Restricted Subsidiary in
connection with such Prepaid Inventory which have been disallowed by the
Administrative Agent, at the time of delivery of the first Borrowing Base
Certificate pursuant to clause (j) of Section 7.1.1 upon which such
payments appear, shall be excluded from Eligible Prepaid Inventory pursuant
to this clause.
18
"Eligible Rebate Receivables" means, with respect to the Borrower and any
Restricted Subsidiary, at the time of determination thereof, any Rebate
Receivable as to which each of the following requirements has been fulfilled to
the reasonable satisfaction of the Administrative Agent:
(a) the Administrative Agent has approved the methodology used by the
Borrower or any such Restricted Subsidiary in determining what constitutes
a Rebate Receivable;
(b) such Rebate Receivable is not a Deferred Rebate Receivable; and
(c) with respect to the Person under such Rebate Receivable, neither
the Borrower nor any such Restricted Subsidiary is indebted to such Person
(and such indebtedness is past due by the terms thereof), unless the
Borrower or such Restricted Subsidiary and such Person have entered into an
agreement whereby such Person is prohibited from exercising any right of
setoff with respect to the Rebate Receivables of the Borrower or such
Restricted Subsidiary, provided, that in any event, if such an agreement
prohibiting setoff rights with respect to any such Rebate Receivable is not
delivered by such Person, then only up to the amount that the Borrower or
such Restricted Subsidiary is indebted to such Person under such Rebate
Receivable shall be excluded from the value of such Eligible Rebate
Receivable dollar-for-dollar pursuant to this clause.
"Environmental Laws" means all applicable federal, state or local statutes,
laws, ordinances, codes, rules, regulations and guidelines (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment.
"Equalization Transfer" is defined in clause (b) of Section 2.8.
"Equity Investors" is defined in the first recital.
"Equity Issuances" is defined in clause (d) of the fourth recital.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto of similar import, together with
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections thereto.
"Event of Default" is defined in Section 8.1.
"Excess Availability" means, at any time of determination, the amount which
is
19
(a) the lesser of (i) the Revolving Loan Commitment Amount and (ii)
the then existing Borrowing Base Amount
less
(b) the aggregate outstanding principal amount of all Revolving Loans
and Swing Line Loans, together with the aggregate amount of all Letter of
Credit Outstandings.
"Exchange Act" means the Securities and Exchange Act of 1934, as amended.
"Existing Letters of Credit" means (a) the letter of credit no. SPL28308,
dated November 26, 1986, issued by ▇▇▇▇▇▇ Trust & Savings Bank to American
National Bank and Trust Company of Chicago in the stated amount of $3,672,603
(of which $2,203,562 is available as of the Closing Date) and (b) the letter of
credit issued by ▇▇▇▇▇▇ Trust & Savings Bank to Transamerica Company in an
approximate stated amount of $1,400,000 (of which approximately $300,000 is
available as of the Closing Date).
"Extended Term Accounts" means Accounts, which are not Crop Term Accounts,
as to which the Borrower grants certain Account Debtors extended payment terms
(i.e. greater than 30-day payment terms).
"Farmarkets Subsidiaries" means, collectively, (i) each of ▇▇▇▇▇▇▇-▇▇▇▇▇
Realty LLC, ▇▇▇▇▇▇▇-▇▇▇▇▇ AgriBusiness Realty LLC, ▇▇▇▇▇▇▇-▇▇▇▇▇ Nitrogen Realty
LLC and ▇▇▇▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇'▇ Realty LLC, each a Delaware limited liability
company and (ii) each other Subsidiary of the Borrower certified as a Farmarkets
Subsidiary by the Board of Directors of the Borrower, to which the Borrower and
certain of its Subsidiaries (including the IMC Businesses) will transfer Fixed
Assets to secure the First Mortgage Notes.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to
(a) 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
New York; or
(b) 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.
20
"Fee Letter" means the confidential fee letter, dated January 20, 1999,
among Parent, CVC, ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation and DLJ,
as amended, supplemented, amended and restated or otherwise modified from time
to time.
"Filing Agent" is defined in Section 5.1.9.
"Filing Statements" is defined in Section 5.1.9.
"First Mortgage Note Documents" means, collectively, the First Mortgage
Note Indenture, the Registration Rights Agreement, the Note Purchase Agreement
and each of the other loan agreements, indentures, note purchase agreements,
promissory notes, guarantees, and other instruments and agreements executed and
delivered in connection with the First Mortgage Note Offering, and evidencing
the terms of the First Mortgage Notes, as amended, supplemented, amended,
restated and otherwise modified from time to time in accordance with Section
7.2.10.
"First Mortgage Note Indenture" means the Indenture, dated as of April 22,
1999, among the Borrower, the guarantors party thereto and United States Trust
Company of New York, as Trustee, as the same may be amended, supplemented,
amended and restated or otherwise modified from time to time in accordance with
Section 7.2.10.
"First Mortgage Note Offering" is defined in clause (a) of the fourth
recital.
"First Mortgage Notes" means, the 10 1/4% First Mortgage Notes due 2009 of
the Borrower issued pursuant to the First Mortgage Note Offering and the First
Mortgage Note Indenture, and including any first mortgage notes of the Borrower
with substantially identical terms exchanged therefor pursuant to a registration
statement under the Securities Act of 1933, as amended.
"Fiscal Month" means any fiscal month of a Fiscal Year.
"Fiscal Quarter" means a quarter ending on the last day of March, June,
September or December of a Fiscal Year.
"Fiscal Year" means any period of twelve consecutive calendar months
ending on December 31; references to a Fiscal Year with a number corresponding
to any calendar year (e.g., "1998 Fiscal Year") refer to the Fiscal Year ending
on December 31 of such Fiscal Year.
"Fixed Assets" includes (a) the equity interests of each of the Farmarkets
Subsidiaries, (b) the real property, buildings, structures and other
improvements to any of the foregoing, of the Borrower and its Subsidiaries and
to the extent any of the following items of property constitute fixtures and/or
equipment under applicable laws, all fixtures, fittings, appliances, apparatus,
equipment, machinery, building and construction materials and other articles of
every kind and nature whatsoever and all replacements thereof, now or hereafter
21
affixed or attached to, placed upon or used in any way in connection with the
complete and comfortable use, enjoyment, occupation, operation, development
and/or maintenance of the real property of the Borrower or such Subsidiary or
such buildings, structures and other improvements and (c) any general
intangibles or other rights (including contract rights and intellectual
property) directly relating to the use and possession of any of the foregoing.
"Fixed Charge Coverage Ratio" means, at the close of any Fiscal Quarter,
the ratio computed for the period consisting of such Fiscal Quarter and each of
the three immediately prior Fiscal Quarters of:
(a) EBITDA for all such Fiscal Quarters,
less
(b) the sum of Capital Expenditures for all such Fiscal Quarters,
less
(c) the sum of Taxes paid in cash by the Borrower and its Restricted
Subsidiaries for all such Fiscal Quarters,
to
(d) the sum of Interest Expense paid in cash for all such Fiscal
Quarters; provided, that for the first three Fiscal Quarters ending after
the Closing Date, Interest Expense shall be determined on an Annualized
basis.
Notwithstanding the foregoing, for purposes of calculating the Fixed Charge
Coverage Ratio for the third Fiscal Quarter of the 1998 Fiscal Year, the fourth
Fiscal Quarter of the 1998 Fiscal Year and the first Fiscal Quarter of the 1999
Fiscal Year, the amount deducted pursuant to (i) clause (b) above shall be
deemed to be $7,919,000, $7,466,000 and $4,956,000, respectively and (ii) clause
(c) above shall be deemed to be -$10,755,000, -$7,038,000 and -$5,784,000,
respectively.
"Foreign Subsidiary" means a Subsidiary of the Borrower that is not a
Subsidiary incorporated or organized in or under the laws of the United States
or any State thereof.
"F.R.S. Board" means the Board of Governors of the Federal Reserve System
or any successor thereto.
"GAAP" is defined in Section 1.4.
"Governmental Authority" means the government of the United States of
America, any other nation or any political subdivision thereof, whether state or
22
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government.
"Hazardous Material" means
(a) any "hazardous substance" as defined by CERCLA; or
(b) any "hazardous waste" as defined by the Resource Conservation and
Recovery Act, as amended; or
(c) any pollutant or contaminant or hazardous or toxic chemical,
material or substance (including any petroleum product) within the meaning
of any other applicable federal, state or local law, regulation, ordinance
or requirement (including consent decrees and administrative orders)
relating to or imposing liability or standards of conduct concerning any
hazardous or toxic waste, substance or material, all as amended.
"Hedging Obligations" means, with respect to any Person, all liabilities of
such Person under currency exchange agreements, interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements, Commodity
Hedging Agreements, and all other agreements or arrangements designed to protect
such Person against fluctuations in interest rates, currency exchange rates or
commodity prices.
"herein", "hereof", "hereto", "hereunder" and similar terms contained in
this Agreement or any other Loan Document refer to this Agreement or such other
Loan Document, as the case may be, as a whole and not to any particular Section,
paragraph or provision of this Agreement or such other Loan Document.
"▇▇▇▇▇▇" is defined in the second recital.
"IMC Acquisition" is defined in the second recital.
"IMC AgriBusiness" is defined in the second recital.
"IMC Businesses" is defined in the second recital.
"IMC Nitrogen" is defined in the second recital.
"IMC Rollover Issuance" is defined in clause (d) of the fourth recital.
"Immaterial Subsidiary" means any Subsidiary of the Borrower which (a) is
restricted, pursuant to its Organic Documents, from executing the Subsidiary
Guaranty and (b)(i) accounted for less than 5% of EBITDA of the Borrower and its
23
Subsidiaries on a consolidated basis for the most recently completed Fiscal
Quarter with respect to which, pursuant to Section 7.1.1, financial statements
have been, or are required to have been, delivered by the Borrower on or before
the date as of which any such determination is made, as reflected in such
financial statements, and (ii) has assets which represent less than 5% of the
consolidated gross assets of the Borrower and its Subsidiaries as of the last
day of the most recently completed Fiscal Quarter with respect to which,
pursuant to Section 7.1.1, financial statements have been, or are required to
have been, delivered by the Borrower on or before the date as of which any such
determination is made, as reflected in such financial statements.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial statement
of any Obligor, any qualification or exception to such opinion or certification
(a) which is of a "going concern" or similar nature, (b) which relates to the
limited scope of examination of matters relevant to such financial statement, or
(c) which relates to the treatment or classification of any item in such
financial statement and which, as a condition to its removal, would require an
adjustment to such item the effect of which would be to cause such Obligor to be
in default of any of its obligations under Section 7.2.4.
"including" and "include" mean including without limiting the generality of
any description preceding such term, and, for purposes of this Agreement and
each other Loan Document, the parties hereto agree that the rule of ejusdem
generis shall not be applicable to limit a general statement, which is followed
by or referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
"Incur" is defined in Section 7.2.2.
"Indebtedness" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money or advances and
all obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;
(c) all Capitalized Lease Liabilities of such Person;
(d) net liabilities of such Person under all Hedging Obligations;
(e) whether or not so included as liabilities in accordance with GAAP,
all Indebtedness of the types referred to in clauses (a) through (c) above
(excluding prepaid interest thereon) secured by a Lien on property owned or
24
being purchased by such Person (including Indebtedness arising under
conditional sales or other title retention agreements), whether or not such
Indebtedness shall have been assumed by such Person or is limited in
recourse; provided, however, that, to the extent such Indebtedness is
limited in recourse to the assets securing such Indebtedness, the amount of
such Indebtedness shall be limited to the fair market value of such assets;
(f) all obligations arising under Synthetic Leases; and
(g) all Contingent Liabilities of such Person in respect of any of
the foregoing.
For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any other entity (including any partnership or joint venture
in which such Person is a general partner or a joint venturer) to the extent
such Person is liable for such Indebtedness as a result of such Person's
ownership interest in or other relationship with such entity, except to the
extent the terms of such Indebtedness provide that such Person is not liable
therefor.
"Indemnified Liabilities" is defined in Section 10.4.
"Indemnified Parties" is defined in Section 10.4.
"Intercreditor Agreement" means the Intercreditor Agreement executed and
delivered pursuant to the terms of this Agreement by the Administrative Agent
and the United States Trust Company of New York, as trustee under the First
Mortgage Note Indenture, and acknowledged by the Borrower, substantially in the
form of Exhibit I hereto, as amended, supplemented, amended and restated or
otherwise modified from time to time.
"Interest Coverage Ratio" means, at the close of any Fiscal Quarter, the
ratio computed for the period consisting of such Fiscal Quarter and each of the
three immediately prior Fiscal Quarters of:
(a) EBITDA for all such Fiscal Quarters
to
(b) the sum of Interest Expense paid in cash for all such Fiscal
Quarters; provided, that for the first three Fiscal Quarters ending after
the Closing Date, Interest Expense shall be determined on an Annualized
basis.
"Interest Expense" means, for any applicable period, the aggregate interest
expense of the Borrower and its Restricted Subsidiaries for such applicable
period, as determined in accordance with GAAP, including the portion of any
payments made in respect of Capitalized Lease Liabilities allocable to interest
expense.
25
"Interest Period" means, as to any LIBO Rate Loan, the period commencing on
(and including) the Borrowing date of such Loan or on the date on which the Loan
is converted into or continued as a LIBO Rate Loan, and ending on (but
excluding) the date one, two, three, six or nine months thereafter, or, if
available in the Administrative Agent's reasonable determination, two weeks or
twelve months thereafter as selected by the Borrower in its Borrowing Request or
its Continuation/Conversion Notice; provided, however, that:
(a) if any Interest Period would otherwise end on a day that is not a
Business Day, that Interest Period shall be extended to the following
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month, in which event such Interest
Period shall end on the preceding Business Day;
(b) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such Interest
Period;
(c) no Interest Period for any Loan shall extend beyond the Stated
Maturity Date for such Loan; and
(d) there shall be no more than 10 Interest Periods in effect at any
one time.
"Inventory" means, any "inventory" (as that term is defined in Section
9-109(4) of the UCC) of the Borrower or any Restricted Subsidiary.
"Inventory Agent" means any commission agent, third-party warehouseperson
or consigning agent which holds Inventory owned by the Borrower or any
Restricted Subsidiary for sale at such consigning agent's place of business.
"Investment" means, relative to any Person, (a) any loan or advance made by
such Person to any other Person (excluding commission, travel, relocation and
similar advances to officers, directors and employees made in the ordinary
course of business) or (b) any investment, contribution or similar transfer made
by such Person for purposes of acquiring or maintaining any ownership or similar
interest in another Person or a business of another Person (whether through the
ownership or acquisition of Capital Stock, revenues or profits or otherwise,
including by way of merger, consolidation or otherwise). The amount of any
Investment shall be the original principal or capital amount thereof less all
returns of principal or equity thereon (and without adjustment by reason of the
financial condition of such other Person) and shall, if made by the transfer or
exchange of property other than cash, be deemed to have been made in an original
principal or capital amount equal to the fair market value of such property at
the time of such transfer or exchange.
26
"Issuance Request" means a Letter of Credit request and certificate duly
executed by an Authorized Officer of the Borrower, in substantially the form of
Exhibit B-2 attached hereto.
"Issuer" means the Administrative Agent or an affiliate of the
Administrative Agent, in its capacity as Issuer of Letters of Credit and any
other Lender as may be designated by the Borrower (and consented to by the
Administrative Agent and such Lender, such consent by the Administrative Agent
not to be unreasonably withheld) in its capacity as Issuer of Letters of Credit.
"Lender Assignment Agreement" means a Lender Assignment Agreement
substantially in the form of Exhibit H hereto.
"Lenders" is defined in the preamble.
"Letter of Credit" is defined in Section 2.1.3.
"Letter of Credit Commitment" means, with respect to the Issuer, the
Issuer's obligation to issue Letters of Credit pursuant to clause (c) of Section
2.1.1 and, with respect to each of the other Lenders that has a Revolving Loan
Commitment, the obligation of each such Lender to participate in such Letters of
Credit pursuant to Section 2.6.1.
"Letter of Credit Commitment Amount" means, on any date, a maximum amount
of $10,000,000, as such amount may be reduced from time to time pursuant to
Section 2.2.
"Letter of Credit Outstandings" means, on any date, an amount equal to the
sum of
(a) the then aggregate amount which is undrawn and available under all
issued and outstanding Letters of Credit (whether or not the conditions to
drawing thereunder could be satisfied on such date),
plus
(b) the then aggregate amount of all unpaid and outstanding
Reimbursement Obligations in respect of such Letters of Credit.
"Leverage Ratio" means, at the end of any Fiscal Quarter, the ratio of:
(a) Total Debt outstanding at such time
to
(b) EBITDA for the period of four consecutive Fiscal Quarters ended on
such date.
27
"LIBO Rate" means, relative to any Interest Period for LIBO Rate Loans, the
rate per annum equal to the rate at which Dollar deposits are offered for such
Interest Period as set forth on, at the option of the Administrative Agent,
either the Reuters Screen LIBO Page or the Telerate Screen LIBO Page, in both
cases at or about 9:00 a.m. (Minnesota time), two Business Days prior to the
beginning of such Interest Period for delivery on the first day of such Interest
Period, and in an amount approximately equal to the amount of the LIBO Rate Loan
and for a period approximately equal to such Interest Period.
"LIBO Rate Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the LIBO Rate (Reserve Adjusted).
"LIBO Rate (Reserve Adjusted)" means, relative to any Loan to be made,
continued or maintained as, or converted into, a LIBO Rate Loan for any Interest
Period, the rate of interest per annum (rounded upwards to the next 1/16th of
1%) determined by the Administrative Agent as follows:
LIBO Rate
LIBO Rate = -------------------------------
(Reserve Adjusted) 1.00 - LIBOR Reserve Percentage
The LIBO Rate (Reserve Adjusted) for any Interest Period for LIBO Rate
Loans will be adjusted automatically as to all LIBO Rate Loans then outstanding
as of the effective date of any change in the LIBOR Reserve Percentage.
"LIBOR Office" means, relative to any Lender, the office of such Lender
designated as such on Schedule II hereto or designated in the Lender Assignment
Agreement pursuant to which such Lender became a Lender hereunder or such other
office of a Lender as shall be so designated from time to time by notice from
such Lender to the Borrower and the Administrative Agent, which shall be making
or maintaining LIBO Rate Loans of such Lender hereunder.
"LIBOR Reserve Percentage" means, relative to any Interest Period for LIBO
Rate Loans, the percentage (expressed as a decimal, rounded upward to the next
1/16th of 1%) in effect on such day (whether or not applicable to any Lender)
under regulations issued from time to time by the F.R.S. Board for determining
the maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency Liabilities" in Regulation D of the F.R.S. Board).
"Lien" means any security interest, mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or otherwise),
charge against or interest in property, or any filing or recording of any
instrument or document in respect of the foregoing, to secure payment of a debt
or performance of an obligation or any other priority or preferential treatment
of any kind or nature whatsoever that has the practical effect of creating a
security interest in property.
28
"Loan" means, as the context may require, a Revolving Loan of any type or a
Swing Line Loan.
"Loan Document" means this Agreement, the Notes, the Letters of Credit,
each Rate Protection Agreement, each Borrowing Request, each Issuance Request,
each Borrowing Base Certificate, the Fee Letter, the Administrative Agent's Fee
Letter, each Pledge Agreement, the Subsidiary Guaranty, and each other
agreement, document or instrument delivered in connection with this Agreement or
any other Loan Document, whether or not specifically mentioned herein or
therein.
"Management Investors" is defined in the first recital.
"Marketable Securities" means "marketable securities" as defined under
GAAP.
"Material Adverse Effect" means (a) a material adverse effect on the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower and its Subsidiaries, taken as a whole,
(b) a material impairment of the ability of the Borrower or any other Obligor to
perform its respective material obligations under the Loan Documents to which it
is or will be a party, or (c) an impairment of the validity or enforceability
of, or a material impairment of the rights, remedies or benefits available to
the Issuer, the Agents, the Co-Lead Arrangers or the Lenders under, this
Agreement or any other Loan Document.
"Monthly Payment Date" means the last day of each Fiscal Month, or, if any
such day is not a Business Day, the next succeeding Business Day.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"▇▇▇▇▇▇" is defined in the preamble.
"Net Asset Value" means, at any time of any determination thereof:
(a) with respect to Accounts, as reflected on the books of the
Borrower and its Restricted Subsidiaries in accordance with GAAP, an amount
equal to (i) 80% of the book value of all Eligible Accounts which are
Regular Accounts (provided that during the months of September, October and
November (the "Seasonal Period") the advance rate shall be 85%), plus (ii)
70% of all Eligible Accounts which are Crop Term Accounts or Extended Term
Accounts (provided that (A) the advance rate during the Seasonal Period
shall be 75% and (B) the aggregate amount of such Crop Term Accounts and
Extended Term Accounts shall be limited, before applying the relevant
advance rate, to those amounts specified on Schedule IV hereto), less (iii)
all credits, discounts, allowances (and net of all unissued credits in the
form of competitive allowances or otherwise) and other reserves deemed
appropriate by the Administrative Agent;
29
(b) with respect to Inventory, as reflected on the books of the
Borrower and its Restricted Subsidiaries in accordance with GAAP, an amount
equal to (i) 65% of the lesser of the market value and the cost of goods
(determined on a first-in, first-out basis) of all Eligible Inventory
(provided, that (A) the advance rate during the Seasonal Period shall be
70% and (B) that the aggregate amount of saleable equipment, applicators
and planter plates which, for purposes hereof, shall be deemed to be
Eligible Inventory, before applying the relevant advance rate, shall not
exceed $1,000,000); less (ii) all Customer Deposits and inventory reserves,
including reserves for inventory shrinkage, variances, capitalized
distribution costs, and other reserves as deemed appropriate by the
Administrative Agent;
(c) with respect to Rebate Receivables, as reflected on the books of
the Borrower and its Restricted Subsidiaries in accordance with GAAP, an
amount equal to 80% of all Eligible Rebate Receivables (provided, that (i)
the advance rate during the Seasonal Period shall be 85% and (ii) the
amount of such Eligible Rebate Receivables shall be limited, after applying
the relevant advance rate, to those amounts specified on Schedule IV
hereto); and
(d) with respect to Prepaid Inventory, as reflected on the books of
the Borrower and its Restricted Subsidiaries in accordance with GAAP, an
amount equal to 65% of Eligible Prepaid Inventory (provided, that (i) the
advance rate during the Seasonal Period shall be 70% and (ii) the amount of
such Eligible Prepaid Inventory shall be limited, after applying the
relevant advance rate, to those amounts specified on Schedule IV hereto).
"Net Casualty Proceeds" means, with respect to any Casualty Event, the
amount of any insurance proceeds or condemnation awards received by the Borrower
or any of its Restricted Subsidiaries in connection therewith, but excluding any
proceeds or awards required to be paid to a creditor (other than the Lenders)
which holds a first-priority Lien permitted by Section 7.2.3 on the property
which is the subject of such Casualty Event.
"Net Debt Proceeds" means, with respect to the incurrence, sale or issuance
by the Borrower or any of its Restricted Subsidiaries of any Debt (other than
Debt permitted by Section 7.2.2), the excess of:
(a) the gross cash proceeds received by the Borrower or any of its
Restricted Subsidiaries from such incurrence, sale or issuance,
less
(b) all reasonable and customary underwriting commissions and legal,
investment banking, brokerage and accounting and other professional fees,
sales commissions and disbursements and all other reasonable fees, expenses
and charges, in each case actually incurred in connection with such
incurrence, sale or issuance.
30
"Net Disposition Proceeds" means, with respect to any Disposition (other
than transfers made as part of the Transaction and other sales permitted
pursuant to clause (a) of Section 7.2.9), the excess of:
(a) the gross cash proceeds received by the Borrower or any of its
Restricted Subsidiaries from any such Disposition and any cash payments
received in respect of promissory notes or other non-cash consideration
delivered to the Borrower or such Restricted Subsidiary in respect thereof,
less
(b) the sum (without duplication) of (i) all reasonable and customary
fees and expenses with respect to legal, investment banking, brokerage,
accounting and other professional fees, sales commissions and disbursements
and all other reasonable fees, expenses and charges, in each case actually
incurred in connection with such Disposition, (ii) all Taxes and other
governmental costs and expenses actually paid or estimated by the Borrower
(in good faith) to be payable in cash in connection with such Disposition,
and (iii) payments made by the Borrower or any of its Restricted
Subsidiaries to retire Indebtedness (other than the Credit Extensions) of
the Borrower or any of its Restricted Subsidiaries where payment of such
Indebtedness is required in connection with such Disposition;
provided, however, that if, after the payment of all Taxes with respect to such
Disposition, the amount of estimated Taxes, if any, pursuant to clause (b)(ii)
above exceeded the Tax amount actually paid in cash in respect of such
Disposition, the aggregate amount of such excess shall be immediately payable,
pursuant to clause (d) of Section 3.1.1, as Net Disposition Proceeds.
"Net Equity Proceeds" means with respect to the sale or issuance by the
Borrower or any of its Restricted Subsidiaries to any Person of any of its
Capital Stock or any warrants or options with respect to its Capital Stock or
the exercise of any such warrants or options after the Closing Date, the excess
of:
(a) the gross cash proceeds received by such Person from such sale,
exercise or issuance,
less
(b) all reasonable and customary underwriting commissions and legal,
investment banking, brokerage, accounting and other professional fees,
sales commissions and disbursements and all other reasonable fees, expenses
and charges, in each case actually incurred in connection with such sale or
issuance.
31
"Net Income" means, for any period, the aggregate of all amounts which, in
accordance with GAAP, would be included as net income on the consolidated
financial statements of the Borrower and its Restricted Subsidiaries for such
period.
"Net Worth" means the consolidated net worth of the Borrower and its
Restricted Subsidiaries, determined in accordance with GAAP.
"Net Worth Amount" means the amount equal to
(a) for the quarterly period ending 06/30/00, the Base Net Worth less
$41,000,000 plus (only to the extent Net Income is in excess of zero) an
amount equal to 50% of the Net Income for the quarterly period from
04/01/00 to 06/30/00;
(b) for the quarterly period ending 09/30/00, the amount determined
pursuant to clause (a) above plus (only to the extent Net Income is in
excess of zero) an amount equal to 50% of the Net Income for the quarterly
period from 07/01/00 to 09/30/00;
(c) for the quarterly period ending 12/31/00, the amount determined
pursuant to clause (b) above plus (only to the extent Net Income is in
excess of zero) an amount equal to 50% of the Net Income for the quarterly
period from 10/01/00 to 12/31/00; and
(d) for the quarterly periods ending 03/31/01, 06/30/01, 09/30/01 and
12/31/01, the Net Worth Amount determined (in accordance with the method
set forth above) as of the prior quarterly period plus (only to the extent
Net Income is in excess of zero) an amount equal to 50% of the Net Income
for such quarterly period ending 03/31/01, 06/30/01, 09/30/01 or 12/31/01,
respectively.
"No Less Favorable Terms and Conditions" means, with respect to the First
Mortgage Note Refinancing or any other refinancing of the First Mortgage Notes
permitted hereunder, terms and conditions which are no less favorable to the
Agents and the Lenders and evidenced by documentation which shall not (i)
increase the principal amount of or interest rate on the outstanding
Indebtedness evidenced by the First Mortgage Notes, (ii) reduce either the tenor
or the average life of such Indebtedness, (iii) change the respective primary
obligor(s) on the refinancing Indebtedness as on the First Mortgage Notes, (iv)
change the security, if any, for the refinancing Indebtedness (except to the
extent that less security is granted to holders of such refinancing
Indebtedness) and (v) afford the holders of such refinancing Indebtedness other
covenants, defaults, rights or remedies, taken as a whole, more burdensome to
the obligor(s) than those contained in the First Mortgage Notes.
"Non-Excluded Taxes" means any Taxes other than net income and franchise
taxes imposed with respect to the Lender by a Governmental Authority under the
laws of which the Lender is organized or in which it maintains its applicable
lending office.
32
"Non-U.S. Lender" means any Lender (including each Assignee Lender) that is
not a "United States person", as defined under Section 7701(a)(30) of the Code.
"Note" means, as the context may require, a Revolving Note or a Swing Line
Note.
"Note Purchase Agreement" means the note purchase agreement, dated as of
April 15, 1999, between Parent, the Borrower, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation and ▇▇▇▇▇▇, as amended, supplemented, amended, restated
and otherwise modified from time to time in accordance with Section 7.2.10.
"Notice of Default" is defined in Section 9.9.
"Obligations" means all obligations (monetary or otherwise, whether
absolute or contingent, matured or unmatured) of the Borrower and each other
Obligor arising under or in connection with this Agreement and each other Loan
Document.
"Obligor" means Parent, the Borrower, each Restricted Subsidiary or any
other Person (other than any Agent, the Co-Lead Arrangers or any Lender)
obligated under any Loan Document.
"Offering Memorandum" means the offering memorandum of the Borrower, dated
April 15, 1999, prepared in connection with the offer and sale of the First
Mortgage Notes.
"Organic Document" means, relative to any Obligor (or any Immaterial
Subsidiary), as applicable, its certificate of incorporation, by-laws,
certificate of partnership, partnership agreement, certificate of formation,
limited liability agreement and all shareholder agreements, voting trusts and
similar arrangements to which such Obligor (or such Immaterial Subsidiary) is a
party applicable to any of its authorized shares of Capital Stock.
"Other Taxes" means any and all stamp, documentary or similar taxes, or any
other excise or property taxes or similar levies that arise on account of any
payment made or required to be made under any Loan Document or from the
execution, delivery, registration, recording or enforcement of any Loan
Document.
"Parent" is defined in the first recital.
"Parent Guaranty and Pledge Agreement" means the Pledge Agreement executed
and delivered by an Authorized Officer of Parent pursuant to clause (a) of
Section 5.1.8, substantially in the form of Exhibit F-1 hereto, as amended,
supplemented, amended and restated or otherwise modified from time to time.
"Participant" is defined in Section 10.11.2.
33
"Past Due" means, which respect to
(a) Regular Accounts, such Account is outstanding more than 90 days
past the original billing date for such Account;
(b) Crop Term Accounts, such Account is outstanding after the end of
the Crop Year in which such Account arose; and
(c) Extended Term Accounts, such Account is outstanding more than 30
days past the due date, which date shall be no later than 180 days past the
original billing date for such Account;
provided, however, that, with respect to any Account, the original billing date
for such Account shall be deemed to be the earlier of (i) the actual original
billing date and (ii) the date which is seven days from the date of the shipment
of the Inventory giving rise to such Account.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a "pension plan", as such term is defined in section
3(2) of ERISA, which is subject to Title IV of ERISA (other than a multiemployer
plan as defined in section 4001(a)(3) of ERISA), and to which the Borrower or
any corporation, trade or business that is, along with the Borrower, a member of
a Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under section 4069 of ERISA.
"Percentage" means, relative to any Lender, the applicable percentage
relating to Revolving Loans as set forth opposite its name on Schedule II hereto
under the applicable column heading or set forth in Lender Assignment
Agreement(s), as such percentage may be adjusted from time to time pursuant to
Lender Assignment Agreement(s) executed by such Lender and its Assignee
Lender(s) and delivered pursuant to Section 10.11.
"Permitted Acquisition" means an acquisition (whether pursuant to an
acquisition of Capital Stock, assets or otherwise) by the Borrower or any
Restricted Subsidiary from any Person of a business ("Target") in which the
following conditions are satisfied:
(a) immediately before and after giving effect to such acquisition, no
Default or Event of Default shall have occurred and be continuing or would
result therefrom (including under Section 7.2.1);
(b) subject to the proviso below, the Borrower shall have delivered
each of the following to the Agents:
34
(i) a Compliance Certificate for the period of four full Fiscal
Quarters immediately preceding such acquisition (prepared in good
faith and in a manner and using such methodology which is consistent
with the most recent financial statements delivered pursuant to
Section 7.1.1) giving pro forma effect to the consummation of such
acquisition and evidencing compliance with the covenants set forth in
Section 7.2.4 as of the end of the Fiscal Quarter most recently ended
for which a Compliance Certificate is delivered by the Borrower to the
Administrative Agent;
(ii) a certificate (prepared in good faith by the chief
accounting or financial Authorized Officer of the Borrower and in a
manner and using such methodology which is consistent with the most
recent financial projections delivered pursuant to clause (i) of
Section 7.1.1) setting forth financial projections (which shall be on
a monthly basis for the first 24 months following such Permitted
Acquisition and on a yearly basis thereafter) for the Borrower and its
Restricted Subsidiaries (and including Target), on a consolidated
basis, demonstrating that the monthly Excess Availability shall not,
at any time over the life of this Agreement, be less than $25,000,000;
and
(iii) a customary inspection of Target's receivables and
inventory (the "Acquired Borrowing Base Assets") (which shall have
been commenced within 10 Business Days of the Borrower instructing the
Administrative Agent (which instruction shall be given as promptly as
possible) to inspect such Acquired Borrowing Base Assets of Target)
and completed by the Administrative Agent as soon as reasonably
practicable using all reasonable efforts to complete such inspection
promptly in accordance with past practices, the scope and results of
which inspection shall be satisfactory in all respects to the Agents
to the extent necessary to determine compliance with clause (ii)
above;
provided, that, with respect to clauses (ii) and (iii) above, the Borrower
shall only be required to deliver such certificate and such inspection from
time to time to the extent (A) the value of any Acquired Borrowing Base
Assets acquired in connection with any one Investment or a series of
related or unrelated Investments constituting Permitted Acquisitions equals
or exceeds $5,000,000 (and, thereafter, in increments of $5,000,000 or
more) and (B) an inspection of such Acquired Borrowing Base Assets shall
not have previously been completed by the Administrative Agent (either
pursuant to clause (iii) above or in connection with a customary yearly
inspection performed by the Administrative Agent); and
(c) notwithstanding clause (a) of Section 7.2.12, the Borrower will
cause Target (if Target becomes a Restricted Subsidiary) to enter into an
agreement (on terms and conditions and pursuant to documentation reasonably
satisfactory to the Agents) prohibiting the creation or assumption of any
Lien upon Target's properties, revenues or assets, whether owned at the
35
time of such acquisition or thereafter acquired (other than any Lien (i)
created in favor of the Administrative Agent pursuant to a Loan Document
and (ii) permitted under Section 7.2.3).
"Person" means any natural person, corporation, partnership, firm,
association, trust, government, governmental agency, limited liability company
or any other entity, whether acting in an individual, fiduciary or other
capacity.
"Plan" means any Pension Plan or Welfare Plan.
"Pledge Agreement" means, as the context may require, any Pledge and
Security Agreement or the Parent Guaranty and Pledge Agreement.
"Pledge and Security Agreement" means, as the context may require, the
Borrower Pledge and Security Agreement or the Subsidiary Pledge and Security
Agreement.
"Prepaid Inventory" means prepaid expenses of the Borrower or any
Restricted Subsidiary for which the Borrower or such Restricted Subsidiary has
made payments to suppliers for the receipt of Inventory at a future date.
"Pro Forma Balance Sheet" is defined in clause (e) of Section 5.1.13.
"Product Supply Agreement" means the product supply agreements, each dated
as of April 22, 1999, between the IMC Kalium Ltd., IMC-Agrico Company and the
Borrower, as amended, supplemented, amended and restated and otherwise modified
from time to time in accordance with Section 7.2.10.
"Purchasing Lender" is defined in clause (e) of Section 2.8.
"Quarterly Payment Date" means the last day of each of March, June,
September and December, or, if any such day is not a Business Day, the next
succeeding Business Day.
"R-C Acquisition" is defined in the second recital.
"Rate Protection Agreement" means, collectively, any currency or interest
rate swap, cap, collar or similar agreement or arrangements designed to protect
against fluctuations in interest rates or currency exchange rates entered into
by the Borrower or any of its Restricted Subsidiaries under which the
counterparty to such agreement is (or at the time such Rate Protection Agreement
was entered into, was) a Lender or an Affiliate of a Lender.
"Rebate Receivables" means those rights to payment associated with vendor
rebate programs, which rights of payment accrue to the Borrower or any
Restricted Subsidiary.
36
"Refinancing" is defined in the fifth recital.
"Register" is defined in clause (b) of Section 2.7.
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of April 22, 1999, among Parent, the Borrower, the IMC Businesses, the
Farmarkets Subsidiaries, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation and
▇▇▇▇▇▇ as the same may be amended, supplemented, amended and restated or
otherwise modified from time to time in accordance with Section 7.2.10.
"Regular Accounts" means Accounts as to which the Borrower or any
Restricted Subsidiary grants 30 day payment terms to the Account Debtor.
"Reimbursement Obligation" is defined in Section 2.6.3.
"Reinstatement Date" is defined in Section 4.1.
"Related Fund" means, with respect to any Lender which is a fund that
invests in loans, any other fund that invests in loans and is controlled by the
same investment advisor as such Lender or by an Affiliate of such investment
advisor.
"Release" means a "release", as such term is defined in CERCLA.
"Replacement Lender" is defined in Section 4.11.
"Replacement Notice" is defined in Section 4.11.
"Required Lenders" means, at any time, Lenders having at least 51% of the
Revolving Loan Commitment Amount.
"Resource Conservation and Recovery Act" means the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901, et seq., as amended.
"Restricted Payment" means the declaration or payment of any dividend
(other than dividends payable solely in common stock of the Borrower or any
Restricted Subsidiary) on, or the making of any payment or distribution on
account of, or setting apart assets for a sinking or other analogous fund for,
the purchase, redemption, defeasance, retirement or other acquisition of any
class of Capital Stock (now or hereafter outstanding) of the Borrower or any
Restricted Subsidiary or any warrants or options to purchase any such Capital
Stock, whether now or hereafter outstanding, or the making of any other
distribution in respect thereof, either directly or indirectly, whether in cash,
property or obligations of the Borrower or any Restricted Subsidiary or
otherwise.
37
"Restricted Subsidiary" means any Subsidiary of the Borrower that is not a
Farmarkets Subsidiary or an Immaterial Subsidiary.
"Revolving Loan" is defined in Section 2.1.1.
"Revolving Loan Commitment" is defined in Section 2.1.1.
"Revolving Loan Commitment Amount" means, on any date, $275,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
"Revolving Loan Commitment Termination Date" means the earliest of (a) the
fifth anniversary of the Closing Date, (b) the date on which the Revolving Loan
Commitment Amount is terminated in full or reduced to zero pursuant to Section
2.2, and (c) the date on which any Commitment Termination Event occurs.
"Revolving Note" means a promissory note of the Borrower payable to any
Lender, substantially in the form of Exhibit A-1 hereto (as such promissory note
may be amended, endorsed or otherwise modified from time to time in accordance
with the terms hereof and thereof), evidencing the aggregate Indebtedness of the
Borrower to such Lender resulting from outstanding Revolving Loans, and also
means all other promissory notes accepted from time to time in substitution
therefor or renewal thereof.
"Rollover Equity Issuance" is defined in clause (c) of the fourth recital.
"S&P" means Standard & Poor's Ratings Services.
"Seasonal Period" is defined in clause (a) of the definition of "Net Asset
Value".
"Secured Parties" means, collectively, the Lenders, the Issuer, the Agents,
each counterparty to a Rate Protection Agreement and (in each case), each of
their respective successors, transferees and assigns.
"Seller Notes" is defined in clause (d) of the fourth recital.
"Selling Lender" is defined in clause (e) of Section 2.8.
"Senior Indebtedness" means the principal of, premium, if any, and interest
on any Indebtedness of the Borrower and its Restricted Subsidiaries, whether
outstanding on the date hereof or thereafter incurred as permitted herein,
unless, in the case of any particular Indebtedness, the agreement or instrument
creating or evidencing the same or pursuant to which the same is outstanding
expressly provides that such Indebtedness is junior or subordinated in right of
payment to any item of Indebtedness of the Borrower and its Restricted
Subsidiaries. Without limiting the generality of the foregoing, "Senior
38
Indebtedness" includes the principal of, premium, if any, and interest and all
other obligations of every nature of the Borrower (or any other Obligor) from
time to time owed pursuant to this Agreement or any other Loan Document.
Notwithstanding the foregoing, "Senior Indebtedness" does not include (a) in the
case of the obligation of the Borrower in respect of each Lender's obligations,
the obligation of the Borrower in respect of the other Lender's obligations, (b)
any liability for Taxes owed or owing by the Borrower or any of its Restricted
Subsidiaries to the extent that such liability constitutes Indebtedness, (c)
Indebtedness of the Borrower (or any other Obligor) to Parent, (d) that portion
of any Indebtedness which at the time of issuance is issued in violation hereof,
and (e) Indebtedness and amounts incurred in connection with obtaining goods,
materials or services in the ordinary course of business (other than such
Indebtedness which is owed to banks and other financial institutions or secured
by the goods or materials which were purchased with such Indebtedness).
"Solvency Certificate" means the solvency certificate delivered pursuant to
clause (b) of Section 5.1.10, substantially in the form of Exhibit J hereto.
"Solvent" means, with respect to any Person and its Subsidiaries on a
particular date, that on such date (a) the fair value of the property of such
Person and its Subsidiaries on a consolidated basis is greater than the total
amount of liabilities, including Contingent Liabilities, of such Person and its
Subsidiaries on a consolidated basis, (b) the present fair salable value of the
assets of such Person and its Subsidiaries on a consolidated basis, is not less
than the amount that will be required to pay the probable liability of such
Person and its Subsidiaries on a consolidated basis on its debts as they become
absolute and matured, (c) such Person does not intend to, and does not believe
that it or its Subsidiaries will, incur debts or liabilities beyond the ability
of such Person and its Subsidiaries to pay as such debts and liabilities mature,
and (d) such Person and its Subsidiaries on a consolidated basis are not engaged
in business or a transaction, and such Persons and its Subsidiaries on a
consolidated basis are not about to engage in business or a transaction, for
which the property of such Person and its Subsidiaries would constitute an
unreasonably small capital. The amount of Contingent Liabilities at any time
shall be computed as the amount that, in light of all the facts and
circumstances existing at such time, can reasonably be expected to become an
actual or matured liability.
"Stated Amount" of each Letter of Credit means the total amount available
to be drawn under such Letter of Credit upon the issuance thereof.
"Stated Expiry Date" is defined in Section 2.6.
"Stated Maturity Date" means, in the case of any Revolving Loan, the fifth
anniversary of the Closing Date or, if such day is not a Business Day, the first
Business Day following such day.
"Stock Purchase Agreement" means the Stock Purchase Agreement, dated as of
January 21, 1999 (as amended on April 13, 1999 and April 22, 1999), between
39
Parent, the Seller and The Vigoro Corporation, as amended, supplemented, amended
and restated and otherwise modified from time to time in accordance with Section
7.2.10.
"Subject Lender" is defined in Section 4.11.
"Subordinated Debt" means all unsecured Indebtedness for money borrowed
which is subordinated, upon terms and pursuant to documentation satisfactory to
the Agents and the Required Lenders, in right of payment to the payment in full
in cash of all Obligations.
"Subsidiary" means, with respect to any Person, any corporation,
partnership or other business entity of which more than 50% of the outstanding
Capital Stock (or other ownership interest) having ordinary voting power to
elect a majority of the board of directors, managers or other voting members of
the governing body of such entity (irrespective of whether at the time Capital
Stock (or other ownership interests) of any other class or classes of such
entity shall or might have voting power upon the occurrence of any contingency)
is at the time directly or indirectly owned or controlled by such Person, by
such Person and one or more other Subsidiaries of such Person, or by one or more
other Subsidiaries of such Person.
"Subsidiary Guaranty" means the Guaranty executed and delivered by an
Authorized Officer of each Restricted Subsidiary pursuant to Section 5.1.7,
substantially in the form of Exhibit G hereto, as amended, supplemented, amended
and restated or otherwise modified from time to time.
"Subsidiary Pledge and Security Agreement" means the Pledge Agreement
executed and delivered by an Authorized Officer of each Restricted Subsidiary
pursuant to clause (b) of Section 5.1.8, substantially in the form of Exhibit
F-3 hereto, as amended, supplemented, amended and restated or otherwise modified
from time to time.
"Swing Line Lender" means the Administrative Agent (or another Lender
designated by the Administrative Agent with the consent of the Borrower, if such
Lender agrees to be the Swing Line Lender hereunder), in such Person's capacity
as the maker of Swing Line Loans.
"Swing Line Loan" is defined in Section 2.1.1.
"Swing Line Loan Commitment" means, with respect to the Swing Line Lender,
the Swing Line Lender's obligation pursuant to Section 2.1.1 to make Swing Line
Loans and, with respect to each Lender with a Commitment to make Revolving Loans
(other than the Swing Line Lender), such Lender's obligation to participate in
Swing Line Loans pursuant to Section 2.3.2.
"Swing Line Loan Commitment Amount" means, on any date, $25,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2.
"Swing Line Note" means a promissory note of the Borrower payable to the
Swing Line Lender, in substantially the form of Exhibit A-2 hereto (as such
promissory note may be amended, endorsed or otherwise modified from time to
40
time), evidencing the aggregate Indebtedness of the Borrower to the Swing Line
Lender resulting from outstanding Swing Line Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.
"Syndication Agent" is defined in the preamble and includes each other
Person as shall have subsequently been appointed as the successor Syndication
Agent by the predecessor Syndication Agent and the Borrower.
"Synthetic Lease" means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) (a) that is not a capital lease in accordance
with GAAP and (b) in respect of which the lessee retains or obtains ownership of
the property so leased for federal income tax purposes, other than any such
lease under which that Person is the lessor.
"Target" is defined in the definition of "Permitted Acquisition".
"Taxes" means any and all income, stamp or other taxes, duties, levies,
imposts, charges, fees, deductions or withholdings, now or hereafter imposed,
levied, collected, withheld or assessed by any Governmental Authority, and all
interest, penalties or similar liabilities with respect thereto.
"Telerate Screen LIBO Page" means the display designated as "Page 3750" on
the Telerate Service (or such other page as may replace Page 3750 on the service
or such other service as may be nominated by the British Bankers' Association as
the information vendor for the purpose of displaying British Bankers'
Association interest settlement rates for Dollar deposits).
"Termination Date" means the date on which all Obligations have been paid
in full in cash, all Letters of Credit have been terminated, expired or Cash
Collateralized, all Rate Protection Agreements have been terminated and all
Commitments have been terminated.
"Total Debt" means, on any date, the outstanding principal amount of all
Indebtedness of the Borrower and its Restricted Subsidiaries of the type
referred to in clause (a) (which, in the case of the Loans, shall be deemed to
equal the average monthly amount of Loans outstanding on the last day of each
month during the Fiscal Quarter ending on or immediately preceding the date of
determination), clause (b) (which, in the case of Letter of Credit Outstandings
shall be deemed to equal the average monthly amount of Letter of Credit
Outstandings on the last day of each month during the Fiscal Quarter ending on
or immediately preceding the date of determination), clause (c), clause (e) and
clause (f), in each case of the definition of "Indebtedness" (exclusive of
intercompany Indebtedness between the Borrower and its Restricted Subsidiaries)
and (without duplication) any Contingent Liability in respect of any of the
foregoing.
"Transaction" is defined in the fifth recital.
41
"Transaction Documents" means, collectively, the Stock Purchase Agreement,
the First Mortgage Note Documents, the Product Supply Agreement, and all other
material agreements, documents, instruments, certificates, filings, consents,
approvals, board of directors resolutions and opinions furnished to or in
connection with the Transaction.
"type" means, relative to any Revolving Loan, the portion thereof, if any,
being maintained as a Base Rate Loan or a LIBO Rate Loan.
"UCC" means the Uniform Commercial Code as in effect from time to time in
the State of New York or, with respect to Filing Statements, the Uniform
Commercial Code as in effect from time to time in each applicable jurisdiction
of the United States.
"United States" or "U.S." means the United States of America, its fifty
States and the District of Columbia.
"Waiver" means any agreement in favor of the Administrative Agent for the
benefit of the Lenders and each Issuer in form and substance reasonably
satisfactory to the Administrative Agent.
"Welfare Plan" means a "welfare plan", as such term is defined in section
3(1) of ERISA.
"wholly-owned Subsidiary" means, with respect to any Person, any Subsidiary
of such Person all of the Capital Stock (including all rights and options to
purchase such Capital Stock) of which, other than directors' qualifying shares,
are owned, beneficially and of record, by such Person and/or one or more
wholly-owned Subsidiaries of such Person.
SECTION 1.2. Use of Defined Terms. Unless otherwise defined or the context
otherwise requires, terms for which meanings are provided in this Agreement
shall have such meanings when used in the Disclosure Schedule, each Loan
Document, notice and other communication delivered from time to time in
connection with this Agreement or any other Loan Document.
SECTION 1.3. Cross-References. Unless otherwise specified, references in
this Agreement and in each other Loan Document to any Article or Section are
references to such Article or Section of this Agreement or such other Loan
Document, as the case may be, and, unless otherwise specified, references in any
Article, Section or definition to any clause are references to such clause of
such Article, Section or definition.
SECTION 1.4. Accounting and Financial Determinations. Unless otherwise
specified, all accounting terms used herein or in any other Loan Document shall
be interpreted, all accounting determinations and computations hereunder or
thereunder (including under Section 7.2.4) shall be made, and all financial
statements required to be delivered hereunder or thereunder shall be prepared in
accordance with, those generally accepted accounting principles ("GAAP") applied
in the preparation of the financial statements referred to in Section 5.1.13.
Unless otherwise expressly provided, all financial covenants and defined
financial terms shall be computed on a consolidated basis for the Borrower and
its Restricted Subsidiaries, in each case without duplication.
42
ARTICLE II
COMMITMENTS, BORROWING PROCEDURES,
NOTES AND LETTERS OF CREDIT
SECTION 2.1. Commitments. On the terms and subject to the conditions of
this Agreement,
(a) each Lender severally agrees to make Revolving Loans (other than
Swing Line Loans) pursuant to the Revolving Loan Commitment, and the Swing
Line Lender agrees to make Swing Line Loans pursuant to the Swing Line Loan
Commitment, in each case as described in this Section 2.1; and
(b) the Issuer agrees that it will issue Letters of Credit pursuant to
Section 2.1.1, and each other Lender that has a Revolving Loan Commitment
severally agrees that it will purchase participation interests in such
Letters of Credit pursuant to Section 2.6.1.
SECTION 2.1.1. Credit Extensions. Subject to compliance by the Borrower
with the terms hereof, from time to time on any Business Day occurring from and
after the Closing Date but prior to the Revolving Loan Commitment Termination
Date:
(a) each Lender will make loans (relative to such Lender, its
"Revolving Loans") to the Borrower equal to such Lender's Percentage of the
aggregate amount of the Borrowing or Borrowings of Revolving Loans
requested by the Borrower to be made on such day. On the terms and subject
to the conditions set forth herein, the Borrower may from time to time
borrow, prepay and reborrow Revolving Loans. The Commitment of each Lender
described in this Section 2.1.1 is herein referred to as its "Revolving
Loan Commitment";
(b) the Swing Line Lender will make Loans (relative to the Swing
Line Lender, its "Swing Line Loans") to the Borrower equal to the
principal amount of the Swing Line Loans requested by the Borrower to be
made on such day. On the terms and subject to the conditions hereof, the
Borrower may from time to time borrow, prepay and reborrow such Swing Line
Loans;
(c) the Issuer will issue one or more standby letters of credit
(each referred to as a "Letter of Credit") for the account of the Borrower
or any Restricted Subsidiary in the Stated Amount requested by the
Borrower on such day, or extend the Stated Expiry Date of an existing
standby Letter of Credit previously issued hereunder to a date not later
than the earlier of (i) the Revolving Loan Commitment Termination Date and
(ii) one year from the date of such extension; it being acknowledged and
agreed by the parties hereto that the Existing Letters of Credit are each
deemed to be and shall constitute a "Letter of Credit" issued under and
43
governed by the terms of this Agreement, and ▇▇▇▇▇▇ Trust & Savings Bank
is deemed to be an "Issuer" under the terms of this Agreement with respect
to the Existing Letters of Credit.
SECTION 2.1.2. Lenders Not Permitted or Required to Make Loans. No Lender
shall be permitted or required to, and the Borrower shall not request any Lender
to, make any Revolving Loan or Swing Line Loan if, after giving effect thereto,
the aggregate outstanding principal amount of all the Revolving Loans and Swing
Line Loans
(a) of all the Lenders, together with the aggregate amount of all
Letter of Credit Outstandings, would exceed the lesser of (i) the Revolving
Loan Commitment Amount and (ii) the then existing Borrowing Base Amount;
(b) of such Lender (other than the Swing Line Lender), together with
such Lender's Percentage of the aggregate amount of all Letter of Credit
Outstandings, would exceed such Lender's Percentage of the lesser of (i)
the Revolving Loan Commitment Amount and (ii) the then existing Borrowing
Base Amount; or
(c) in the case of Swing Line Loans, if after giving effect to the
making of such Swing Line Loan, the outstanding principal amount of all
Swing Line Loans would exceed the then existing Swing Line Loan Commitment
Amount.
SECTION 2.1.3. Issuer Not Permitted or Required to Issue Letters of Credit.
No Issuer shall be permitted or required to issue any Letter of Credit if, after
giving effect thereto, (a) the aggregate amount of all Letter of Credit
Outstandings would exceed the Letter of Credit Commitment Amount or (b) the sum
of the aggregate amount of all Letter of Credit Outstandings plus the aggregate
principal amount of all Revolving Loans and Swing Line Loans then outstanding
would exceed the lesser of (i) the Revolving Loan Commitment Amount and (ii) the
then existing Borrowing Base Amount.
SECTION 2.2. Reduction of Commitment Amounts. The Commitment Amounts are
subject to reduction from time to time pursuant to this Section 2.2.
SECTION 2.2.1. Optional. The Borrower may, from time to time on any
Business Day occurring after the Closing Date, voluntarily reduce the Swing Line
Loan Commitment Amount, the Letter of Credit Commitment Amount or the Revolving
Loan Commitment Amount; provided, however, that all such reductions shall
require at least five Business Days' prior notice to the Administrative Agent
and be permanent, and any partial reduction of any Commitment Amount shall be in
a minimum amount of $5,000,000 and in an integral multiple of $1,000,000. Any
reduction of the Revolving Loan Commitment Amount which reduces the Revolving
Loan Commitment Amount below the sum of (a) the Letter of Credit Commitment
Amount and (b) the Swing Line Loan Commitment Amount shall result in an
44
automatic and corresponding reduction of the Letter of Credit Commitment Amount
and/or the Swing Line Loan Commitment Amount (as specified by the Borrower) to
an aggregate amount not in excess of the Revolving Loan Commitment Amount, as so
reduced, without any further action on the part of the Issuer or the Swing Line
Lender.
SECTION 2.2.2. Mandatory. The Revolving Loan Commitment Amount shall,
without any further action, automatically and permanently be reduced on the
Revolving Loan Commitment Termination Date so that the Revolving Loan Commitment
Amount equals $0, provided, that any such reduction of the Revolving Loan
Commitment Amount which reduces the Revolving Loan Commitment Amount below the
sum of (a) Letter of Credit Commitment Amount and (b) the Swing Line Loan
Commitment Amount shall result in an automatic and corresponding reduction of
the Letter of Credit Commitment Amount and/or the Swing Line Loan Commitment
Amount (as specified by the Borrower) to an aggregate amount not in excess of
the Revolving Loan Commitment Amount, as so reduced, without any further action
on the part of the Issuer or the Swing Line Lender.
SECTION 2.3. Borrowing Procedures and Funding Maintenance. Revolving Loans
shall be made by the Lenders in accordance with Section 2.3.1, and Swing Line
Loans shall be made by the Swing Line Lender in accordance with Section 2.3.2.
SECTION 2.3.1. Revolving Loans. In the case of Revolving Loans, by
delivering a Borrowing Request to the Administrative Agent on or before 11:00
a.m., Denver, Colorado time, on a Business Day, the Borrower may from time to
time irrevocably request, on not less than one Business Day's notice (in the
case of Base Rate Loans) or three Business Days' notice (in the case of LIBO
Rate Loans), that a Borrowing be made in a minimum aggregate amount of
$5,000,000 or any larger integral multiple of $1,000,000 or in the unused amount
of the Revolving Loan Commitment Amount. The Administrative Agent shall make
such funds available by transfer to or for the accounts of the Borrower on the
Business Day specified in the Borrowing Request (to the extent such Borrowing
Request was delivered on time pursuant to the terms hereof).
SECTION 2.3.2. Swing Line Loans. By telephonic notice (given by those
Persons authorized in writing by the Borrower to give such telephonic notice to
the Swing Line Lender and Administrative Agent), promptly followed (within one
Business Day) by the delivery of a confirming Borrowing Request, to the Swing
Line Lender and the Administrative Agent on or before 11:00 a.m., Denver,
Colorado time, on the Business Day the proposed Swing Line Loan is to be made,
the Borrower may from time to time irrevocably request that a Swing Line Loan be
made by the Swing Line Lender in any principal amount. All Swing Line Loans
shall be made as Base Rate Loans and shall not be entitled to be converted into
LIBO Rate Loans. The making of any such Swing Line Loan shall be conclusively
presumed to have been made to or for the benefit of the Borrower when the Swing
Line Lender and the Administrative Agent each believe in good faith that the
telephonic notice has been made by an authorized Person representing the
Borrower, or when such Swing Line Loan is deposited to the credit of the account
of the Borrower regardless of the fact that Persons other than those authorized
hereunder may have authority to draw against such account. The Administrative
45
Agent shall make such funds available by transfer to or for the accounts of the
Borrower on the same Business Day such telephonic notice shall have been
received.
SECTION 2.4. Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice to the Administrative Agent on or before 11:00
a.m., Denver, Colorado time, on a Business Day, the Borrower may from time to
time irrevocably elect, on not less than one Business Day's notice (in the case
of a conversion of LIBO Rate Loans to Base Rate Loans) or three Business Days'
notice (in the case of a continuation of LIBO Rate Loans or a conversion of Base
Rate Loans into LIBO Rate Loans) nor more than five Business Days' notice (in
the case of any Loans) that all, or any portion in a minimum aggregate amount of
$5,000,000 or an integral multiple of $1,000,000, of any Loans be, in the case
of Base Rate Loans, converted into LIBO Rate Loans or, in the case of LIBO Rate
Loans, converted into Base Rate Loans or continued as LIBO Rate Loans (in the
absence of delivery of a Continuation/Conversion Notice with respect to any LIBO
Rate Loan at least three Business Days (but not more than five Business Days)
before the last day of the then current Interest Period with respect thereto,
such LIBO Rate Loan shall, on such last day, automatically convert to a Base
Rate Loan); provided, however, that (a) each such conversion or continuation
shall be pro rated among the applicable outstanding Loans of all Lenders, and
(b) no portion of the outstanding principal amount of any Loans may be continued
as, or be converted into, LIBO Rate Loans when any Default has occurred and is
continuing.
SECTION 2.5. Funding. Each Lender may, if it so elects, fulfill its
obligation to make, continue or convert LIBO Rate Loans hereunder by causing one
of its foreign branches or Affiliates (or an international banking facility
created by such Lender) to make or maintain such LIBO Rate Loan; provided,
however, that such LIBO Rate Loan shall nonetheless be deemed to have been made
and to be held by such Lender, and the obligation of the Borrower to repay such
LIBO Rate Loan shall nevertheless be to such Lender for the account of such
foreign branch, Affiliate or international banking facility. In addition, the
Borrower hereby consents and agrees that, for purposes of any determination to
be made for purposes of Section 4.1, 4.2, 4.3 or 4.4, it shall be conclusively
assumed that each Lender elected to fund all LIBO Rate Loans by purchasing
Dollar deposits in its LIBOR Office's interbank Eurodollar market.
SECTION 2.6. Issuance Procedures. By delivering to the Administrative Agent
an Issuance Request on or before 11:00 a.m., Denver, Colorado time, on a
Business Day, the Borrower may, from time to time irrevocably request, on not
less than three nor more than ten Business Days' notice (or such shorter or
longer notice as may be acceptable to the Issuer), in the case of an initial
issuance of a Letter of Credit, and not less than three nor more than ten
Business Days' notice (unless a shorter or longer notice period is acceptable to
the Issuer) prior to the then existing Stated Expiry Date of a Letter of Credit,
in the case of a request for the extension of the Stated Expiry Date of a Letter
of Credit, that the Issuer issue, or extend the Stated Expiry Date of, as the
case may be, an irrevocable Letter of Credit on behalf of the Borrower (whether
issued for the account of or on behalf of the Borrower or any of its Restricted
Subsidiaries) in such form as may be requested by the Borrower and approved by
the Issuer, for the purposes described in Section 7.1.8; provided, however, that
no extension of the Stated Expiry Date of an outstanding Letter of Credit may
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provide for a Stated Expiry Date subsequent to the earlier of (a) the Revolving
Loan Commitment Termination Date and (b) one year from the date of such
extension. Notwithstanding anything to the contrary contained herein or in any
separate application for any Letter of Credit, the Borrower hereby acknowledges
and agrees that it shall be obligated to reimburse the Issuer upon each
Disbursement paid under a Letter of Credit, and it shall be deemed to be the
obligor for purposes of each such Letter of Credit issued hereunder (whether the
account party on such Letter of Credit is the Borrower or a Restricted
Subsidiary). Upon receipt of an Issuance Request, the Administrative Agent shall
promptly notify the Issuer and each Lender thereof. Each Letter of Credit shall
by its terms be stated to expire on a date (its "Stated Expiry Date") no later
than the earlier to occur of (a) the Revolving Loan Commitment Termination Date
or (b) one year from the date of its issuance.
SECTION 2.6.1. Other Lenders' Participation. Upon the issuance of each
Letter of Credit issued by the Issuer pursuant hereto, and without further
action, each Lender (other than the Issuer) that has a Revolving Loan Commitment
shall be deemed to have irrevocably purchased from the Issuer, to the extent of
its Percentage in respect of Revolving Loans, and the Issuer shall be deemed to
have irrevocably granted and sold to such Lender a participation interest in
such Letter of Credit (including the Contingent Liability and any Reimbursement
Obligation and all rights with respect thereto), and such Lender shall, to the
extent of its Percentage in respect of Revolving Loans, be responsible for
reimbursing promptly (and in any event within one Business Day) the Issuer for
Reimbursement Obligations which have not been reimbursed by the Borrower in
accordance with Section 2.6.3. In addition, such Lender shall, to the extent of
its Percentage in respect of Revolving Loans, be entitled to promptly receive a
ratable portion of the Letter of Credit fees payable pursuant to Section 3.3.3
with respect to each Letter of Credit and of interest payable pursuant to
Section 3.2 with respect to any Reimbursement Obligation. To the extent that any
Lender has reimbursed the Issuer for a Disbursement as required by this Section,
such Lender shall be entitled to receive its ratable portion of any amounts
subsequently received (from the Borrower or otherwise) in respect of such
Disbursement.
SECTION 2.6.2. Disbursements; Conversion to Revolving Loans. The Issuer
will notify the Borrower and the Administrative Agent promptly (but in any event
on the same Business Day) of the presentment for payment of any drawing under
any Letter of Credit issued by the Issuer, together with notice of the date (the
"Disbursement Date") such payment shall be made (each such payment, a
"Disbursement"). Subject to the terms and provisions of such Letter of Credit,
the Issuer shall make such payment to the beneficiary (or its designee) of such
Letter of Credit. Prior to 11:00 a.m., Denver, Colorado time, on the Business
Day following the Disbursement Date (the "Disbursement Due Date"), the Borrower
will reimburse the Administrative Agent, for the account of the Issuer, for all
amounts which the Issuer has disbursed under such Letter of Credit, together
with interest thereon at the rate per annum otherwise applicable to Revolving
Loans (made as Base Rate Loans) from and including the Disbursement Date to but
excluding the Disbursement Due Date and, thereafter (unless such Disbursement is
converted into a Base Rate Loan on the Disbursement Due Date), at a rate per
annum equal to the rate per annum then in effect with respect to overdue
Revolving Loans (made as Base Rate Loans) pursuant to Section 3.2.2 for the
period from the Disbursement Due Date through but excluding the date of such
reimbursement; provided, however, that if no Default shall have then occurred
47
and be continuing, unless the Borrower has notified the Administrative Agent no
later than one Business Day prior to the Disbursement Due Date that it will
reimburse the Issuer for the applicable Disbursement, then the amount of the
Disbursement shall be deemed to be a Borrowing of Revolving Loans constituting
Base Rate Loans and following the giving of notice thereof by the Administrative
Agent to the Lenders, each Lender with a Revolving Loan Commitment (other than
the Issuer) will deliver to the Issuer on the Disbursement Due Date immediately
available funds in an amount equal to such Lender's Percentage of such
Borrowing. Each conversion of Disbursement amounts into Revolving Loans shall
constitute a representation and warranty by the Borrower that on the date of the
making of such Revolving Loans all of the statements set forth in Section 5.2.1
are true and correct.
SECTION 2.6.3. Reimbursement. The obligation (a "Reimbursement Obligation")
of the Borrower under Section 2.6.2 to reimburse the Issuer with respect to each
Disbursement (including interest thereon) not converted into a Base Rate Loan
pursuant to Section 2.6.2, and, upon the Borrower failing or electing not to
reimburse the Issuer and the giving of notice thereof by the Administrative
Agent to the Lenders, each Lender's (to the extent it has a Revolving Loan
Commitment) obligation under Section 2.6.1 to reimburse the Issuer or fund its
Percentage of any Disbursement converted into a Base Rate Loan, shall be
absolute and unconditional under any and all circumstances and irrespective of
any setoff, counterclaim or defense to payment which the Borrower or such
Lender, as the case may be, may have or have had against the Issuer or any such
Lender, including any defense based upon the failure of any Disbursement to
conform to the terms of the applicable Letter of Credit (if, in the Issuer's
good faith opinion, such Disbursement is determined to be appropriate) or any
non-application or misapplication by the beneficiary of the proceeds of such
Letter of Credit; provided, however, that after paying in full its Reimbursement
Obligation hereunder, nothing herein shall adversely affect the right of the
Borrower or such Lender, as the case may be, to commence any proceeding against
the Issuer for any wrongful Disbursement made by the Issuer under a Letter of
Credit as a result of acts or omissions constituting gross negligence or willful
misconduct on the part of the Issuer.
SECTION 2.6.4. Deemed Disbursements. Upon the occurrence and during the
continuation of any Event of Default of the type described in clauses (a)
through (d) of Section 8.1.9 or, with notice from the Administrative Agent
acting at the direction of the Required Lenders, upon the occurrence and during
the continuation of any other Event of Default,
(a) an amount equal to that portion of all Letter of Credit
Outstandings attributable to the then aggregate amount which is undrawn and
available under all Letters of Credit issued and outstanding shall, without
demand upon or notice to the Borrower or any other Person, be deemed to
have been paid or disbursed by the Issuer under such Letters of Credit
(notwithstanding that such amount may not in fact have been so paid or
disbursed); and
(b) the Borrower shall be immediately obligated to reimburse the
Issuer for the amount deemed to have been so paid or disbursed by the
Issuer.
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Any amounts so payable by the Borrower pursuant to this Section shall be
deposited in cash with the Administrative Agent and held as collateral security
for the Obligations in connection with the Letters of Credit issued by the
Issuer. At such time as the Events of Default giving rise to the deemed
disbursements hereunder shall have been cured or waived, or any Letters of
Credit shall have expired undrawn, the Administrative Agent shall return to the
Borrower all amounts then on deposit with the Administrative Agent pursuant to
this Section, together with accrued interest at the Federal Funds Rate, which
have not been applied to the satisfaction of such Obligations.
SECTION 2.6.5. Nature of Reimbursement Obligations. The Borrower and, to
the extent set forth in Section 2.6.1, each Lender with a Revolving Loan
Commitment, shall assume all risks of the acts, omissions or misuse of any
Letter of Credit by the beneficiary thereof. The Issuer (except to the extent of
its own gross negligence or willful misconduct) shall not be responsible for (a)
the form, validity, sufficiency, accuracy, genuineness or legal effect of any
Letter of Credit or any document submitted by any party in connection with the
application for and issuance of a Letter of Credit, even if it should in fact
prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent
or forged, (b) the form, validity, sufficiency, accuracy, genuineness or legal
effect of any instrument transferring or assigning or purporting to transfer or
assign a Letter of Credit or the rights or benefits thereunder or the proceeds
thereof in whole or in part, which may prove to be invalid or ineffective for
any reason, (c) failure of the beneficiary to comply fully with conditions
required in order to demand payment under a Letter of Credit, (d) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, or (e) any loss or delay in the
transmission or otherwise of any document or draft required in order to make a
Disbursement under a Letter of Credit. None of the foregoing shall affect,
impair or prevent the vesting of any of the rights or powers granted to the
Issuer or any Lender with a Revolving Loan Commitment hereunder. In furtherance
and extension and not in limitation or derogation of any of the foregoing, any
action taken or omitted to be taken by the Issuer in good faith (and not
constituting gross negligence or willful misconduct) shall be binding upon the
Borrower, each Obligor and each such Lender, and shall not put the Issuer under
any resulting liability to the Borrower, any Obligor or any such Lender, as the
case may be.
SECTION 2.7. Register; Notes. (a) Each Lender may maintain in accordance
with its usual practice an account or accounts evidencing the Indebtedness of
the Borrower to such Lender resulting from each Loan made by such Lender,
including the amounts of principal and interest payable and paid to such Lender
from time to time hereunder. In the case of a Lender that does not request,
pursuant to clause (b)(ii) below, execution and delivery of a Note evidencing
the Loans made by such Lender to the Borrower, such account or accounts shall,
to the extent not inconsistent with the notations made by the Administrative
Agent in the Register, be conclusive and binding on the Borrower absent manifest
error; provided, however, that the failure of any Lender to maintain such
account or accounts shall not limit or otherwise affect any Obligations of the
Borrower or any other Obligor.
(b)(i) The Borrower hereby designates the Administrative Agent to serve as
the Borrower's agent, solely for the purpose of this clause (b), to maintain a
register (the "Register") on which the Administrative Agent will record each
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Lender's Commitment, the Loans made by each Lender and each repayment in respect
of the principal amount of the Loans of each Lender and annexed to which the
Administrative Agent shall retain a copy of each Lender Assignment Agreement
delivered to the Administrative Agent pursuant to Section 10.11.1. Failure to
make any recordation, or any error in such recordation, shall not affect the
Borrower's obligation in respect of such Loans. The entries in the Register
shall be conclusive, in the absence of manifest error, and the Borrower, the
Administrative Agent and the Lenders shall treat each Person in whose name a
Loan (and as provided in clause (ii) the Note evidencing such Loan, if any) is
registered as the owner thereof for all purposes of this Agreement,
notwithstanding notice or any provision herein to the contrary. A Lender's
Commitment and the Loans made pursuant thereto may be assigned or otherwise
transferred in whole or in part only by registration of such assignment or
transfer in the Register. Any assignment or transfer of a Lender's Commitment or
the Loans made pursuant thereto shall be registered in the Register only upon
delivery to the Administrative Agent of a Lender Assignment Agreement duly
executed by the Assignor Lender thereof. No assignment or transfer of a Lender's
Commitment or the Loans made pursuant thereto shall be effective unless such
assignment or transfer shall have been recorded in the Register by the
Administrative Agent as provided in this Section 2.7.
(ii) The Borrower agrees that, upon the written request to the
Administrative Agent by any Lender, the Borrower will execute and deliver to
such Lender, as applicable, a Note evidencing the Loans made by such Lender. The
Borrower hereby irrevocably authorizes each Lender to make (or cause to be made)
appropriate notations on the grid attached to such Lender's Notes (or on any
continuation of such grid), which notations, if made, shall evidence, inter
alia, the date of, the outstanding principal amount of, and the interest rate
and Interest Period applicable to the Loans evidenced thereby. Such notations
shall, to the extent not inconsistent with the notations made by the
Administrative Agent in the Register, be conclusive and binding on the Borrower
absent manifest error; provided, however, that the failure of any Lender to make
any such notations shall not limit or otherwise affect any Obligations of the
Borrower or any other Obligor. The Loans evidenced by any such Note and interest
thereon shall at all times (including after assignment pursuant to Section
10.11.1) be payable to the order of the payee named therein and its registered
assigns. Subject to the provisions of Section 10.11.1, a Note and the obligation
evidenced thereby may be assigned or otherwise transferred in whole or in part
only by registration of such assignment or transfer of such Note and the
obligation evidenced thereby in the Register (and each Note shall expressly so
provide). Any assignment or transfer of all or part of an obligation evidenced
by a Note shall be registered in the Register only upon surrender for
registration of assignment or transfer of the Note evidencing such obligation,
accompanied by a Lender Assignment Agreement duly executed by the assignor
thereof and the compliance by the parties thereto with the other requirements of
Section 10.11.1, and thereupon, if requested by the assignee, one or more new
Notes shall be issued to the designated assignee and the old Note shall be
returned by the Administrative Agent to the Borrower marked "exchanged". No
assignment of a Note and the obligation evidenced thereby shall be effective
unless it shall have been recorded in the Register by the Administrative Agent
as provided in this Section.
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SECTION 2.8. Equalization Transfers. Until such time as U.S. Bancorp is no
longer the Administrative Agent and Swing Line Lender hereunder, the following
provisions shall apply notwithstanding any other provisions herein to the
contrary:
(a) It is anticipated that the Borrower may wish to borrow and repay
Loans on each Business Day, and that repayments will be received
automatically from the accounts referred to in Section 5.1.11. Except to
the extent otherwise required by this Agreement, the daily Borrowings by
the Borrower will be accommodated by the Swing Line Lender by the making of
Swing Line Loans. To minimize the number of transfers of funds to and from
the Lenders resulting from such Borrowings and repayments, the Swing Line
Lender may fund daily Loans for the accounts of the Lenders and apply daily
repayments of Loans to the accounts of the Lenders other than according to
each Lenders' Percentage (i.e., without receiving each such other Lender's
Percentage of a Loan on the date of disbursement thereof or without paying
each such other Lender's Percentage of a repayment of a Loan on the date of
payment thereof); provided, however, that no such Loan shall be made and no
repayment of a Loan shall be applied other than according to the Lenders'
Percentages if (i) at the time of the making or repayment of any Loan, the
Administrative Agent has actual knowledge of a Default, (ii) after giving
effect to the requested Loan, the Swing Line Lender would hold, at the end
of any Business Day, Loans exceeding its Percentage of the then existing
Revolving Loan Commitment Amount plus the Swing Line Loan Commitment
Amount, or (iii) after applying any repayment, the Swing Line Lender would
hold, at the end of any Business Day, Loans of less than zero Dollars ($0).
(b) At any time at the Administrative Agent's discretion, and, in any
event, as of the end of the last Business Day of each week if the
outstanding Loans are not held according to the Lenders' Percentages, the
Administrative Agent shall give notice to the Lenders of the amount of
funds to be transferred from the Swing Line Lender to the Administrative
Agent for the account of each Lender, or from the Lenders to the
Administrative Agent for the account of the Swing Line Lender, as the case
may be (each such transfer, an "Equalization Transfer"), required to cause
the Loans to be held by the Lenders (including the Swing Line Lender)
according to their respective Percentage. On the Business Day following
such notice, the necessary Equalization Transfers shall be made in
immediately available funds on or before 11:00 a.m., Denver, Colorado time;
provided, however, that Equalization Transfers necessary to avoid any event
described in clause (a)(ii) or (a)(iii) of Section 2.8 shall be made prior
to close of business on the same Business Day such notice is received by
each such Lender.
(c) Except as set forth in clause (d) below, any Equalization Transfer
(i) by any Lender to the Administrative Agent for the account of the Swing
Line Lender shall be deemed to constitute a Loan by such Lender to the
Borrower and a repayment by the Borrower of Loans held by the Swing Line
Lender, and (ii) by the Swing Line Lender to the Administrative Agent for
the account of each Lender shall be deemed to constitute a Loan by the
Swing Line Lender to the Borrower and a repayment of Loans held by such
Lender.
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(d) To the extent a Default of the nature set forth in Section 8.1.9
shall have occurred and be continuing on the date on which any Equalization
Transfer is required to be made pursuant to clause (b) above, any such
Equalization Transfer (i) by any Lender to the Administrative Agent for the
account of the Swing Line Lender, and (ii) by the Swing Line Lender to the
Administrative Agent for the account of any Lender shall, in each case, be
deemed to constitute a purchase by each such Lender or the Swing Line
Lender, as the case may be, of a direct interest, in the amount of such
Equalization Transfer, in outstanding Loans, such that each of the Lenders
shall have an interest in such Loans equal to their respective Percentage
as of the date of occurrence of such Default.
(e) At any time after any Lender (a "Selling Lender") shall have
received any Equalization Transfer that constitutes a purchase by any other
Lender (a "Purchasing Lender") of a direct interest in such Selling
Lender's Loans pursuant to clause (d) above, if such Selling Lender
receives any payment on account of its Loans, such Selling Lender will
distribute to such Purchasing Lender its proportionate share of such
payment (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Purchasing Lender's direct
interest was outstanding and funded); provided, however, that in the event
that such payment received by such Selling Lender is required to be
returned, such Purchasing Lender will return to such Selling Lender any
portion thereof previously distributed to it by such Selling Lender.
(f) Each Lender's obligation to make Equalization Transfers pursuant
to clause (b) above shall be absolute and unconditional and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender or any other Person
may have against the Administrative Agent, the Swing Line Lender or any
other Person for any reason whatsoever, (ii) the occurrence or continuance
of a Default, an Event of Default or a Commitment Termination Event, (iii)
any materially adverse change in the condition (financial or otherwise) of
the Borrower or any other Obligor, (iv) any breach of this Agreement by any
Obligor or any Lender (including any Lender's failure to make any
Equalization Transfer) or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.
ARTICLE III
REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
SECTION 3.1. Repayments and Prepayments; Application.
SECTION 3.1.1. Repayments and Prepayments. The Borrower shall repay in full
the unpaid principal amount of each Loan upon the Stated Maturity Date therefor.
Prior thereto, the Borrower
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(a) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any
Revolving Loan; provided, however, that
(i) any such prepayment of Revolving Loans shall be made pro rata
among the Revolving Loans of the same type and, if applicable, having
the same Interest Period of all Lenders that have made such Revolving
Loans;
(ii) the Borrower shall comply with Section 4.4 in the event that
any LIBO Rate Loan is prepaid on any day other than the last day of
the Interest Period for such LIBO Rate Loan;
(iii) all such voluntary prepayments shall require at least one
Business Day's notice in the case of Base Rate Loans, three Business
Days' notice in the case of LIBO Rate Loans, but no more than five
Business Days' notice in the case of any Loans, in each case in
writing to the Administrative Agent; and
(iv) all such voluntary partial prepayments shall be in a minimum
aggregate amount of $5,000,000 and an integral multiple of $1,000,000,
or in the aggregate principal amount of all Loans of the type then
outstanding;
(b) may, from time to time on any Business Day, make a voluntary
prepayment, in whole or in part, of the outstanding principal amount of any
Swing Line Loans;
(c) shall, on each date when the sum of (i) the aggregate outstanding
principal amount of all Loans plus (ii) the aggregate amount of all Letter
of Credit Outstandings less all cash proceeds in the accounts referred to
in Section 7.1.9 at the time of determination of any of the foregoing
exceeds the lesser of (A) the Revolving Loan Commitment Amount (as it may
be reduced from time to time, pursuant to Section 2.2), and (B) the then
applicable Borrowing Base Amount, make a mandatory prepayment of all Loans
and, if necessary, Cash Collateralize Letter of Credit Outstandings, in an
aggregate amount equal to such excess;
(d) shall, not later than one Business Day following the receipt of
any Net Disposition Proceeds (in respect of any assets other than Fixed
Assets) by the Borrower or any of its Restricted Subsidiaries, deliver to
the Administrative Agent a calculation of the amount of such Net
Disposition Proceeds and make a mandatory prepayment of the Loans in an
amount equal to 100% of such Net Disposition Proceeds, to be applied as set
forth in Section 3.1.2; provided, however, that no such mandatory
prepayment of the Loans shall be required under this clause (d) to the
extent (i) such Net Disposition Proceeds are received in connection with
clause (c) of Section 7.2.9 or (ii) the Borrower notifies the Agents no
later than 15 days following the receipt of such Net Disposition Proceeds
(provided, that no notice shall be required with respect to amounts not in
excess of $1,000,000) that it is the Borrower's or its Restricted
53
Subsidiary's good faith intention to apply such Net Disposition Proceeds
toward the acquisition of other assets or property used in the business of
such Person (and, in any event, in compliance with Section 7.2.1) and such
Person in fact so uses such Net Disposition Proceeds within 365 days
following the receipt by such Person of Net Disposition Proceeds, with the
amount of Net Disposition Proceeds unused after such 365-day period being
applied to prepay the Loans pursuant to this clause (d);
(e) shall, not later than one Business Day following the receipt of
any Net Debt Proceeds by the Borrower or any of its Restricted
Subsidiaries, deliver to the Administrative Agent a calculation of the
amount of such Net Debt Proceeds, and make a mandatory prepayment of the
Loans in an amount equal to 100% of such Net Debt Proceeds, to be applied
as set forth in Section 3.1.2;
(f) shall, concurrently with the receipt of any Net Equity Proceeds by
the Borrower or any of its Restricted Subsidiaries, deliver to the
Administrative Agent a calculation of the amount of such Net Equity
Proceeds, and no later than five Business Days following the delivery of
such calculation, make a mandatory prepayment of the Loans in an amount
equal to 50% of such Net Equity Proceeds, to be applied as set forth in
Section 3.1.2;
(g) shall, not later than one Business Day following the receipt of
any Net Casualty Proceeds (in respect of any assets other than Fixed
Assets) by the Borrower or any of its Restricted Subsidiaries, deliver to
the Administrative Agent a calculation of the amount of such Net Casualty
Proceeds and make a mandatory prepayment of the Loans in an amount equal to
100% of such Proceeds, to be applied as set forth in Section 3.1.2;
provided, that no such mandatory prepayment of Net Casualty Proceeds shall
be required under this clause (g) (i) if the Borrower notifies the Agents
no later than 60 days following the receipt of such Net Casualty Proceeds
of the Borrower's or its Restricted Subsidiary's good faith intention to
apply such Net Casualty Proceeds to the rebuilding or replacement of such
damaged, destroyed or condemned assets or property and (ii) to the extent
such Person in fact uses such Net Casualty Proceeds to begin rebuilding or
replacing the damaged, destroyed or condemned assets or property within 180
days following the receipt of such Net Casualty Proceeds and continues
diligently to complete such rebuilding or replacement of such damaged,
destroyed or condemned assets or property within the time reasonably
required therefore (the "Rebuilding and Replacement Work"), with the amount
of Net Casualty Proceeds unused after the completion of such Rebuilding and
Replacement Work being applied to the Loans pursuant to Section 3.1.2;
(h) shall, on each date when any reduction in the Revolving Loan
Commitment Amount shall become effective, make a mandatory prepayment of
the Loans and (if necessary) Cash Collateralize Letter of Credit
Outstandings in an aggregate amount equal to the excess, if any, of the sum
of (i) the aggregate outstanding principal amount of all Revolving Loans
and Swing Line Loans and (ii) the aggregate amount of all Letter of Credit
Outstandings over the Revolving Loan Commitment Amount as so reduced; and
54
(i) shall, immediately upon the occurrence of the Stated Maturity Date
of any Loans or Obligations, whether by way of acceleration pursuant to
Section 8.2 or Section 8.3 or otherwise, repay all outstanding Loans and
other Obligations, unless, pursuant to Section 8.3, only a portion of all
Loans and other Obligations are so accelerated (in which case the portion
so accelerated shall be so prepaid).
Each prepayment of any Loans made pursuant to this Section shall be without
premium or penalty, except as may be required by Section 4.4. No prepayment of
principal of any Revolving Loans pursuant to clause (a), (b) (c), (d), (e), (f)
or (g) of Section 3.1.1 shall cause a reduction in the Revolving Loan Commitment
Amount, the Swing Line Loan Commitment Amount or the Letter of Credit Commitment
Amount, as the case may be.
SECTION 3.1.2. Application. Each prepayment or repayment of principal of
the Loans shall be applied, to the extent of such prepayment or repayment,
first, to the principal amount thereof being maintained as Base Rate Loans, and
second, to the principal amount thereof being maintained as LIBO Rate Loans;
provided that prepayments or repayments of LIBO Rate Loans not made on the last
day of the Interest Period with respect thereto, shall be prepaid or repaid
subject to the provisions of Section 4.4 (together with a payment of all accrued
interest).
SECTION 3.2. Interest Provisions. Interest on the outstanding principal
amount of the Loans shall accrue and be payable in accordance with this Section
3.2.
SECTION 3.2.1. Rates. (a) Each Base Rate Loan shall accrue interest on the
unpaid principal amount thereof for each day from and including the day upon
which such Loan was made or converted to a Base Rate Loan to but excluding the
date such Loan is repaid or converted to a LIBO Rate Loan at a rate per annum
equal to the sum of the Alternate Base Rate for such day plus the Applicable
Margin for such Loan on such day.
(b) Each LIBO Rate Loan shall accrue interest on the unpaid principal
amount thereof for each day during each Interest Period applicable thereto at a
rate per annum equal to the sum of the LIBO Rate (Reserve Adjusted) for such
Interest Period plus the Applicable Margin for such Loan on such day.
SECTION 3.2.2. Post-Maturity Rates. After the date any principal amount of
any Loan is due and payable (whether on the applicable Stated Maturity Date,
upon acceleration or otherwise), or any other monetary Obligation (other than
overdue Reimbursement Obligations which shall bear interest as provided in
Section 2.6.2) of the Borrower is due and payable, the Borrower shall pay, but
only to the extent permitted by law, interest (after as well as before judgment)
on such amounts at a rate per annum equal to the rate that would otherwise be
applicable to Base Rate Loans pursuant to Section 3.2.1 plus 2%.
SECTION 3.2.3. Payment Dates. Interest accrued on each Loan shall be
payable, without duplication:
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(a) on the Stated Maturity Date therefor;
(b) in the case of a LIBO Rate Loan, on the date of any payment or
prepayment, in whole or in part, of principal outstanding on such Loan, to
the extent of the unpaid interest accrued through such date on the
principal so paid or prepaid;
(c) with respect to Base Rate Loans, on each Monthly Payment Date
occurring after the Closing Date hereunder;
(d) with respect to LIBO Rate Loans, on the last day of each
applicable Interest Period (and, if such Interest Period shall exceed three
months, at intervals of three months after the first day of such Interest
Period);
(e) with respect to the principal amount of any Base Rate Loans
converted into LIBO Rate Loans on a day when interest would not otherwise
have been payable pursuant to clause (c), above, on the date of such
conversion; and
(f) on that portion of any Loans the Stated Maturity Date of which is
accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such
acceleration.
Interest accrued on Loans, Reimbursement Obligations or other monetary
Obligations arising under this Agreement or any other Loan Document after the
date such amount is due and payable (whether on the Stated Maturity Date, upon
acceleration or otherwise) shall be payable upon demand; provided, that so long
as the Borrower shall be in compliance with Section 5.2, any such amounts which
are due and payable shall be funded with the proceeds of a Swing Line Loan.
SECTION 3.3. Fees. The Borrower agrees to pay the fees set forth in this
Section 3.3. All such fees shall be non-refundable.
SECTION 3.3.1. Commitment Fee. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender, for each day during the
period (including any portion thereof when any of the Lenders' Revolving Loan
Commitments are suspended by reason of the Borrower's inability to satisfy any
condition of Article V) commencing on the Closing Date and continuing through
the Revolving Loan Commitment Termination Date, a commitment fee on such
Lender's Percentage of the daily average unused portion of the Revolving Loan
Commitment Amount, whether or not then available, for such day at a rate per
annum equal to the Applicable Commitment Fee for such day. Such commitment fees
shall be payable by the Borrower in arrears on each Quarterly Payment Date,
commencing with the first such day following the Closing Date, and ending on the
Revolving Loan Commitment Termination Date. The making of Swing Line Loans by
the Swing Line Lender shall not constitute usage under the Revolving Loan
Commitment for the purpose of calculating the commitment fees to be paid by the
Borrower to the Lenders (other than the Swing Line Lender) pursuant to this
Section 3.3.1.
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SECTION 3.3.2. The Agents' and the Co-Lead Arrangers' Fees. The Borrower
agrees to pay to each of the Syndication Agent, the Administrative Agent, the
Documentation Agent and the Co-Lead Arrangers for each such Person's own
account, the fees set forth in the Fee Letter and the Administrative Agent's Fee
Letter, in each case in accordance with their respective terms.
SECTION 3.3.3. Letter of Credit Fee. The Borrower agrees to pay to
(a) the Administrative Agent, for the pro rata account of the Issuer
and each other Lender, a Letter of Credit fee for each day on which there
shall be any Letter of Credit Outstandings in an amount equal to the
product of (i) a rate per annum equal to the then Applicable Margin for
Loans maintained as LIBO Rate Loans multiplied by (ii) the Stated Amount of
each such Letter of Credit; and
(b) the Issuer (i) a Letter of Credit fronting fee for each day on
which there shall be any Letter of Credit Outstandings in an amount equal
to .125% per annum on the Stated Amount of each such Letter of Credit, and
(ii) from time to time promptly after demand, the normal issuance,
presentation, amendment and other processing fees, and other standard
administrative costs and charges of the Issuer relating to Letters of
Credit as from time to time in effect.
Fees payable pursuant to this Section shall be payable quarterly in arrears on
each Quarterly Payment Date and on the Revolving Loan Commitment Termination
Date.
ARTICLE IV
CERTAIN LIBO RATE AND OTHER PROVISIONS
SECTION 4.1. LIBO Rate Lending Unlawful. If any Lender shall determine
(which determination shall, upon notice thereof to the Borrower and the
Administrative Agent, be conclusive and binding on the Borrower) that the
introduction of or any change in or in the interpretation of any law, in each
case after the date upon which such Lender shall have become a Lender hereunder,
makes it unlawful, or any central bank or other Governmental Authority asserts,
after such date, that it is unlawful, for such Lender to make, continue or
maintain any Loan as, or to convert any Loan into, a LIBO Rate Loan, the
obligations of such Lender to make, continue, maintain or convert any such LIBO
Rate Loan shall, upon such determination, forthwith be suspended until such
Lender shall notify the Administrative Agent that the circumstances causing such
suspension no longer exist (with the date of such notice being the
"Reinstatement Date"), and (a) all LIBO Rate Loans previously made by such
Lender shall automatically convert into Base Rate Loans at the end of the then
current Interest Periods with respect thereto or sooner, if required by such law
or assertion and (b) all Loans thereafter made by such Lender and outstanding
prior to the Reinstatement Date shall be made as Base Rate Loans, with interest
thereon being payable on the same date that interest is payable with respect to
the corresponding Borrowing of LIBO Rate Loans made by Lenders not so affected.
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SECTION 4.2. Deposits Unavailable. If the Administrative Agent shall have
determined that
(a) Dollar deposits in the relevant amount and for the relevant
Interest Period are not available to the Administrative Agent in its
relevant market; or
(b) by reason of circumstances affecting the Administrative Agent's
relevant market, adequate means do not exist for ascertaining the interest
rate applicable hereunder to LIBO Rate Loans,
then, upon notice from the Administrative Agent to the Borrower and the Lenders,
the obligations of all Lenders under Section 2.3 and Section 2.4 to make or
continue any Loans as, or to convert any Loans into, LIBO Rate Loans shall
forthwith be suspended until the Administrative Agent shall notify the Borrower
and the Lenders that the circumstances causing such suspension no longer exist.
SECTION 4.3. Increased LIBO Rate Loan Costs, etc. The Borrower agrees to
reimburse each Lender and the Issuer for any increase in the cost to such Lender
or the Issuer of, or any reduction in the amount of any sum receivable by such
Person in respect of, making, continuing or maintaining (or of its obligation to
make, continue or maintain) any Loans as, or of converting (or of its obligation
to convert) any Loans into, LIBO Rate Loans that arise in connection with any
change in, or the introduction, adoption, effectiveness, interpretation,
reinterpretation or phase-in after the date hereof of, any law or regulation,
directive, guideline, decision or request (whether or not having the force of
law) of any Governmental Authority, except for such changes with respect to
increased capital costs and Taxes which are governed by Sections 4.5 and 4.6,
respectively. Such Lender or the Issuer shall promptly notify the Administrative
Agent and the Borrower in writing of the occurrence of any such event, such
notice to state, in reasonable detail, the reasons therefor and the additional
amount required fully to compensate such Lender for such increased cost or
reduced amount. Such additional amounts shall be payable by the Borrower
directly to such Lender or the Issuer within five days of its receipt of such
notice, and such notice shall, in the absence of manifest error, be conclusive
and binding on the Borrower; provided, that each Lender and the Issuer agrees to
treat the Borrower in a similar manner as similarly situated borrowers in
connection with any such amounts.
SECTION 4.4. Funding Losses. In the event any Lender shall incur any loss
or expense (including any loss or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such Lender to make,
continue or maintain any portion of the principal amount of any Loan as, or to
convert any portion of the principal amount of any Loan into, a LIBO Rate Loan)
as a result of
(a) any conversion or repayment or prepayment of the principal amount
of any LIBO Rate Loans on a date other than the scheduled last day of the
Interest Period applicable thereto, whether pursuant to Article III or
otherwise;
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(b) any Loans not being made as LIBO Rate Loans in accordance with the
Borrowing Request therefor; or
(c) any Loans not being continued as, or converted into, LIBO Rate
Loans in accordance with the Continuation/Conversion Notice therefor,
then, upon the written notice of such Lender to the Administrative Agent (with a
copy to the Borrower) within thirty days of the date such Lender would
reasonably be expected to become aware of such loss or expense, the
Administrative Agent shall, within five days of its receipt thereof, cause
payment to be made (from the account of the Borrower) directly to such Lender
such amount as will (in the reasonable determination of such Lender) reimburse
such Lender for such loss or expense. Such written notice shall, in the absence
of manifest error, be conclusive and binding on the Borrower.
SECTION 4.5. Increased Capital Costs. If any change in, or the
introduction, adoption, effectiveness, interpretation, reinterpretation or
phase-in of, any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any Governmental Authority, in each
case occurring after the applicable Lender becomes a Lender hereunder, affects
or would affect the amount of capital required or expected to be maintained by
any Lender or any Person controlling such Lender, and such Lender determines (in
its sole and absolute discretion) that the rate of return on its or such
controlling Person's capital as a consequence of its Commitments, participation
in Letters of Credit or the Loans made by such Lender is reduced to a level
below that which such Lender or such controlling Person could have achieved but
for the occurrence of any such circumstance, then, in any such case upon notice
from time to time by such Lender to the Borrower (which notice shall contain a
calculation of such amount in reasonable detail), the Borrower shall immediately
pay directly to such Lender additional amounts sufficient to compensate such
Lender or such controlling Person for such reduction in rate of return. A
statement of such Lender as to any such additional amount or amounts shall, in
the absence of manifest error, be conclusive and binding on the Borrower. In
determining such amount, such Lender may use any method of averaging and
attribution that it (in its sole and absolute discretion) shall deem applicable.
SECTION 4.6. Taxes. The Borrower covenants and agrees as follows with
respect to Taxes:
(a) Any and all payments by the Borrower and each other Obligor under
this Agreement and each other Loan Document shall be made without setoff,
counterclaim or other defense, and free and clear of, and without deduction
or withholding for or on account of, any Taxes. In the event that any Taxes
are required by law to be deducted or withheld from any payment required to
be made by the Borrower or any other Obligor to or on behalf of any Lender
under any Loan Document, then:
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(i) subject to clause (f), below, if such Taxes are Non-Excluded
Taxes, the amount of such payment shall be increased as may be
necessary such that such payment is made, after withholding or
deduction for or on account of such Taxes, in an amount that is not
less than the amount provided for herein or in such other Loan
Document; and
(ii) the Borrower shall withhold the full amount of such Taxes
from such payment (as increased pursuant to clause (a) (i)) and shall
pay such amount to the Governmental Authority imposing such Taxes in
accordance with applicable law.
(b) In addition, the Borrower and each other Obligor shall pay any and
all Other Taxes imposed to the relevant Governmental Authority imposing
such Other Taxes in accordance with applicable law.
(c) As promptly as practicable after the payment of any Taxes or Other
Taxes, and in any event within 45 days of any such payment being due, the
Borrower shall furnish to the Administrative Agent a copy of an official
receipt (or a certified copy thereof) evidencing the payment of such Taxes
or Other Taxes.
(d) Subject to clause (f), below, the Borrower shall indemnify any
Lender for any Non-Excluded Taxes and Other Taxes levied, imposed or
assessed on (and whether or not paid directly by) such Lender (whether or
not such Non-Excluded Taxes or Other Taxes are correctly or legally
asserted by the relevant Governmental Authority). Promptly upon having
knowledge that any such Non-Excluded Taxes or Other Taxes have been levied,
imposed or assessed, and promptly upon notice thereof by such Lender, the
Borrower shall pay such Non-Excluded Taxes or Other Taxes directly to the
relevant Governmental Authority (provided, however, that such Lender shall
not be under any obligation to provide any such notice to the Borrower). In
addition, the Borrower shall indemnify any Lender for any incremental Taxes
that may become payable by such Lender as a result of any failure of the
Borrower to pay any Taxes when due to the appropriate Governmental
Authority or to deliver to the Administrative Agent, pursuant to clause
(c), above, documentation evidencing the payment of Taxes or Other Taxes.
With respect to indemnification for Non-Excluded Taxes and Other Taxes
actually paid by any Lender or the indemnification provided in the
immediately preceding sentence, such indemnification shall be made within
30 days after the date such Lender makes written demand therefor. The
Borrower acknowledges that any payment made to the Administrative Agent,
for the account of each Lender or to any Governmental Authority in respect
of the indemnification obligations of the Borrower provided in this clause
shall constitute a payment in respect of which the provisions of clause
(a), above, and this clause shall apply.
(e) Each Non-U.S. Lender, shall (i) on or before the date (x) it
becomes a Lender and (y) that any predecessor form expired or became
obsolete or (ii) after the occurrence of any event requiring a change in
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the most recent forms or documentation previously delivered by such Lender
pursuant hereto, deliver to the Borrower
(i) (x) two duly completed copies of either (A) Internal Revenue
Service Form 1001 or (B) Internal Revenue Service Form 4224, or in
either case an applicable successor form, and (y) a duly completed
copy of Internal Revenue Service Form W-8 or W-9 or applicable
successor form; or
(ii) if such Non-U.S. Lender is not legally entitled to deliver
either form listed in clause (e)(i)(x), above, (x) a certificate of a
duly authorized officer of such Non-U.S. Lender to the effect that
such Non-U.S. Lender is not (A) a "bank" within the meaning of Section
881(c)(3)(A) of the Code, (B) a "10 percent shareholder" of the
Borrower within the meaning of Section 881(c)(3)(B) of the Code, or
(C) a controlled foreign corporation receiving interest from a related
person within the meaning of Section 881 (c)(3)(C) of the Code (such
certificate, an "Exemption Certificate") and (y) two duly completed
copies of Internal Revenue Service Form W-8 or applicable successor
form.
(f) The Borrower shall not be obligated to gross up any payments to
any Lender pursuant to clause (a)(i), above, or to indemnify such Lender
pursuant to clause (d), above, in respect of United States federal
withholding taxes to the extent imposed as a result of (i) the failure of
such Lender to deliver to the Borrower the form or forms and/or an
Exemption Certificate, as applicable to such Lender, pursuant to clause
(e), above, (ii) such form or forms and/or Exemption Certificate not
establishing a complete exemption from U.S. federal withholding tax or the
information or certifications made therein by such Lender being untrue or
inaccurate on the date delivered in any material respect, (iii) such Lender
designating a successor lending office at which it maintains its Loans
which has the effect of causing such Lender to become obligated for tax
payments in excess of those in effect immediately prior to such designation
or (iv) such Lender or the Administrative Agent being treated as a "conduit
entity" within the meaning of U.S. Treasury regulations Section 1.881-3 or
any successor provision; provided, however, that the Borrower shall be
obligated to gross up any payments to such Lender pursuant to clause
(a)(i), above, and to indemnify such Lender pursuant to clause (d), above,
in respect of United States federal withholding taxes if (i) any such
failure to deliver a form or forms or an Exemption Certificate or the
failure of such form or forms or Exemption Certificate to establish a
complete exemption from U.S. federal withholding tax or inaccuracy or
untruth contained therein resulted from a change in any applicable statute,
treaty, regulation or other applicable law or any interpretation of any of
the foregoing occurring after the date hereof, which change rendered such
Lender no longer legally entitled to deliver such form or forms or
Exemption Certificate or otherwise ineligible for a complete exemption from
U.S. federal withholding tax, or rendered the information or certifications
made in such form or forms or Exemption Certificate untrue or inaccurate in
a material respect, (ii) the redesignation of such Lender's lending office
was made at the request of the Borrower or (iii) the obligation to gross up
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payments to any Lender pursuant to clause (a)(i) above, or to indemnify
such Lender pursuant to clause (d) above, is with respect to an Assignee
Lender that becomes an Assignee Lender as a result of an assignment made at
the request of the Borrower.
(g) If the Borrower pays any additional amount under this Section to a
Lender and such Lender determines in its sole discretion that it has
actually received or realized in connection therewith any refund or any
reduction of, or credit against, its Tax liabilities in or with respect to
the taxable year in which the additional amount is paid (a "Tax Benefit"),
such Lender shall pay to the Borrower an amount that the Lender shall, in
its sole discretion, determine is equal to the net benefit after tax, which
was obtained by the Lender in such year as a consequence of such Tax
Benefit; provided, however, that (i) any Lender may determine, in its sole
discretion consistent with the policies of such Lender, whether to seek a
Tax Benefit; (ii) any Taxes that are imposed on a Lender as a result of a
disallowance or reduction (including through the expiration of any tax
credit or carryover or carryback of such Lender that otherwise would not
have expired) of any Tax Benefit with respect to which such Lender had made
a payment to the Borrower pursuant to this clause shall be treated as a
Non-Excluded Tax for which the Borrower is obligated to indemnify such
Lender pursuant to this Section without any exclusions or defenses; and
(iii) nothing in this clause shall require the Lender to disclose any
confidential information to the Borrower (including its tax returns).
SECTION 4.7. Payments, Computations, etc. Unless otherwise expressly
provided in any Loan Document, all payments by or on behalf of the Borrower
pursuant to this Agreement or any other Loan Document shall be made by the
Borrower to the Administrative Agent for the pro rata account of the Lenders,
Issuer, Agents or Co-Lead Arrangers, as applicable, entitled to receive such
payment. All such payments required to be made to the Administrative Agent shall
be made, without setoff, deduction or counterclaim, not later than 2:00 p.m.,
Denver, Colorado time, on the date due, in same day or immediately available
funds, to such account as the Administrative Agent shall specify from time to
time by notice to the Borrower. Funds received after that time shall be deemed
to have been received by the Administrative Agent on the next succeeding
Business Day. The Administrative Agent shall promptly remit in same day funds to
each Lender, Issuer, Agent or Co-Lead Arrangers, as the case may be, its share,
if any, of such payments received by the Administrative Agent for the account of
such Lender, Issuer, Agent or Co-Lead Arrangers, as the case may be. All
interest and fees shall be computed on the basis of the actual number of days
(including the first day but excluding the last day) occurring during the period
for which such interest or fee is payable over a year comprised of 360 days (or,
in the case of interest on a Base Rate Loan, 365 days or, if appropriate, 366
days). Whenever any payment to be made shall otherwise be due on a day which is
not a Business Day, such payment shall (except as otherwise required by clause
(a) of the definition of the term "Interest Period") be made on the next
succeeding Business Day and such extension of time shall be included in
computing interest and fees, if any, in connection with such payment.
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SECTION 4.8. Sharing of Payments. If any Lender shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Loan or Reimbursement Obligations (other than
pursuant to the terms of Sections 4.3, 4.4 and 4.5) in excess of its pro rata
share of payments then or therewith obtained by all Lenders entitled thereto,
such Lender shall purchase from the other Lenders such participation in the
Credit Extensions made by 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, that if all or any portion of the excess payment or other
recovery is thereafter recovered from such purchasing Lender, the purchase shall
be rescinded and each Lender which has sold a participation to the purchasing
Lender shall repay to the purchasing Lender the purchase price to the ratable
extent of such recovery together with an amount equal to such selling Lender's
ratable share (according to the proportion of (a) the amount of such selling
Lender's required repayment to the purchasing Lender in respect of such recovery
to (b) the total amount so recovered from the purchasing Lender) of any interest
or other amount paid or payable by the purchasing Lender in respect of the total
amount so recovered. The Borrower agrees that any Lender so purchasing a
participation from another Lender pursuant to this Section may, to the fullest
extent permitted by law, exercise all its rights of payment (including pursuant
to Section 4.9) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrower in the amount of such participation. If
under any applicable bankruptcy, insolvency or other similar law, any Lender
receives a secured claim in lieu of a setoff to which this Section applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders entitled
under this Section to share in the benefits of any recovery on such secured
claim.
SECTION 4.9. Setoff. Each Secured Party shall, upon the occurrence of any
Event of Default described in clauses (a) through (d) of Section 8.1.9 with
respect to any Obligor or, with the consent of the Required Lenders, upon the
occurrence of any other Event of Default, to the fullest extent permitted by
law, have the right to appropriate and apply to the payment of the Obligations
then due to it, and (as security for such Obligations) the Borrower hereby
grants to each Secured Party a continuing security interest in, any and all
balances, credits, deposits, accounts or moneys of the Borrower then or
thereafter maintained with or otherwise held by such Secured Party; provided,
however, that any such appropriation and application shall be subject to the
provisions of Section 4.8. Each Secured Party agrees promptly to notify the
Borrower and the Administrative Agent after any such setoff and application made
by such Secured Party; provided, however, that the failure to give such notice
shall not affect the validity of such setoff and application. The rights of each
Secured Party under this Section are in addition to other rights and remedies
(including other rights of setoff under applicable law or otherwise) which such
Secured Party may have.
SECTION 4.10. Change of Lending Office. Each Lender agrees that if it makes
any demand for payment under Section 4.3, 4.4, 4.5, or 4.6, or if any adoption
or change of the type described in Section 4.1 shall occur with respect to it,
it will, if requested by the Borrower, use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions and so long as such
efforts would not be disadvantageous to it, as determined in its sole
discretion) to designate a different lending office if the making of such a
designation would reduce or obviate the need for the Borrower to make payments
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under Section 4.3, 4.4, 4.5, or 4.6, or would eliminate or reduce the effect of
any adoption or change described in Section 4.1.
SECTION 4.11. Replacement of Lenders. If any Lender (a "Subject Lender")
makes a demand upon the Borrower for (or if the Borrower is otherwise required
to pay) amounts pursuant to Section 4.3, 4.5 or 4.6, or gives notice pursuant to
Section 4.1 requiring a conversion of such Subject Lender's LIBO Rate Loans to
Base Rate Loans or suspending such Lender's obligation to make Loans as, or to
convert Loans into, LIBO Rate Loans, the Borrower may, within 90 days of receipt
by the Borrower of such demand or notice (or the occurrence of such other event
causing the Borrower to be required to pay such compensation), as the case may
be, give notice (a "Replacement Notice") in writing to the Agents and such
Subject Lender of its intention to replace such Subject Lender with a financial
institution (a "Replacement Lender") designated in such Replacement Notice. If
the Agents shall, in the exercise of their reasonable discretion and within 30
days of their receipt of such Replacement Notice, notify the Borrower and such
Subject Lender in writing that the designated financial institution is
satisfactory to the Agents (such consent not being required where the
Replacement Lender is already a Lender), then such Subject Lender shall, so long
as no Default or Event of Default shall have occurred and be continuing (and
subject to the payment of any amounts due pursuant to Section 4.4), assign, in
accordance with Section 10.11.1, all of its Commitments, Loans, Notes (if any)
and other rights and obligations under this Agreement and all other Loan
Documents (including, Reimbursement Obligations) to such designated financial
institution; provided, however, that (i) such assignment shall be without
recourse, representation or warranty and shall be on terms and conditions
reasonably satisfactory to such Subject Lender and such designated financial
institution and (ii) the purchase price paid by such designated financial
institution shall be in the amount of such Subject Lender's Loans and its
applicable Percentage of outstanding Reimbursement Obligations, together with
all accrued and unpaid interest and fees in respect thereof, plus all other
amounts (including the amounts demanded and unreimbursed under Sections 4.2,
4.3, 4.5 and 4.6), owing to such Subject Lender hereunder. Upon the effective
date of an assignment described above, the Borrower shall issue a replacement
Note (to the extent such Replacement Lender shall have requested a replacement
Note pursuant to Sections 2.7 and 10.11.1) to such Replacement Lender and such
institution shall become a "Lender" for all purposes under this Agreement and
the other Loan Documents.
ARTICLE V
CONDITIONS TO CREDIT EXTENSIONS
SECTION 5.1. Initial Credit Extension. The obligations of the Lenders and,
if applicable, the Issuer to fund the initial Credit Extension shall be subject
to the prior or concurrent satisfaction of each of the conditions precedent set
forth in this Section 5.1.
SECTION 5.1.1. Resolutions, etc. The Agents shall have received from each
Obligor (a) a copy of a current good standing certificate, dated a date
reasonably close to the Closing Date, for each such Person and (b) a
certificate, dated the Closing Date, duly executed and delivered by such
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Person's Secretary or Assistant Secretary as to (i) resolutions of such Person's
Board of Directors then in full force and effect authorizing the execution,
delivery and performance of this Agreement and each other Loan Document to be
executed by such Person and the transactions contemplated hereby and thereby,
(ii) the incumbency and signatures of those of such Person's officers and
employees authorized to act with respect to this Agreement and each other Loan
Document to be executed by such Person, and (iii) the full force and validity of
each Organic Document of such Person and copies thereof, upon which certificates
each Agent and each Lender may conclusively rely until it shall have received a
further certificate of the Secretary or Assistant Secretary of such Obligor
canceling or amending such prior certificate.
SECTION 5.1.2. Delivery of Notes. The Agents shall have received, for the
account of each Lender requesting a Note, such Lender's Note duly executed and
delivered by an Authorized Officer of the Borrower.
SECTION 5.1.3. Transaction Documents. The Agents shall have received (with
copies for each Lender that shall have expressly requested copies thereof) fully
executed copies of the Transaction Documents and all certificates, opinions and
other documents delivered thereunder, certified to be true and complete copies
thereof by an Authorized Officer of the Borrower.
SECTION 5.1.4. Consummation of Transaction, etc. (a) The Agents shall have
received evidence satisfactory to each of them that all actions necessary to
consummate the Transaction shall have been taken in accordance with all
applicable law and in accordance with the terms of each applicable Transaction
Document, without amendment or waiver of any material provision thereof by
Parent, the Borrower or any of their Affiliates. There shall exist at and as of
the Closing Date (after giving effect to the Transaction and the initial Credit
Extensions hereunder) no conditions that would constitute a default or an event
of default under any of the Transaction Documents;
(b) Prior to or concurrently with the making of the initial Credit
Extension, (i) the Acquisition Transactions shall have been consummated, on
terms and conditions and pursuant to documentation reasonably satisfactory to
the Agents; (ii) the Capital Transactions shall have been consummated, on terms
and conditions and pursuant to documentation reasonably satisfactory to the
Agents; (iii) the Borrower shall have completed the Refinancing, on terms and
conditions and pursuant to documentation reasonably satisfactory to the Agents;
and (iv) the Borrower shall have paid all fees and expenses (or shall have
sufficient Excess Availability to pay any unpaid fees and expenses) relating to
the Transaction, which fees and expenses shall be satisfactory to the Agents;
and
(c) The Agents shall be reasonably satisfied with all aspects of the
Transaction, including, (i) the capital and corporate structure of Parent, the
Borrower and each of their respective Subsidiaries; (ii) the sources and uses of
the proceeds utilized to consummate the Transaction; (iii) the terms and
provisions of each of the Transaction Documents (including the Product Supply
Agreement); and (iv) the tax, legal and environmental due diligence
investigations of the Borrower and its Subsidiaries.
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SECTION 5.1.5. Intercreditor Agreement. The Agents shall have received
executed counterparts of the Intercreditor Agreement, dated as of the Closing
Date, duly executed and delivered by all parties thereto.
SECTION 5.1.6. Closing Date Certificate. The Agents shall have received,
with counterparts for each Lender, the Closing Date Certificate, dated the
Closing Date and duly executed and delivered by an Authorized Officer of the
Borrower, in which certificate the Borrower shall agree and acknowledge that the
statements made therein shall be deemed to be true and correct representations
and warranties of the Borrower made as of such date under this Agreement, and,
at the time such certificate is delivered, such statements shall in fact be true
and correct. All documents and agreements required to be appended to the
Borrower Closing Date Certificate shall be in form and substance reasonably
satisfactory to the Administrative Agent.
SECTION 5.1.7. Subsidiary Guaranty. The Agents shall have received the
Subsidiary Guaranty, dated as of the Closing Date, duly executed and delivered
by an Authorized Officer of each Restricted Subsidiary (that is not a Foreign
Subsidiary of the Borrower) in existence on the Closing Date.
SECTION 5.1.8. Pledge and Security Agreements, etc. The Agents shall have
received executed counterparts of
(a) the Parent Guaranty and Pledge Agreement, dated as of the Closing
Date, duly executed by an Authorized Officer of Parent, together with (i)
the certificates evidencing all of the issued and outstanding shares of
Capital Stock of the Borrower pledged pursuant to the Parent Guaranty and
Pledge Agreement, which certificates shall in each case be accompanied by
undated stock powers duly executed in blank and (ii) all promissory notes
evidencing intercompany Indebtedness payable to Parent duly endorsed to the
order of the Administrative Agent, together with UCC financing statements
(Form UCC-1) (or similar instruments) in respect of such promissory notes
executed by Parent to be filed in such jurisdictions as the Administrative
Agent may reasonably request; and
(b) each Pledge and Security Agreement, dated as of the Closing Date,
duly executed and delivered by an Authorized Officer of the Borrower and
each Restricted Subsidiary, as applicable, together with
(i) the certificates evidencing all of the issued and outstanding
shares of Capital Stock pledged pursuant to the applicable Pledge and
Security Agreement, which certificates shall in each case be
accompanied by undated stock powers or powers of transfer duly
executed in blank, or, if any such shares of Capital Stock pledged
pursuant to such Pledge and Security Agreement are uncertificated
securities, the Administrative Agent shall have obtained "control" (as
defined in the UCC) over such shares of Capital Stock and such other
instruments and documents as the Administrative Agent shall deem
necessary or in the reasonable opinion of the Administrative Agent
desirable under applicable law to perfect the first priority security
interest of the
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Administrative Agent in such shares of Capital Stock; provided,
however, that notwithstanding the foregoing, no Foreign Subsidiary
shall be required to execute the Subsidiary Pledge and Security
Agreement, nor will the Borrower or any Restricted Subsidiary be
required to deliver in pledge pursuant to the applicable Pledge and
Security Agreement in excess of 65% of the total combined voting power
of all classes of Capital Stock of a Foreign Subsidiary entitled to
vote;
(ii) copies of UCC financing statements (Form UCC-1) (or similar
instruments) as may be acceptable to the Agents and suitable for
filing, naming such Obligor as the debtor and the Administrative Agent
as the secured party, or other similar instruments or documents
suitable for filing under the UCC of all jurisdictions as may be
necessary or, in the opinion of the Agents, desirable to perfect the
first priority security interest of the Administrative Agent in the
interests of such Obligor in the collateral pledged pursuant to the
applicable Pledge and Security Agreement;
(iii) executed copies of proper UCC termination statements (Form
UCC-3), if any, necessary to release all Liens and other rights of any
Person (other than Liens permitted under Section 7.2.3)
(A) in any collateral described in the applicable Pledge and
Security Agreement previously granted by any Person, and
(B) securing any of the Indebtedness to be repaid in
connection with the Transaction on or prior to the Closing Date,
together with such other UCC termination statements (Form UCC-3) as
the Agents may reasonably request from such Obligor; and
(iv) certified copies of UCC Requests for Information or Copies
(Form UCC-11), or a similar search report certified by a party
acceptable to the Agents, dated a date reasonably near to the Closing
Date, listing all effective financing statements, tax liens and
judgment liens which name such Obligor (under its present names and
any previous names) as the debtor and which are filed in the
jurisdictions in which filings were made pursuant to clause (ii)
above, together with copies of such financing statements (none of
which (other than (x) those described in clause (ii) above, if such
Form UCC-11 or search report, as the case may be, is current enough to
list such financing statements described in clause (ii) above and (y)
financing statements evidencing Liens permitted pursuant to Section
7.2.3) shall cover any collateral described in the applicable Pledge
and Security Agreement); and
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(c) the Agents and their counsel shall be satisfied that (i)
the Lien granted to the Administrative Agent in the collateral
described in the documents described above is a first priority
(or local equivalent thereof) security interest and (ii) no Lien
exists on any of the collateral described above other than the
Lien created in favor of the Administrative Agent pursuant to a
Loan Document.
SECTION 5.1.9. UCC Filing Service. All UCC financing statements (Form
UCC-1), termination statements (Form UCC-3) or other similar financing
statements required pursuant to the Loan Documents (collectively, the "Filing
Statements") shall have been delivered to CT Corporation System or another
similar filing service company reasonably acceptable to the Agents (the "Filing
Agent"). The Filing Agent shall have acknowledged in writing reasonably
satisfactory to the Agents and their counsel (i) the Filing Agent's receipt of
all such Filing Statements, (ii) that such Filing Statements have either been
submitted for filing in the appropriate filing offices therefor or will be
submitted for filing in such appropriate offices within ten days of the Closing
Date and (iii) that the Filing Agent will notify the Agents and their counsel of
the result of such submissions within 30 days of the Closing Date.
SECTION 5.1.10. Solvency Opinion, Solvency Certificate. The Agents shall
have received
(a) a solvency opinion from Valuation Research Corporation, addressed
to the Agents and each of the Lenders and dated the Closing Date, and
supporting the conclusions that after giving effect to the Transaction and
the incurrence of the financings contemplated herein, the Borrower (on a
stand alone basis) and Parent, the Borrower and the Borrower's Restricted
Subsidiaries (on a consolidated basis) are not insolvent and will not be
rendered insolvent by the indebtedness incurred in connection herewith,
will not be left with unreasonably small capital with which to engage in
their respective businesses and will not have incurred debts beyond their
ability to pay such debts as they mature and become due and otherwise in
form and substance satisfactory to the Agents; and
(b) the Solvency Certificate, dated the Closing Date, duly executed
and delivered by an Authorized Officer of Parent.
SECTION 5.1.11. Reliance Letters. The Agents shall, unless otherwise
agreed, have received reliance letters, each dated the Closing Date and
addressed to each Lender and each Agent, in respect of each of the legal
opinions delivered in connection with the Acquisition Transactions.
SECTION 5.1.12. Borrowing Base Certificate; Compliance Certificate. The
Agents shall have received, with copies for each Lender,
(a) an initial Borrowing Base Certificate, dated the Closing Date, in
respect of the Borrower's and its Restricted Subsidiaries' Eligible
Accounts and Eligible Inventory as of a recent date satisfactory to the
Agents, duly executed by the chief financial or accounting Authorized
Officer of the Borrower (and showing that the Borrowing Base Amount on the
Closing Date will exceed the initial Credit Extension by no less than
$50,000,000); and
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(b) an initial Compliance Certificate, dated the Closing Date and
prepared on a pro forma basis as if the Transaction had been consummated
and the initial Credit Extensions had been made as of December 31, 1998 and
as to such items therein as the Agents reasonably request, duly executed
(and with all schedules thereto duly completed) and delivered by the chief
financial or accounting Authorized Officer of the Borrower.
SECTION 5.1.13. Financial Information, etc. The Agents shall have received,
with copies for each Lender,
(a) the audited consolidated income and cash flow statements and
balance sheet of the Borrower and its Restricted Subsidiaries for the 1993
through 1998 Fiscal Years;
(b) the audited combined income and cash flow statements and balance
sheets of the IMC Businesses and their respective Subsidiaries for the 1996
through 1998 Fiscal Years;
(c) the unaudited pro forma combined income and cash flow statements
and balance sheets of the Borrower and its Restricted Subsidiaries
(following the Transaction and as if the Transaction had taken place prior
to the Fiscal Year starting on January 1, 1996) for the 1996 through 1998
Fiscal Years;
(d) the unaudited income and cash flow statements and balance sheets
of the Borrower and its Restricted Subsidiaries (following the Transaction
and as if the Transaction had taken place prior to the Fiscal Year starting
on January 1, 1999) for the first two Fiscal Months of 1999; and
(e) a pro forma consolidated opening balance sheet of Parent, as of
the Closing Date (the "Pro Forma Balance Sheet"), giving effect to the
consummation of the Transaction and reflecting the proposed legal and
capital structures of Parent and its Subsidiaries, which legal and capital
structure shall be satisfactory in all respects to the Agents,
in each case above, certified by the chief financial or accounting Authorized
Officer of the Borrower.
SECTION 5.1.14. Closing Fees, Expenses, etc. The Agents and the Co-Lead
Arrangers shall have received, each for its own respective account, or, in the
case of the Administrative Agent, for the account of each Lender, as the case
may be, all fees, costs and expenses due and payable pursuant to Sections 3.3
and 10.3, if then invoiced.
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SECTION 5.1.15. Payment of Outstanding Indebtedness, etc. All Indebtedness
identified in Item 7.2.2(b) ("Indebtedness to be Paid") of the Disclosure
Schedule (including amounts paid in connection with the Refinancing), together
with all interest, all prepayment premiums and other amounts due and payable
with respect thereto, shall have been paid in full (including, to the extent
necessary, from proceeds of the initial Borrowing hereunder), and all Liens
securing payment of any such Indebtedness shall have been released and the
Administrative Agent shall have received all executed UCC termination statements
(Form UCC-3) or other instruments as may be suitable or appropriate in
connection therewith, or, in each case, shall be the subject of a "payoff" or
"estoppel" letter in form and substance acceptable to the Agents.
SECTION 5.1.16. Insurance. The Agents shall have received reasonably
satisfactory evidence of the existence of insurance in compliance with Section
7.1.4 (including all endorsements included therein), and the Administrative
Agent shall be named additional insured or loss payee, on behalf of the Lenders,
pursuant to documentation reasonably satisfactory to the Agents and the
Borrower.
SECTION 5.1.17. Opinions of Counsel. The Agents shall have received
opinions, each dated the Closing Date and addressed to the Agents and all
Lenders, from
(a) ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, local Kentucky counsel to ▇▇▇▇▇▇, in form and
substance reasonably satisfactory to the Agents; and
(b) Dechert Price & ▇▇▇▇▇▇, special New York counsel to each of the
Obligors, in form and substance reasonably satisfactory to the Agents.
SECTION 5.2. All Credit Extensions. The obligation of each Lender and, if
applicable, the Issuer, to make any Credit Extension (including its initial
Credit Extension) shall be subject to the satisfaction of each of the conditions
precedent set forth in this Section 5.2.
SECTION 5.2.1. Compliance with Warranties, No Default, etc. Both before and
after giving effect to any Credit Extension the following statements shall be
true and correct:
(a) the representations and warranties set forth in Article VI and
in each other Loan Document shall, in each case, be true and correct in
all material respects with the same effect as if then made (unless stated
to relate solely to an earlier date, in which case such representations
and warranties shall be true and correct in all material respects as of
such earlier date);
(b) the sum of the (i) aggregate outstanding principal amount of all
Loans and (ii) the aggregate amount of all Letter of Credit Outstandings
does not exceed the lesser of (A) the then existing Revolving Loan
Commitment Amount and (B) the then applicable Borrowing Base Amount; and
(c) no Default shall have then occurred and be continuing.
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SECTION 5.2.2. Credit Extension Request. The Agents shall have received a
Borrowing Request if Loans are being requested, or an Issuance Request if a
Letter of Credit is being requested or extended. Each of the delivery of a
Borrowing Request or Issuance Request and the acceptance by the Borrower of
proceeds of any Credit Extension shall constitute a representation and warranty
by the Borrower that on the date of such Credit Extension (both immediately
before and after giving effect thereto and the application of the proceeds
thereof) the statements made in Section 5.2.1 are true and correct.
SECTION 5.2.3. Satisfactory Legal Form. All documents executed or submitted
pursuant hereto by or on behalf of the Borrower or any of its Restricted
Subsidiaries or any other Obligors shall be in form and substance reasonably
satisfactory to the Agents and their counsel; the Agents and their counsel shall
have received all information, approvals, opinions, documents or instruments as
the Agents or their counsel may reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders, the Issuer and the Agents to enter into
this Agreement and to make Credit Extensions hereunder, the Borrower represents
and warrants unto the Agents, the Issuer and each Lender as set forth in this
Article VI.
SECTION 6.1. Organization, etc. Each of the Borrower and its Restricted
Subsidiaries is validly organized and existing and in good standing under the
laws of the state or jurisdiction of its incorporation or organization, is duly
qualified to do business and is in good standing as a foreign entity in each
jurisdiction where the nature of its business requires such qualification,
except where the failure to be so qualified could not reasonably be expected to
have a Material Adverse Effect, and has full power and authority and holds all
requisite governmental licenses, permits and other approvals to enter into and
perform its Obligations under this Agreement and each other Loan Document to
which it is a party and to own and hold under lease its property, and to conduct
its business substantially as currently conducted by it, except where the
failure to hold such governmental licenses, permits and approvals could not
reasonably be expected to have a Material Adverse Effect.
SECTION 6.2. Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by the Borrower of this Agreement and each other Loan
Document executed or to be executed by it, the execution, delivery and
performance by each other Obligor of each Loan Document executed or to be
executed by it, the Borrower's and each such other Obligor's participation in
the consummation of all aspects of the Transaction in which the Borrower or such
other Obligor participates, and the execution, delivery and performance by the
Borrower or (if applicable) any Obligor of the agreements executed and delivered
in connection with the Transaction (including the Stock Purchase Agreement and
the First Mortgage Note Documents) are in each case within the Borrower's and
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each such other Obligor's powers, have been duly authorized by all necessary
action, and do not
(a) contravene any such Person's Organic Documents;
(b) contravene any material contractual restriction, law or
governmental regulation or court decree or order binding on or affecting
any such Person; or
(c) result in, or require the creation or imposition of, any Lien
(other than Liens permitted under the Loan Documents) on any such Person's
properties.
SECTION 6.3. Government Approval, Regulation, etc. No authorization or
approval or other action by, and no notice to or filing with, any Governmental
Authority or regulatory body or other Person (other than those that have been,
or on the Closing Date will be, duly obtained or made and which are, or on the
Closing Date will be, in full force and effect) is required for the consummation
of the Transaction or the due execution, delivery or performance by the Borrower
or any other Obligor of any Loan Document to which it is a party, or for the due
execution, delivery and/or performance of Transaction Documents, in each case by
the parties thereto or the consummation of the Transaction, except for any of
the foregoing, the failure of which to make or obtain such authorization or
approval (individually or in the aggregate) could not reasonably be expected to
have a Material Adverse Effect. Neither the Borrower nor any of its Subsidiaries
is an "investment company" within the meaning of the Investment Company Act of
1940, as amended, or a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company", within the meaning of the Public Utility
Holding Company Act of 1935, as amended.
SECTION 6.4. Validity, etc. This Agreement and the Transaction Documents to
which it is a party constitute, and each other Loan Document executed by the
Borrower will, on the due execution and delivery thereof, constitute, the legal,
valid and binding obligations of the Borrower, enforceable against the Borrower
in accordance with their respective terms; and each other Loan Document executed
by each other Obligor will, on the due execution and delivery thereof by such
Obligor, constitute the legal, valid and binding obligation of such Obligor
enforceable against such Obligor in accordance with its terms (except, in any
case, as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights generally
and by principles of equity).
SECTION 6.5. Financial Information. The financial statements of the
Borrower and its Restricted Subsidiaries furnished to the Agents and each Lender
pursuant to (i) clauses (a) and (b) of Section 5.1.13 have been prepared in
accordance with GAAP consistently applied and (ii) clauses (c), (d) and (e) of
Section 5.1.13 have been prepared in accordance with Regulation S-X promulgated
under the Securities Act of 1933, as amended, and, in each case, present fairly
the consolidated financial condition of the Persons covered thereby as at the
dates thereof and the results of their operations for the periods then ended.
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All balance sheets, all statements of operations, shareholders' equity and cash
flow and all other financial information of each of the Borrower and its
Restricted Subsidiaries furnished pursuant to Section 7.1.1 have been and will
for periods following the Closing Date be prepared in accordance with GAAP
consistently applied, and do or will present fairly the consolidated financial
condition of the Persons covered thereby as at the dates thereof and the results
of their operations for the periods then ended.
SECTION 6.6. No Material Adverse Change. There has been no material adverse
change in the financial condition, results of operations, assets, business,
properties or, other than with respect to forecast weather conditions, prospects
of the Borrower and its Subsidiaries, taken as a whole, or each of the IMC
Businesses and their respective Subsidiaries, in each case taken as a whole,
since December 31, 1998.
SECTION 6.7. Litigation, Labor Controversies, etc. There is no pending or,
to the knowledge of the Borrower or any of its Subsidiaries, threatened
litigation, action, proceeding or labor controversy
(a) except as disclosed in Item 6.7 ("Litigation") of the Disclosure
Schedule, affecting the Borrower, any of its Subsidiaries or any other
Obligor, or any of their respective properties, businesses, assets or
revenues, which could reasonably be expected to have a Material Adverse
Effect, and no development has occurred in any labor controversy,
litigation, arbitration or governmental investigation or proceeding
disclosed in Item 6.7 which could reasonably be expected to have a Material
Adverse Effect (provided, however, that the aggregate amount of liability
of the Borrower and its Restricted Subsidiaries in respect of the labor
controversies, litigations, arbitrations, governmental investigations and
proceedings set forth in Item 6.7 ("Litigation") of the Disclosure Schedule
will not exceed $3,500,000); or
(b) which purports to affect the legality, validity or enforceability
of this Agreement, any other Loan Document, the Transaction Documents or
the Transaction.
SECTION 6.8. Subsidiaries. The Borrower has no Subsidiaries, except those
Subsidiaries
(a) which are identified in Item 6.8 ("Existing Subsidiaries") of the
Disclosure Schedule; or
(b) which are permitted to have been organized or acquired in
accordance with Section 7.2.5 or 7.2.8.
SECTION 6.9. Ownership of Properties. Each Obligor owns (a) in the case of
owned real property, good and marketable fee title to, and (b) in the case of
owned personal property, good and valid title to, or, in the case of leased real
or personal property, valid and enforceable leasehold interests (as the case may
be) in, all of its properties and assets, real and personal, tangible and
intangible, of any nature whatsoever, free and clear in each case of all Liens
or claims, except for Liens permitted pursuant to Section 7.2.3, except where
the failure to have such title could not reasonably be expected to have a
Material Adverse Effect.
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SECTION 6.10. Taxes. Each Obligor has filed all tax returns and reports
required by law to have been filed by it and has paid all Taxes and governmental
charges thereby shown to be due and owing, except any such Taxes or charges
which are being diligently contested in good faith by appropriate proceedings
and for which adequate reserves in accordance with GAAP shall have been set
aside on its books, except where the failure to pay such Taxes (individually or
in the aggregate) could not reasonably be expected to have a Material Adverse
Effect.
SECTION 6.11. Pension and Welfare Plans. During the twelve-consecutive-
month period prior to the date of the execution and delivery of this Agreement
and prior to the date of any Credit Extension hereunder, no steps have been
taken to terminate any Pension Plan, and no contribution failure has occurred
with respect to any Pension Plan sufficient to give rise to a Lien under section
302(f) of ERISA. No condition exists or event or transaction has occurred with
respect to any Pension Plan which might result in the incurrence by the Borrower
or any member of the Controlled Group of any material liability, fine or
penalty. Except as disclosed in Item 6.11 ("Employee Benefit Plans") of the
Disclosure Schedule, neither the Borrower nor any member of the Controlled Group
has any contingent liability with respect to any post-retirement benefit under a
Welfare Plan, other than liability for continuation coverage described in Part 6
of Subtitle B of Title I of ERISA.
SECTION 6.12. Environmental Warranties. Except as set forth in Item 6.12
("Environmental Matters") of the Disclosure Schedule:
(a) all facilities and property (including underlying groundwater)
owned or leased by the Borrower or any of its Subsidiaries are in material
compliance with all Environmental Laws;
(b) there have been no past unresolved, and there are no pending or,
to the Borrower's knowledge, threatened
(i) claims, complaints, notices or requests for information
received by the Borrower or any of its Subsidiaries with respect to
any alleged violation of any Environmental Law, or
(ii) complaints, notices or inquiries to the Borrower or any of
its Subsidiaries regarding potential liability under any Environmental
Law that, in either case, have, or could reasonably be expected to
have, a Material Adverse Effect;
(c) there have been no Releases of Hazardous Materials at, on or under
any property now or previously owned or leased by the Borrower or any of
its Subsidiaries that have, or could reasonably be expected to have, a
Material Adverse Effect;
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(d) the Borrower and its Subsidiaries have been issued and are in
material compliance with all permits, certificates, approvals, licenses and
other authorizations relating to environmental matters;
(e) no property now or, to the knowledge of the Borrower, previously
owned or leased by the Borrower or any of its Subsidiaries is listed or
proposed for listing (with respect to owned property only) on the National
Priorities List pursuant to CERCLA or on any similar state list of sites
requiring investigation or clean-up;
(f) there are no underground storage tanks, active or, to the
knowledge of the Borrower, abandoned, including petroleum storage tanks, on
or under any property now or, to the knowledge of the Borrower, when owned
or leased by the Borrower or any of its Subsidiaries that, singly or in the
aggregate, have, or could reasonably be expected to have, a Material
Adverse Effect;
(g) to the knowledge of the Borrower, neither the Borrower nor any
Subsidiary has directly transported or directly arranged for the
transportation of any Hazardous Material to any location which is listed or
proposed for listing on the National Priorities List pursuant to CERCLA or
on any similar state list or which is the subject of federal, state or
local enforcement actions or other investigations which may lead to claims
against the Borrower or such Subsidiary for any remedial work, damage to
natural resources or personal injury, including claims under CERCLA that
have, or could reasonably be expected to have, a Material Adverse Effect;
and
(h) there are no polychlorinated biphenyls or friable asbestos present
at any property now owned or leased by the Borrower or any Subsidiary that,
singly or in the aggregate, have, or could reasonably be expected to have,
a Material Adverse Effect;
provided, however, that the aggregate amount of liability of the Borrower and
its Restricted Subsidiaries in respect of the items set forth in Item 6.12
("Environmental Matters") of the Disclosure Schedule will not exceed $5,000,000.
SECTION 6.13. Accuracy of Information. None of the factual information
heretofore or contemporaneously furnished in writing to the Agents, the Issuer,
the Co-Lead Arrangers or any Lender by or on behalf of the Borrower or any other
Obligor for purposes of or in connection with this Agreement or any transaction
contemplated hereby (including the Transaction) (true and complete copies of
which were furnished to the Agents, the Issuer, the Co-Lead Arrangers and each
Lender requesting a copy thereof in connection with its execution and delivery
hereof), contains any untrue statement of a material fact, and no other factual
information hereafter furnished in connection with this Agreement or any other
Loan Document by the Borrower or any other Obligor to the Agents, the Issuer,
the Co-Lead Arrangers or any Lender will contain any untrue statement of a
material fact on the date as of which such information is dated or certified
and, as of the date of the execution and delivery of this Agreement by the
Agents, the Issuer, the Co-Lead Arrangers and each of the Lenders, the
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information delivered prior to the date of execution and delivery of this
Agreement (unless such information specifically relates to a prior date) does
not, and the factual information hereafter furnished shall not on the date as of
which such information is dated or certified, omit to state any material fact
necessary to make any information not misleading.
SECTION 6.14. Regulations U and X. No Obligor is engaged in the business of
extending credit for the purpose of purchasing or carrying margin stock, and no
proceeds of any Credit Extensions will be used to purchase or carry margin stock
or otherwise for a purpose which violates, or would be inconsistent with, F.R.S.
Board Regulation U or Regulation X. Terms for which meanings are provided in
F.R.S. Board Regulation U or Regulation X or any regulations substituted
therefor, as from time to time in effect, are used in this Section with such
meanings.
SECTION 6.15. Year 2000. Each Obligor has reviewed the areas within its
business and operations which could be adversely affected by, and has developed
or is developing a program (which program is expected to be completed and in
place by June 30, 1999) to address on a timely basis, the "Year 2000 Problem"
(that is, the risk that computer applications used by such Obligor may be unable
to recognize and properly perform date-sensitive functions involving certain
dates prior to and any date after December 31, 1999). Based on such review and
program, the Year 2000 Problem could not reasonably be expected to have a
Material Adverse Effect.
SECTION 6.16. Status of Obligations as Senior Indebtedness; First Mortgage
Note Offering; First Mortgage Notes; etc. (a) The Borrower has the power and
authority to incur the Senior Indebtedness as provided for under the First
Mortgage Note Documents applicable thereto and has duly authorized, executed and
delivered the First Mortgage Note Documents applicable to such Senior
Indebtedness. The Borrower has issued, pursuant to due authorization, the Senior
Indebtedness under the applicable First Mortgage Note Documents, and such First
Mortgage Note Documents constitute the legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with its terms
(except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights generally
and by principles of equity).
(b) The First Mortgage Notes have been issued and sold to the initial
purchasers thereof on or prior to the Closing Date in accordance with and
pursuant to the terms of the Offering Memorandum and in compliance with all
laws, including Rule 144A of the Securities Act of 1933, as amended and all
other applicable federal and state securities laws. All representations and
warranties of the Borrower and each other applicable Obligor contained in the
purchase agreement relating to the First Mortgage Notes are true and correct in
all material respects as of the Closing Date.
SECTION 6.17. Solvency. The Transaction (including the incurrence of the
initial Credit Extension hereunder, the execution and delivery by each
Restricted Subsidiary of the Subsidiary Guaranty and the application of the
proceeds of the Credit Extensions), will not involve or result in any fraudulent
transfer or fraudulent conveyance under the provisions of Section 548 of the
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Bankruptcy Code (11 U.S.C. ss.101 et seq., as from time to time hereafter
amended, and any successor or similar statute) or any applicable state law
respecting fraudulent transfers or fraudulent conveyances. On the Closing Date,
after giving effect to the Transaction and the making of each Credit Extension
made on the Closing Date and after giving effect to the application of the
proceeds of such Credit Extensions, the Borrower and each Subsidiary is Solvent.
ARTICLE VII
COVENANTS
SECTION 7.1. Affirmative Covenants. The Borrower agrees with the Agents,
each Lender and the Issuer that, until the Termination Date, the Borrower will
perform, or cause to be performed, the obligations set forth in this Section
7.1.
SECTION 7.1.1. Financial Information, Reports, Notices, etc. The Borrower
will furnish, or will cause to be furnished, to each Lender and each Agent
copies of the following financial statements, reports, notices and information:
(a) (i) as soon as available and in any event within 45 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year of the
Borrower, a copy of the consolidated and consolidating balance sheet of the
Borrower and its Restricted Subsidiaries as of the end of such Fiscal
Quarter, and the related consolidated and consolidating statements of
income and cash flow of the Borrower and its Restricted Subsidiaries for
such Fiscal Quarter and for the period commencing at the end of the
previous Fiscal Year and ending with the end of such Fiscal Quarter, and,
in each case, setting forth in comparative form (A) the figures for the
same quarterly accounting periods ending in the immediately preceding
Fiscal Year and (B) the figures for the same quarterly accounting periods
reflected in the financial projections most recently delivered (either
prior to the Closing Date or pursuant to clause (i) of Section
7.1.1)(provided, that, with respect to clause (A), for the first four
Fiscal Quarters following the Closing Date, the Borrower shall be required
to provide comparisons with respect to income statements only), certified
by the chief financial or chief accounting Authorized Officer of the
Borrower and (ii) as soon as available and in any event within 30 days
after the end of each Fiscal Month of the Borrower, a copy of the
consolidated and consolidating balance sheet of the Borrower and its
Restricted Subsidiaries as of the end of such Fiscal Month, and the related
consolidated and consolidating statements of income and cash flow of the
Borrower and its Restricted Subsidiaries for such Fiscal Month and for the
period commencing at the end of the previous Fiscal Year and ending with
the end of such Fiscal Month, and, in each case, setting forth in
comparative form (A) the figures for the same monthly accounting periods
ending in the immediately preceding Fiscal Year and (B) the figures for the
same monthly accounting periods reflected in the financial projections most
recently delivered (either prior to the Closing Date or pursuant to clause
(i) of Section 7.1.1)(provided, that, with respect to clause (A), for the
first twelve Fiscal Months following the Closing Date, the Borrower shall
be required to provide comparisons with respect to income statements only),
certified by the chief financial or chief accounting Authorized Officer of
the Borrower;
77
(b) as soon as available and in any event within 90 days after the
end of each Fiscal Year of the Borrower, a copy of the consolidated and
consolidating balance sheet of the Borrower and its Restricted
Subsidiaries, and the related consolidated and consolidating statements of
income and cash flow of the Borrower and its Restricted Subsidiaries for
such Fiscal Year, setting forth in comparative form (A) the figures for
the immediately preceding Fiscal Year and (B) the figures for the same
period reflected in the financial projections most recently delivered
(either prior to the Closing Date or pursuant to clause (i) of Section
7.1.1)(provided, that, with respect to clause (A), for the first Fiscal
Year following the Closing Date, the Borrower shall be required to provide
comparisons with respect to income statements only), audited (without any
Impermissible Qualification) by independent public accountants acceptable
to the Agents, which shall include a calculation of the financial
covenants set forth in Section 7.2.4 and stating that, in performing the
examination necessary to deliver the audited financial statements of the
Borrower, no knowledge was obtained of any Event of Default;
(c) together with the delivery of the financial information pursuant
to clause (a)(i) and clause (b), a Compliance Certificate, executed by the
chief financial or chief accounting Authorized Officer of the Borrower,
showing (in reasonable detail and with appropriate calculations and
computations in all respects satisfactory to the Agents) compliance with
the financial covenants set forth in Section 7.2.4 and stating that no
Default has occurred and is continuing (or, if a Default has occurred,
specifying the details of such Default and the action that the Borrower or
such Obligor has taken or proposes to take with respect thereto);
(d) as soon as possible and in any event within three Business Days
after the Borrower or any other Obligor obtains knowledge (or could
reasonably be expected to have obtained knowledge) of the occurrence of a
Default, a statement of an Authorized Officer of the Borrower setting
forth details of such Default and the action that the Borrower or such
Obligor has taken and proposes to take with respect thereto;
(e) as soon as possible and in any event within three Business Days
after (i) the occurrence of any material adverse development with respect
to any litigation, action, proceeding, or labor controversy described in
Item 6.7 ("Litigation") of the Disclosure Schedule or (ii) the
commencement of any litigation, action, proceeding or labor controversy of
the type described in Section 6.7, notice thereof and, to the extent the
Agents request, copies of all documentation relating thereto;
(f) promptly after the sending or filing thereof, copies of all
reports which the Borrower sends to any of its security holders generally
in their capacity as security holders, and all reports, notices,
prospectuses and registration statements which any Obligor files with the
Securities and Exchange Commission or any national securities exchange;
78
(g) promptly upon becoming aware of (i) the institution of any steps
by any Person to terminate any Pension Plan, (ii) the failure to make a
required contribution to any Pension Plan if such failure is sufficient to
give rise to a Lien under section 302(f) of ERISA, (iii) the taking of any
action with respect to a Pension Plan which could result in the
requirement that any Obligor furnish a bond or other security to the PBGC
or such Pension Plan, (iv) the occurrence of any event with respect to any
Pension Plan which could result in the incurrence by any Obligor of any
material liability, fine or penalty or (v) any material increase in the
contingent liability of any Obligor with respect to any post-retirement
Welfare Plan benefit, notice thereof and copies of all documentation
relating thereto;
(h) promptly upon receipt thereof, copies of all "management
letters" submitted to the Borrower or any other Obligor by the independent
public accountants referred to in clause (b) in connection with each audit
made by such accountants;
(i) promptly when available and in any event within 60 days
following the last day of each Fiscal Year of the Borrower, financial
projections for the Borrower and its Restricted Subsidiaries, on a
consolidated and consolidating basis (including an operating budget), for
the current Fiscal Year, prepared in reasonable detail by the chief
accounting or financial Authorized Officer of the Borrower;
(j) within 10 Business Days after the end of each semi-monthly
period, a Borrowing Base Certificate that is calculated as of the
fifteenth day and the last day of each Fiscal Month;
(k) within 30 days after the end of each Fiscal Quarter, or as
requested by any Agent from time to time: (i) a detailed aged trial
balance and a detailed summary of all Accounts indicating which Accounts
are thirty, sixty and ninety days past due and listing the names of all
Account Debtors, (ii) a detailed listing and a detailed summary of the
Borrower's accounts payable indicating which accounts payable are more
than thirty days past due, (iii) detailed inventory listings and a
detailed inventory listing summary, and (iv) a reconciliation of Accounts,
accounts payable and inventory to the financial statements delivered
pursuant to clause (a) of this Section 7.1.1 and to the Borrowing Base
Certificate delivered pursuant to clause (j) of this Section 7.1.1 for
each Fiscal Month which is the last Fiscal Month of a Fiscal Quarter;
provided, however, that the Borrower will only have to provide the
detailed listings in clause (i), (ii) and (iii) above to the
Administrative Agent. The Borrower will only distribute such detailed
listings to a Lender requesting such listings; and
(l) such other information relating to the condition or operations,
financial or otherwise, of the Borrower or any of its Restricted
Subsidiaries or any other Obligor as any Lender through the Administrative
Agent may from time to time reasonably request.
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SECTION 7.1.2. Maintenance of Existence. The Borrower will, and will cause
each of its Subsidiaries to, comply in all material respects with all applicable
laws, rules, regulations and orders, such compliance to include (without
limitation):
(a) the maintenance and preservation of its corporate existence and
qualification as a foreign corporation, except where the failure to so
qualify could not reasonably be expected to have a Material Adverse
Effect; and
(b) the payment, before the same become delinquent, of all material
Taxes, assessments and governmental charges imposed upon the Borrower or
its Subsidiaries or upon their property except to the extent being
diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside
on the books of the Borrower or its Subsidiaries, as applicable.
SECTION 7.1.3. Maintenance of Properties. The Borrower will, and will cause
each of its Subsidiaries to, maintain, preserve, protect and keep its and their
respective properties in good repair, working order and condition (ordinary wear
and tear excepted), and make necessary and proper repairs, renewals and
replacements so that its business carried on by the Borrower and its
Subsidiaries may be properly conducted at all times unless the Borrower or such
Subsidiary determines in good faith that the continued maintenance of such
property is no longer economically desirable.
SECTION 7.1.4. Insurance. (a) The Borrower will, and will cause each of its
Restricted Subsidiaries to maintain (i) insurance on its property with
financially sound and reputable insurance companies against loss and damage in
at least the amounts (and with only those deductibles) customarily maintained,
and against such risks as are typically insured against in the same general
area, by Persons of comparable size engaged in the same or similar business as
the Borrower and its Subsidiaries and (ii) all worker's compensation, employer's
liability insurance or similar insurance as may be required under the laws of
any state or jurisdiction in which it may be engaged in business.
(b) Without limiting clause (a) above, all insurance policies required
pursuant to this Section shall (a) name the Administrative Agent, on behalf of
Secured Parties, as additional insured, and provide that no cancellation or
modification of the policies will be made without thirty days' prior written
notice to the Administrative Agent and (b) be in addition to any requirements to
maintain specific types of insurance contained in the other Loan Documents.
SECTION 7.1.5. Books and Records. The Borrower will, and will cause each of
its Restricted Subsidiaries to, keep books and records in accordance with GAAP
which accurately reflect all of its business affairs and transactions and permit
the Agents, the Issuer and each Lender or any of their respective
representatives, at reasonable times and intervals and after reasonable notice
to the Borrower, (a) to visit each Obligor's offices and any other place where
"Collateral" (as defined in the applicable Pledge and Security Agreement) is
located, (b) to discuss such Obligor's financial matters with its officers and
80
employees and its independent public accountants (and the Borrower hereby
authorizes such independent public accountant to discuss the Borrower's and each
Obligor's financial matters with each Lender or its representatives whether or
not any representative of the Borrower is present) and (c) to examine (and, at
the expense of the Borrower, photocopy extracts from) any of its books or other
corporate records. The Borrower shall pay any fees of such independent public
accountant incurred in connection with any Agent's, the Issuer's or any Lender's
exercise of its rights pursuant to this Section.
SECTION 7.1.6. Environmental Covenant. The Borrower will, and will cause
each of its Subsidiaries to,
(a) use and operate all of its and their facilities and properties in
material compliance with all Environmental Laws, keep all material permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material compliance with
all applicable Environmental Laws;
(b) promptly notify the Agents and provide copies upon receipt of all
written claims, complaints, notices or inquiries of a nature relating to
the condition of its facilities and properties in respect of, or as to
compliance with, Environmental Laws (which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect)
and shall resolve any non-compliance with Environmental Laws within the
time period required by such Environmental Laws and keep its property free
of any Lien imposed by any Environmental Law; and
(c) provide such information and certifications which the Agents may
reasonably request from time to time to evidence compliance with this
Section 7.1.6.
SECTION 7.1.7. Future Subsidiaries. Upon any Person becoming, after the
Closing Date, a Restricted Subsidiary, or upon the Borrower or any Restricted
Subsidiary acquiring additional Capital Stock of any existing Restricted
Subsidiary, the Borrower shall promptly notify the Agents of such acquisition,
and
(a) the Borrower shall promptly cause such Restricted Subsidiary to
execute and deliver to the Administrative Agent, with counterparts for each
Lender, a supplement to the Subsidiary Guaranty and a supplement to the
Subsidiary Pledge and Security Agreement, together with acknowledgment
copies of UCC financing statements (Form UCC-1) executed and delivered by
the Restricted Subsidiary naming the Restricted Subsidiary as the debtor
and the Administrative Agent as the secured party, or other similar
instruments or documents, filed under the UCC in all jurisdictions as may
be necessary or, in the opinion of the Administrative Agent, desirable to
perfect the security interest of the Administrative Agent pursuant to the
Subsidiary Pledge and Security Agreement (other than the perfection of
security interests in motor vehicles owned as of the date such entity
becomes a Restricted Subsidiary); and
81
(b) the Borrower shall promptly deliver, or cause to be delivered, to
the Administrative Agent under a supplement to a Pledge Agreement
certificates (if any) representing all of the issued and outstanding shares
of Capital Stock of such Restricted Subsidiary or Foreign Subsidiary owned
by the Borrower or any Restricted Subsidiary, as the case may be, along
with undated stock powers for such certificates, executed in blank, or, if
any securities subject thereto are uncertificated securities, confirmation
and evidence satisfactory to the Agents that appropriate book entries have
been made in the relevant books or records of a securities intermediary or
the issuer of such securities, as the case may be, or other appropriate
steps shall have been taken under applicable law resulting in the
perfection of the security interest granted in favor of the Administrative
Agent pursuant to the terms of a Pledge Agreement;
together, in each case, with such opinions, in form and substance and from
counsel reasonably satisfactory to the Agents, as the Agents may reasonably
request; provided, however, that notwithstanding the foregoing, no Foreign
Subsidiary shall be required to execute and deliver a supplement to the
Subsidiary Guaranty or a supplement to the Subsidiary Pledge and Security
Agreement, nor will the Borrower or any Restricted Subsidiary be required to
deliver in pledge pursuant to a Pledge Agreement in excess of 65% of the total
combined voting power of all classes of Capital Stock of a Foreign Subsidiary
entitled to vote.
SECTION 7.1.8. Use of Proceeds. The Borrower shall apply the proceeds of
the Credit Extensions as follows:
(a) to consummate the Acquisition Transactions;
(b) in connection with the Refinancing, to make payment in full of all
Indebtedness identified in Item 7.2.2(b) ("Indebtedness to be Paid") of the
Disclosure Schedule;
(c) to pay reasonable costs, fees and expenses related to the
Transaction, which costs, fees and expenses shall be reasonably
satisfactory to the Agents; and
(d) for working capital and general corporate purposes of the Borrower
and its Restricted Subsidiaries, including Permitted Acquisitions by such
Persons.
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SECTION 7.1.9. Cash Management Accounts. The Borrower shall
(a) within 10 Business Days of the Closing Date establish cash
management accounts subject to the control of the Administrative Agent, all
on terms and conditions and pursuant to documentation satisfactory to the
Administrative Agent and the Syndication Agent;
(b) provide instructions to the appropriate Person as often as
necessary to ensure that any and all amounts deposited in any such account
are transferred, either directly or indirectly, to the Administrative
Agent, to be applied against any outstanding Loans; and
(c) not close or transfer any such account, or open any new deposit
account, in any case without the prior written consent of the
Administrative Agent.
SECTION 7.2. Negative Covenants. The Borrower covenants and agrees with the
Agents, the Issuer and each Lender that, until the Termination Date, the
Borrower will, and will cause its Restricted Subsidiaries to, perform or cause
to be performed, the obligations set forth in this Section 7.2.
SECTION 7.2.1. Business Activities. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, engage in any business activity,
except for any business in which the Borrower and its Restricted Subsidiaries
are engaged on the Effective Date and such businesses as may be incidental,
similar or related thereto.
SECTION 7.2.2. Indebtedness. The Borrower will not, and will not permit any
of its Restricted Subsidiaries to, create, incur, assume or suffer to exist
("Incur") or otherwise become or be liable in respect of any Indebtedness, other
than, without duplication, the following:
(a) Indebtedness in respect of the Obligations;
(b) until the Closing Date, Indebtedness that is to be repaid in full
as further identified in Item 7.2.2(b) ("Indebtedness to be Paid") of the
Disclosure Schedule;
(c) Indebtedness existing as of the Effective Date which is identified
in Item 7.2.2(c) ("Ongoing Indebtedness") of the Disclosure Schedule;
(d) unsecured Indebtedness (i) incurred in the ordinary course of
business of the Borrower and its Restricted Subsidiaries (including open
accounts extended by suppliers on normal trade terms in connection with
purchases of goods and services which are not overdue for a period of more
than 90 days or, if overdue for more than 90 days, as to which a dispute
exists and adequate reserves in conformity with GAAP have been established
on the books of the Borrower or such Restricted Subsidiary) and (ii) in
respect of performance, surety or appeal bonds provided in the ordinary
course of business, but excluding (in each case), Indebtedness incurred
through the borrowing of money or Contingent Liabilities in respect
thereof;
83
(e) Indebtedness (i) in respect of industrial revenue bonds or other
similar governmental or municipal bonds, (ii) evidencing the deferred
purchase price of newly acquired property or incurred to finance the
acquisition of equipment of the Borrower and its Restricted Subsidiaries
(pursuant to purchase money mortgages or otherwise, whether owed to the
seller or a third party) used in the ordinary course of business of the
Borrower and its Restricted Subsidiaries (provided, that such Indebtedness
is incurred within 60 days of the acquisition of such property) and (iii)
Capitalized Lease Liabilities; provided, that the aggregate amount of all
Indebtedness outstanding pursuant to this clause (e) shall not at any time
exceed $5,000,000; provided, further, that neither the Borrower nor any
Restricted Subsidiary may have any Contingent Liability in respect of such
Indebtedness incurred by any Foreign Subsidiary;
(f) Indebtedness of any Restricted Subsidiary owing to the Borrower or
any Restricted Subsidiary, which Indebtedness (i) shall be evidenced by a
promissory note in form and substance satisfactory to the Administrative
Agent, duly executed and delivered in pledge to the Administrative Agent
pursuant to a Loan Document, and shall not be forgiven or otherwise
discharged for any consideration other than payment in full or in part in
cash (provided, that only the amount repaid in part shall be discharged);
and (ii) if incurred by a Foreign Subsidiary owing to the Borrower or a
Restricted Subsidiary, shall not (when aggregated with the amount of
Investments made by the Borrower and the Restricted Subsidiaries in Foreign
Subsidiaries under clause (e) of Section 7.2.5), exceed $1,000,000;
(g) Indebtedness of the Borrower evidenced by the First Mortgage
Notes, and Indebtedness of each Restricted Subsidiary in respect of its
guarantee of such First Mortgage Notes;
(h) Indebtedness of a Person existing at the time such Person became a
Restricted Subsidiary in an amount not to exceed $1,500,000, but only to
the extent that such Indebtedness was not created or incurred in
contemplation of such Person becoming a Restricted Subsidiary; provided,
that neither the Borrower nor any Restricted Subsidiary may have any
Contingent Liability in respect of such Indebtedness incurred by any
Foreign Subsidiary;
(i) Hedging Obligations (other than with respect to Commodity Hedging
Agreements) of the Borrower or any of its Restricted Subsidiaries in
respect of the Loans;
(j) Hedging Obligations of the Borrower or any of its Restricted
Subsidiaries in respect of Commodity Hedging Agreements in an aggregate
notional amount not to exceed $1,000,000 at any time outstanding;
84
(k) unsecured Indebtedness of the Borrower evidenced by seller notes
issued in connection with any Permitted Acquisition, the aggregate amount
of which seller notes shall not exceed $10,000,000 at any time outstanding;
(l) unsecured Indebtedness of the Borrower evidenced by seller notes
issued in connection with any Permitted Acquisition; provided, that such
seller notes shall (i) be subordinated in right of payment to the payment
in full in cash of the Indebtedness in respect of the Obligations, (ii) be
non-cash pay or pay-in-kind notes, (iii) not have a maturity date prior to
the Stated Maturity Date and (iv) in any event, be issued on terms and
pursuant to documentation in all material respects reasonably satisfactory
to the Agents; and
(m) other Indebtedness of the Borrower and its Restricted Subsidiaries
(other than Indebtedness of Foreign Subsidiaries owing to the Borrower or
any Restricted Subsidiary that is not a Foreign Subsidiary) in an aggregate
amount at any time outstanding not to exceed $4,000,000;
provided, however, that (i) no Indebtedness otherwise permitted by clause (e),
(f)(ii), (h) or (m) shall be assumed or otherwise Incurred if a Default has
occurred and is then continuing or would result therefrom, (ii) Indebtedness
permitted by clause (a) may be refinanced, refunded, renewed, or extended in
accordance with Section 7.2.10, (iii) Indebtedness evidenced by each of the
Seller Notes and the 399VP Notes shall not be exchanged for First Mortgage Notes
without the consent of the Required Lenders and (iv) Indebtedness permitted
under clause (k) shall be exclusive of any Indebtedness permitted under clause
(l).
SECTION 7.2.3. Liens. The Borrower will not, and will not permit any of its
Restricted Subsidiaries to, Incur any Lien upon any of its property, revenues or
assets, whether now owned or hereafter acquired, except:
(a) Liens securing payment of the Obligations;
(b) until the Closing Date, Liens securing payment of Indebtedness of
the type described in clause (b) of Section 7.2.2;
(c) Liens existing as of the Effective Date and disclosed in Item
7.2.3(c) ("Ongoing Liens") of the Disclosure Schedule securing Indebtedness
described in clause (c) of Section 7.2.2, and refinancings of such
Indebtedness; provided, that no such Lien shall encumber any additional
property and the amount of Indebtedness secured by such Lien is not
increased from that existing on the Effective Date (as such Indebtedness
may have been permanently reduced subsequent to the Effective Date);
(d) Liens securing Indebtedness of the type permitted under clause (e)
of Section 7.2.2; provided, that such Lien (i) is granted within 60 days
85
after such Indebtedness is incurred and (ii) secures only the assets that
are the subject of the Indebtedness referred to in such clause;
(e) Liens securing Indebtedness permitted by clause (h) of Section
7.2.2; provided, that such Liens existed prior to such Person becoming a
Restricted Subsidiary, were not created in anticipation thereof and attach
only to specific tangible assets of such Person (and not assets of such
Person generally);
(f) Liens in favor of carriers, warehousemen, mechanics, materialmen
and landlords granted in the ordinary course of business for amounts not
overdue or being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall
have been set aside on its books;
(g) Liens incurred or deposits made in the ordinary course of business
in connection with workmen's compensation, unemployment insurance or other
forms of governmental insurance or benefits, or to secure performance of
tenders, statutory obligations, bids, leases or other similar obligations
(other than for borrowed money) entered into in the ordinary course of
business or to secure obligations on surety and appeal bonds or performance
bonds;
(h) judgment Liens in existence for less than 45 days after the entry
thereof or with respect to which execution has been stayed or the payment
of which is covered in full (subject to a customary deductible) by
insurance maintained with responsible insurance companies and which do not
otherwise result in an Event of Default under Section 8.1.6;
(i) easements, rights-of-way, zoning restrictions, minor defects or
irregularities in title and other similar encumbrances not interfering in
any material respect with the value or use of the property to which such
Lien is attached;
(j) Liens for Taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside
on its books;
(k) Liens on the Fixed Assets of the Borrower, its Restricted
Subsidiaries and each Farmarkets Subsidiary securing the First Mortgage
Notes; and
(l) Liens securing Indebtedness permitted by clause (m) of Section
7.2.2; provided, that the aggregate amount of Indebtedness secured thereby
shall not exceed $1,500,000 at any time outstanding.
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SECTION 7.2.4. Financial Covenants.
(a) Interest Coverage Ratio. The Borrower will not permit the Interest
Coverage Ratio as of the last day of any Fiscal Quarter occurring during
any period set forth below to be less than the ratio set forth opposite
such period:
Interest Coverage
Period Ratio
------ -----------------
Closing Date to 06/30/99 1.75:1
07/01/99 to 09/30/99 1.85:1
10/01/99 to 03/31/00 2.00:1
04/01/00 to 09/30/00 2.25:1
10/01/00 and thereafter 2.50:1
(b) Current Ratio. The Borrower will not permit the Current Ratio as
of the last day of any Fiscal Quarter occurring during any period set forth
below to be less than the ratio set forth opposite such period:
Period Current Ratio
------ -------------
Closing Date to 06/30/00 1.00:1
07/01/00 to 12/31/00 1.10:1
01/01/01 to 12/31/01 1.20:1
01/01/02 and thereafter 1.30:1
(c) Leverage Ratio. The Borrower will not permit the Leverage Ratio as
of the last day of any Fiscal Quarter occurring during any period set forth
below to be greater than the ratio set forth opposite such period:
Period Leverage Ratio
------ --------------
Closing Date to 06/30/99 5.50:1
07/01/99 to 09/30/99 5.25:1
10/01/99 to 06/30/00 5.00:1
07/01/00 to 09/30/00 4.75:1
10/01/00 to 06/30/01 4.50:1
07/01/01 to 09/30/01 4.25:1
10/01/01 and thereafter 4.00:1
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(d) Minimum Net Worth. The Borrower will not permit Net Worth during
any period set forth below to be less than the amount determined pursuant
to the calculations set forth opposite such period:
Determination of
Period Minimum Net Worth
------ -----------------
07/01/99 to 09/30/99 Base Net Worth less
$25,000,000
10/01/99 to 12/31/99 Base Net Worth less
$33,000,000
01/01/00 to 03/31/00 Base Net Worth less
$41,000,000
04/01/00 to 12/31/01 Net Worth Amount
01/01/02 to 06/29/02 Net Worth Amount for the
period ending on 12/31/01
06/30/02 to 06/29/03 Net Worth Amount for the
period ending on 12/31/01
plus $10,000,000
06/30/03 to 06/29/04 Net Worth Amount for the
period ending on 12/31/01
plus $20,000,000
06/30/04 and thereafter Net Worth Amount for the
period ending on 12/31/01
plus $30,000,000
(e) Fixed Charge Coverage Ratio. The Borrower will not permit the
Fixed Charge Coverage Ratio as of the last day of any Fiscal Quarter
occurring during any period set forth below to be less than the ratio set
forth opposite such period:
Fixed Charge
Period Coverage Ratio
------ --------------
Closing Date to 09/30/99 1.00:1
10/01/99 to 03/31/00 1.10:1
04/01/00 to 09/30/00 1.20:1
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Fixed Charge
Period Coverage Ratio
------ --------------
10/01/00 to 03/31/01 1.30:1
04/01/01 and thereafter 1.40:1
SECTION 7.2.5. Investments. The Borrower will not, and will not permit any
of its Restricted Subsidiaries to Incur any Investment in any other Person,
except:
(a) Investments existing on the Closing Date and identified in Item
7.2.5(a) ("Ongoing Investments") of the Disclosure Schedule;
(b) Cash Equivalent Investments;
(c) without duplication, Investments permitted as Indebtedness
pursuant to Section 7.2.2;
(d) without duplication, Investments permitted as Capital Expenditures
pursuant to Section 7.2.7;
(e) Investments by the Borrower in any of its Restricted Subsidiaries,
or by any such Restricted Subsidiary in any other Restricted Subsidiary or
in the Borrower, by way of contributions to capital or purchases of equity;
(f) Investments constituting (i) accounts receivable arising, (ii)
trade debt granted, or (iii) deposits made in connection with the purchase
price of goods or services, in each case in the ordinary course of
business;
(g) Investments received in connection with the bankruptcy or
reorganization of, or settlement of delinquent accounts and disputes with,
customers and suppliers, in each case in the ordinary course of business;
(h) Investments consisting of any deferred portion of the sales price
received by the Borrower or any Restricted Subsidiary in connection with
any asset sale permitted under Section 7.2.9;
(i) Investments made in connection with the Transaction;
(j) Investments in Parent to the extent necessary to enable Parent to
pay (i) its overhead expenses in an amount not to exceed the amount set
forth in clause (b)(i) of Section 7.2.6 (which amount shall be reduced
dollar-for-dollar to the extent of any Restricted Payments made pursuant to
such clause (b)(i)) and (ii) Taxes;
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(k) Investments constituting Permitted Acquisitions in an aggregate
amount not to exceed $50,000,000 in any Fiscal Year; provided, that (i)
such Investments shall result in the acquisition of a wholly-owned
Restricted Subsidiary and (ii) upon making such Investments, the provisions
of Section 7.1.7 are complied with;
(l) other Investments made by the Borrower or any of its Restricted
Subsidiaries in an aggregate amount not to exceed $2,500,000 at any time
outstanding;
provided, however, that
(m) any Investment which when made complies with the requirements of
clause (a), (b) or (c) of the definition of the term "Cash Equivalent
Investment" may continue to be held for no more than 180 days following the
date that such Investment no longer meets the requirements of such
definition;
(n) no Investment otherwise permitted by clause (d), (e), or (j) shall
be permitted to be made if any Default has occurred and is continuing or
would result therefrom.
SECTION 7.2.6. Restricted Payments, etc. The Borrower will not, and will
not permit any of its Restricted Subsidiaries to, declare or make a Restricted
Payment (including the making of any Restricted Payment to Parent to pay the
principal or interest accrued on either the Seller Notes or the 399VP Notes), or
make any deposit for any Restricted Payment, other than
(a) Restricted Payments made by Restricted Subsidiaries to the
Borrower or wholly-owned Restricted Subsidiaries,
(b) Restricted Payments made to Parent to the extent necessary to
enable Parent to (i) pay its overhead expenses in an amount not to exceed
$2,000,000 in the aggregate in any Fiscal Year (which amount shall be
reduced dollar-for-dollar to the extent of any Investments made pursuant to
clause (j)(i) of Section 7.2.5), (ii) pay Taxes and (iii) so long as (A) no
Default shall have occurred and be continuing on the date such Restricted
Payment is declared or to be made, nor would a Default result from the
making of such Restricted Payment, (B) after giving effect to the making of
such Restricted Payment, the Borrower shall be in pro forma compliance with
the covenants set forth in Section 7.2.4 for the most recent full Fiscal
Quarter immediately preceding the date of the making of such Restricted
Payment for which the relevant financial information has been delivered
pursuant to clause (a) or clause (b) of Section 7.1.1, and (C) an
Authorized Officer of the Borrower shall have delivered a certificate to
the Administrative Agent in form and substance satisfactory to the
Administrative Agent (including a calculation of the Borrower's compliance
with the covenants set forth in Section 7.2.4 in reasonable detail)
certifying as to the accuracy of clauses (A) and (B) above, repurchase,
redeem or otherwise acquire or retire for value any Capital Stock of
Parent, or any warrant, option or other right to acquire Capital Stock of
Parent, held by any member of management of the Borrower or any of its
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Restricted Subsidiaries pursuant to any management equity subscription
agreement or stock option agreement; provided that the aggregate price paid
for all such repurchased, redeemed, acquired or retired Capital Stock,
warrants, options and other rights shall not exceed $1,000,000 over the
life of this Agreement.
SECTION 7.2.7. Capital Expenditures. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, make or commit to make Capital
Expenditures in any Fiscal Year, except (subject (in the case of Capitalized
Lease Liabilities) to clause (e) of Section 7.2.2) Capital Expenditures which do
not aggregate in excess of the amount set forth below opposite such Fiscal Year:
Capital
Fiscal Year Expenditure Amount
----------- ------------------
1999 $27,000,000
2000 $28,000,000
2001 $30,000,000
2002 $30,000,000
2003 $32,000,000
2004 $35,000,000;
provided, however, that, to the extent the amount of Capital Expenditures
permitted to be made in any Fiscal Year pursuant to this Section exceeds the
aggregate amount of Capital Expenditures actually made during such Fiscal Year,
such excess amount (up to an aggregate of 25% of the amount of Capital
Expenditures permitted for such Fiscal Year, without giving effect to this
proviso) may be carried forward to (but only to) the next succeeding Fiscal Year
(any such amount to be certified by the Borrower to the Agents in the Compliance
Certificate delivered for the last Fiscal Quarter of such Fiscal Year, and any
such amount carried forward to a succeeding Fiscal Year shall be deemed to be
used prior to the Borrower and its Restricted Subsidiaries using the amount of
Capital Expenditures permitted by this Section in such succeeding Fiscal Year,
without giving effect to such carry-forward).
SECTION 7.2.8. Consolidation, Merger, etc. The Borrower will not, and will
not permit any of its Restricted Subsidiaries to, liquidate or dissolve,
consolidate with, or merge into ("Combine" or a "Combination") or with, any
other Person, or purchase or otherwise acquire all or substantially all of the
assets of any Person (or of any division thereof) except
(a) any such Restricted Subsidiary may Combine into the Borrower or
any Restricted Subsidiary, and the assets or stock of any Restricted
Subsidiary may be purchased or otherwise acquired by the Borrower or any
other Restricted Subsidiary; provided, that notwithstanding the above, a
Restricted Subsidiary may only Combine with and into another Restricted
Subsidiary if, after giving effect to such Combination, the Borrower
continues to own (d)rectly or indirectly), and the Administrative Agent
continues to have pledged to it pursuant to a Pledge Agreement, a
percentage of the issued and outstanding shares of Capital Stock (on a
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fully diluted basis) of the Restricted Subsidiary surviving such
Combination that is equal to or in excess of the percentage of the issued
and outstanding shares of Capital Stock (on a fully diluted basis) of the
Restricted Subsidiary that does not survive such Combination that was
(immediately prior to the Combination) owned by the Borrower or pledged to
the Administrative Agent, pursuant to such documentation and opinions as
shall be necessary in the opinion of the Agents to create, perfect or
maintain the collateral position of the Administrative Agent and the
Secured Parties therein as contemplated by this Agreement; and
(b) so long as no Default has occurred and is continuing or would
occur after giving effect thereto, the Borrower or any of its Restricted
Subsidiaries may purchase all or substantially all of the assets of any
Person (or any division thereof) not then a Restricted Subsidiary, or
acquire such Person by Combination, if permitted (without duplication)
pursuant to Section 7.2.7 to be made as a Capital Expenditure or if
permitted (without duplication) pursuant to Section 7.2.5 to be made as an
Investment.
SECTION 7.2.9. Asset Dispositions, etc. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, Dispose of any of the Borrower's
or such Restricted Subsidiaries' assets (including accounts receivable and
Capital Stock of Subsidiaries) to any Person in one transaction or series of
transactions unless such Disposition is
(a) inventory Disposed of in the ordinary course of its business,
(b) permitted by Section 7.2.8,
(c) a transfer of the Fixed Assets of the Borrower and its Restricted
Subsidiaries or
(d) (i) for fair market value and the consideration consists of no
less than 80% in cash or Marketable Securities (provided, that such
percentage shall be reduced to 50% with respect to the Disposition of any
asset with a fair market value which is not in excess of $500,000), (ii)
the Net Disposition Proceeds received from such assets, together with the
Net Disposition Proceeds of all other assets Disposed pursuant to this
clause (d) since the Closing Date (other than with respect to Net
Disposition Proceeds reinvested pursuant to clause (d) of Section 3.1.1),
does not exceed (individually or in the aggregate) $2,000,000 over the term
of this Agreement and (iii) an amount equal to the Net Disposition Proceeds
generated from such Disposition are applied as Net Disposition Proceeds to
prepay the Loans or for reinvestment by the Borrower pursuant to the terms
of Section 3.1.1 and Section 3.1.2.
SECTION 7.2.10. Modification of Certain Agreements. The Borrower will not,
and will not permit any of its Restricted Subsidiaries or any Farmarkets
Subsidiary to, consent to any material amendment, supplement, waiver or other
modification of, or enter into any forbearance from exercising any material
rights with respect to the terms or provisions contained in (a) any of the First
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Mortgage Note Documents, except (i) in connection with any refinancing,
refunding, renewal or extension of the Indebtedness evidenced by the First
Mortgage Notes (which refinancing, refunding, renewal or extension shall be on
No Less Favorable Terms and Conditions) or (ii) as otherwise permitted pursuant
hereto (and on terms and conditions and pursuant to documentation reasonably
satisfactory to the Agents) or (b) any of the other Transaction Documents.
SECTION 7.2.11. Transactions with Affiliates. The Borrower will not, and
will not permit any of its Restricted Subsidiaries to, enter into or cause or
permit to exist any arrangement or contract (including for the purchase, lease
or exchange of property or the rendering of services) with any of its other
Affiliates, unless such arrangement or contract (a) is on fair and reasonable
terms not materially less favorable to the Borrower or such Restricted
Subsidiary than it could obtain in an arm's-length transaction with a Person
that is not an Affiliate and (b) is of the kind which would be entered into by a
prudent Person in the position of the Borrower or such Restricted Subsidiary
with a Person that is not one of its Affiliates.
SECTION 7.2.12. Negative Pledges, Restrictive Agreements, etc. The Borrower
will not, and will not permit any of its Restricted Subsidiaries (other than
pursuant to a Permitted Acquisition) to, enter into any agreement prohibiting
(a) (i) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired (other than in
the case of any assets acquired with the proceeds of any Indebtedness
permitted under clause (e) of Section 7.2.2 or subject to Capitalized Lease
Liabilities permitted under such clause (e), customary limitations and
prohibitions contained in such Indebtedness), or (ii) the ability of the
Borrower or any other Obligor to amend or otherwise modify this Agreement
or any other Loan Document; or
(b) any Restricted Subsidiary from making any payments, directly or
indirectly, to the Borrower by way of dividends, advances, repayments of
loans or advances, reimbursements of management and other intercompany
charges, expenses and accruals or other returns on investments, or any
other agreement or arrangement which restricts the ability of any such
Subsidiary to make any payment, directly or indirectly, to the Borrower.
SECTION 7.2.13. Sale and Leaseback. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly enter into
any agreement or arrangement with any other Person providing for the sale or
transfer by it of any property (now owned or hereafter acquired) having a fair
market value of more than $2,000,000 in the aggregate at any time outstanding
which has been or is to be sold or transferred by the Borrower or any of its
Restricted Subsidiaries to a Person and the subsequent lease or rental of such
property or other similar property from such Person.
SECTION 7.2.14. Stock of Subsidiaries. The Borrower will not, and will not
permit any of its Restricted Subsidiaries to, (a) issue any Capital Stock
(whether for value or otherwise) to any Person other than the Borrower or
another wholly-owned Restricted Subsidiary or (b) become liable in respect of
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any obligation (contingent or otherwise) to purchase, redeem, retire, acquire or
make any other payment in respect of any shares of Capital Stock of the Borrower
or any Restricted Subsidiary or any option, warrant or other right to acquire
any such shares of Capital Stock.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.1. Listing of Events of Default. Each of the following events or
occurrences described in this Section 8.1 shall constitute an "Event of
Default".
SECTION 8.1.1. Non-Payment of Obligations. (a) The Borrower shall default
in the payment or prepayment when due of any principal of any Loan, (b) the
Borrower shall default in the payment when due of any Reimbursement Obligation
or deposit of cash collateral for purposes pursuant to Section 2.6.4 or (c) the
Borrower or any other Obligor shall default (and such default shall continue
unremedied for a period of three Business Days) in the payment when due of any
interest or fee with respect to the Loans or Commitments or of any other
Obligation.
SECTION 8.1.2. Breach of Warranty. Any representation or warranty of any
Obligor made or deemed to be made in any Loan Document (including any
certificates delivered pursuant to Article V) is or shall be incorrect when made
or deemed to have been made in any material respect.
SECTION 8.1.3. Non-Performance of Certain Covenants and Obligations. The
Borrower shall default in the due performance and observance of any of its
obligations under Section 7.1.8 and Section 7.2.
SECTION 8.1.4. Non-Performance of Other Covenants and Obligations. The
Borrower or any other Obligor shall default in the due performance and
observance of any other agreement contained herein or in any other Loan Document
executed by it, and such default shall continue unremedied for a period of 30
days after notice thereof shall have been given to the Borrower by the
Administrative Agent or any Lender; provided, however, the Borrower shall not be
in default of clause (a) of Section 7.1.6 if the Borrower and its Subsidiaries
commence their response to such non-compliance within the period permitted by
such Environmental Laws.
SECTION 8.1.5. Default on Other Indebtedness. A default shall occur in the
payment when due (subject to any applicable grace period), whether by
acceleration or otherwise, of any Indebtedness (other than Indebtedness
described in Section 8.1.1) of the Borrower or any of its Subsidiaries or any
other Obligor having a principal amount, individually or in the aggregate, in
excess of $1,000,000, or a default shall occur in the performance or observance
of any obligation or condition with respect to such Indebtedness if the effect
of such default is to accelerate the maturity of any such Indebtedness or such
default shall continue unremedied for any applicable period of time sufficient
to permit the holder or holders of such Indebtedness, or any trustee or agent
for such holders, to cause or declare such Indebtedness to become due and
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payable or to require such Indebtedness to be prepaid, redeemed, purchased or
defeased, or require an offer to purchase or defease such Indebtedness to be
made, prior to its expressed maturity.
SECTION 8.1.6. Judgments. Any judgment or order for the payment of money in
excess of $1,000,000 (not covered by insurance from a responsible insurance
company that is not denying its liability with respect thereto) shall be
rendered against the Borrower or any of its Subsidiaries or any other Obligor
and such judgment or order remains undischarged, unbonded or unstayed for a
period of thirty (30) consecutive days from the date of entry thereof.
SECTION 8.1.7. Pension Plans. Any of the following events shall occur with
respect to any Pension Plan:
(a) the institution of any steps by the Borrower, any member of its
Controlled Group or any other Person to terminate a Pension Plan if, as a
result of such termination, the Borrower or any such member could be
required to make a contribution to such Pension Plan, or could reasonably
expect to incur a liability or obligation to such Pension Plan, in excess
of $1,000,000; or
(b) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under section 302(f) of ERISA.
SECTION 8.1.8. Change in Control. Any Change in Control shall occur.
SECTION 8.1.9. Bankruptcy, Insolvency, etc. The Borrower or any of its
Subsidiaries or any other Obligor shall
(a) become insolvent or generally fail to pay, or admit in writing its
inability or unwillingness generally to pay, debts as they become due;
(b) apply for, consent to, or acquiesce in, the appointment of a
trustee, receiver, sequestrator or other custodian for any substantial part
of the property of any thereof, or make a general assignment for the
benefit of creditors;
(c) in the absence of such application, consent or acquiescence,
permit or suffer to exist the appointment of a trustee, receiver,
sequestrator or other custodian for the Borrower or any of its Subsidiaries
or any other Obligor or for a substantial part of the property of any
thereof, and such trustee, receiver, sequestrator or other custodian shall
not be discharged within 60 days, provided that the Borrower, each
Subsidiary and each other Obligor hereby expressly authorizes the Agents,
the Issuer and each Lender to appear in any court conducting any relevant
proceeding during such 60-day period to preserve, protect and defend their
rights under the Loan Documents;
95
(d) permit or suffer to exist the commencement of any bankruptcy,
reorganization, debt arrangement or other case or proceeding under any
bankruptcy or insolvency law, or any dissolution, winding up or liquidation
proceeding, in respect of the Borrower or any of its Subsidiaries or any
other Obligor, and, if any such case or proceeding is not commenced by the
Borrower or such Subsidiary or such other Obligor, such case or proceeding
shall be consented to or acquiesced in by the Borrower or such Subsidiary
or such other Obligor or shall result in the entry of an order for relief
or shall remain for 60 days undismissed, provided that the Borrower, each
Subsidiary and each other Obligor hereby expressly authorizes the Agents,
the Issuer and each Lender to appear in any court conducting any such case
or proceeding during such 60-day period to preserve, protect and defend
their rights under the Loan Documents; or
(e) take any action authorizing, or in furtherance of, any of the
foregoing.
SECTION 8.1.10. Impairment of Security, etc. (a) Any Loan Document, or any
Lien granted thereunder, shall (except in accordance with its terms), in whole
or in part, terminate, cease to be effective or cease to be the legally valid,
binding and enforceable obligation of any Obligor party thereto; (b) the
Borrower, any other Obligor or any other party shall, directly or indirectly,
contest in any manner such effectiveness, validity, binding nature or
enforceability; or (c) any Lien securing any Obligation shall, in whole or in
part, cease to be a perfected first priority Lien, subject only, in each case,
to those exceptions expressly permitted by such Loan Document except to the
extent any event referred to above (i) relates to assets of the Borrower or any
of its Subsidiaries which are immaterial, (ii) results from the failure of the
Administrative Agent to maintain possession of certificates representing
securities pledged under any Pledge Agreement or to file continuation statements
under the UCC of any applicable jurisdiction or (iii) is covered by a lender's
title insurance policy and the relevant insurer promptly after the occurrence
thereof shall have acknowledged in writing that the same is covered by such
title insurance policy.
SECTION 8.2. Action if Bankruptcy. If any Event of Default described in
clauses (a) through (e) of Section 8.1.9 shall occur, the Commitments (if not
theretofore terminated) shall automatically terminate and the outstanding
principal amount of all outstanding Loans and all other Obligations (including
Reimbursement Obligations) shall automatically be and become immediately due and
payable, without notice or demand to any Person and the Borrower shall be
obligated to immediately Cash Collateralize all Letter of Credit Outstandings.
SECTION 8.3. Action if Other Event of Default. If any Event of Default
(other than an Event of Default described in clauses (a) through (e) of Section
8.1.9) shall occur for any reason, whether voluntary or involuntary, and be
continuing, the Administrative Agent, upon the direction of the Required
Lenders, shall by notice to the Borrower declare all or any portion of the
outstanding principal amount of the Loans and other Obligations (including
Reimbursement Obligations) to be due and payable, require the Borrower to Cash
Collateralize all Letter of Credit Outstandings and/or declare the Commitments
(if not theretofore terminated) to be terminated, whereupon the full unpaid
amount of such Loans and other Obligations which shall be so declared due and
payable shall be and become immediately due and payable, without further notice,
96
demand or presentment, and/or, as the case may be, the Commitments shall
terminate and the Borrower shall be obligated to immediately Cash Collateralize
all Letter of Credit Outstandings.
ARTICLE IX
THE AGENTS
SECTION 9.1. Actions. Each Lender hereby appoints DLJ as its Syndication
Agent, ▇▇▇▇▇▇ as its Documentation Agent and U.S. Bancorp as its Administrative
Agent under and for purposes of this Agreement and each other Loan Document.
Each Lender authorizes the Agents to act on behalf of such Lender under this
Agreement and each other Loan Document and, in the absence of other written
instructions from the Required Lenders received from time to time by the Agents
(with respect to which each of the Agents agrees that it will comply, except as
otherwise provided in this Section or as otherwise advised by counsel), to
exercise such powers hereunder and thereunder as are specifically delegated to
or required of the Agents by the terms hereof and thereof, together with such
powers as may be reasonably incidental thereto. The Agents may execute any of
their respective duties under this Agreement and each other Loan Document by or
through their respective employees, agents and attorneys-in-fact. Each Lender
hereby indemnifies (which indemnity shall survive any termination of this
Agreement) the Agents, pro rata according to such Lender's Percentage of the
then existing Revolving Loan Commitment Amount, from and against any and all
liabilities, obligations, losses, damages, claims, costs or expenses of any kind
or nature whatsoever which may at any time be imposed on, incurred by, or
asserted against, any of the Agents in any way relating to or arising out of
this Agreement and any other Loan Document, including reasonable attorneys'
fees, and as to which any Agent is not reimbursed by the Borrower or any other
Obligor (and without limiting the obligation of the Borrower or any other
Obligor to do so); provided, however, that no Lender shall be liable for the
payment of any portion of such liabilities, obligations, losses, damages,
claims, costs or expenses which are determined by a court of competent
jurisdiction in a final proceeding to have resulted solely from such Agent's
gross negligence or wilful misconduct. An Agent shall not be required to take
any action hereunder or under any other Loan Document, or to prosecute or defend
any suit in respect of this Agreement or any other Loan Document, unless it is
indemnified hereunder to its satisfaction. If any indemnity in favor of either
of the Agents shall be or become, in such Agent's determination, inadequate,
such Agent may call for additional indemnification from the Lenders and cease to
do the acts indemnified against hereunder until such additional indemnity is
given.
SECTION 9.2. Funding Reliance, etc. Unless the Administrative Agent shall
have been notified by telephone, confirmed in writing, by any Lender by 2:00
p.m., Denver, Colorado time, on the day prior to a Borrowing or Disbursement
with respect to a Letter of Credit pursuant to Section 2.6.2 that such Lender
will not make available the amount which would constitute its Percentage of such
Borrowing on the date specified therefor, the Administrative Agent may assume
that such Lender has made such amount available to the Administrative Agent and,
in reliance upon such assumption, make available to the Borrower a corresponding
amount. If and to the extent that such Lender shall not have made such amount
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available to the Administrative Agent, such Lender and the Borrower severally
agree to repay the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date the
Administrative Agent made such amount available to the Borrower to the date such
amount is repaid to the Administrative Agent, at the interest rate applicable at
the time to Loans comprising such Borrowing.
SECTION 9.3. Exculpation. None of the Agents or the Co-Lead Arrangers nor
any of their respective directors, officers, employees or agents shall be liable
to any Lender for any action taken or omitted to be taken by it under this
Agreement or any other Loan Document, or in connection herewith or therewith,
except for its own willful misconduct or gross negligence, nor responsible for
any recitals or warranties herein or therein, nor for the effectiveness,
enforceability, validity or due execution of this Agreement or any other Loan
Document, nor for the creation, perfection or priority of any Liens purported to
be created by any of the Loan Documents, or the validity, genuineness,
enforceability, existence, value or sufficiency of any collateral security, nor
to make any inquiry respecting the performance by the Borrower or any other
Obligor of its obligations hereunder or under any other Loan Document. None of
the Agents or the Co-Lead Arrangers nor any of their respective directors,
officers, employees or agents shall be responsible for or have any duty to
ascertain, inquire into or verify (a) any statement, warranty or representation
made in connection with any Loan Document or any Borrowing hereunder, (b) the
performance or observance of any of the covenants or agreements of any Obligor
under any Loan Document, including any agreement by an Obligor to furnish
information directly to each Lender, (c) the satisfaction of any condition
specified in Article V, except receipt of items required to be delivered solely
to the Agents, (d) the existence or possible existence of any Default or Event
of Default, or (e) the financial condition of the Borrower or any other Obligor.
Any such inquiry which may be made by an Agent or the Issuer shall not obligate
it to make any further inquiry or to take any action. The Agents and the Issuer
shall be entitled to rely upon advice of counsel concerning legal matters and
upon any notice, consent, certificate, statement or writing which the Agents or
the Issuer, as applicable, believe to be genuine and to have been presented by a
proper Person.
SECTION 9.4. Successor. Each of the Syndication Agent and the Documentation
Agent may resign as such upon one Business Day's notice to the Borrower and the
Administrative Agent. The Administrative Agent may resign as such at any time
upon at least 30 days' prior notice to the Borrower and all Lenders. The
Administrative Agent may be removed at any time with or without cause by written
notice received by such Agent from the Required Lenders, such removal to be
effective on the date specified in such notice. If the Administrative Agent at
any time shall resign or be removed, the Required Lenders may, with the prior
consent of the Borrower (which consent shall not be unreasonably withheld or
delayed), appoint another Lender as a successor Agent which shall thereupon
become the Administrative Agent hereunder. If no successor Agent shall have been
so appointed by the Required Lenders, and shall have accepted such appointment,
within 30 days after the retiring Agent's giving notice of resignation or
receiving notice of removal, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent, which shall be one of the Lenders or a
commercial banking institution organized under the laws of the U.S. (or any
State thereof) or a U.S. branch or agency of a commercial banking institution,
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and having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Agent shall be entitled to receive from the
retiring Agent such documents of transfer and assignment as such successor Agent
may reasonably request, and shall thereupon succeed to and become vested with
all rights, powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under this
Agreement. After any retiring Administrative Agent's resignation or removal
hereunder as such, the provisions of (a) this Article IX shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was such
Agent under this Agreement, and (b) Section 10.3 and Section 10.4 shall continue
to inure to its benefit. Notwithstanding anything else to the contrary in this
Section 9.4, the Administrative Agent may at any time, without the consent of
the Borrower or any Lender, appoint an Affiliate which is a commercial banking
institution as a successor Administrative Agent.
SECTION 9.5. Credit Extensions by Each Agent and Issuer. Each Agent and the
Issuer shall have the same rights and powers with respect to (a) in the case of
the Agents, the Credit Extensions made by it or any of its Affiliates and (b) in
the case of the Issuer, the Loans made by it or any of its Affiliates, as any
other Lender and may exercise the same as if it were not an Agent or the Issuer.
Each Agent, the Issuer and each of their respective Affiliates may accept
deposits from, lend money to, and generally engage in any kind of business with
the Borrower or any Subsidiary or Affiliate of the Borrower as if such Agent or
Issuer were not an Agent or Issuer hereunder.
SECTION 9.6. Credit Decisions. Each Lender acknowledges that it has,
independently of the Agents, the Co-Lead Arrangers, the Issuer and each other
Lender, and based on such Lender's review of the financial information of the
Borrower, this Agreement, the other Loan Documents (the terms and provisions of
which being satisfactory to such Lender) and such other documents, information
and investigations as such Lender has deemed appropriate, made its own credit
decision to extend its Commitments. Each Lender also acknowledges that it will,
independently of the Agents, the Co-Lead Arrangers, the Issuer and each other
Lender, and based on such other documents, information and investigations as it
shall deem appropriate at any time, continue to make its own credit decisions as
to exercising or not exercising from time to time any rights and privileges
available to it under this Agreement or any other Loan Document.
SECTION 9.7. Copies, etc. The Administrative Agent shall give prompt notice
to each Lender of each notice or request required or permitted to be given to
the Administrative Agent by the Borrower pursuant to the terms of this Agreement
(unless concurrently delivered to the Lenders by the Borrower). The
Administrative Agent will distribute to each Lender each document or instrument
received for its account and copies of all other communications received by the
Administrative Agent from the Borrower for distribution to the Lenders by the
Administrative Agent in accordance with the terms of this Agreement. The Agent
shall have no duty to disclose to the Lenders information that is not required
to be furnished by the Borrower to the Agents, but that may be voluntarily
furnished by the Borrower to the Agents either in their capacity as Agent or in
their individual capacity).
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SECTION 9.8. The Syndication Agent and the Documentation Agent.
Notwithstanding anything else to the contrary contained in this Agreement or any
other Loan Document, the Syndication Agent and the Documentation Agent, each in
such capacity, shall have no duties or responsibilities under this Agreement or
any other Loan Document nor any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or otherwise exist against the
Syndication Agent or the Documentation Agent, as applicable, in such capacity
except as are explicitly set forth herein or in the other Loan Documents.
SECTION 9.9. Notices of Default. Notwithstanding anything else to the
contrary contained in this Agreement or any other Loan Document, the
Administrative Agent shall not be deemed to have knowledge of the occurrence of
a Default (other than the non-payment of principal or of interest on any Loan or
any Reimbursement Obligation) unless the Administrative Agent has received
notice from a Lender or the Borrower specifying such Default and stating that
such notice is a "Notice of Default". In the event that the Administrative Agent
receives any Notice of Default, the Administrative Agent shall give prompt
notice thereof to the Lenders (and shall give each Lender prompt notice of each
such non-payment). The Administrative Agent shall take such action with respect
to a Default specified in any Notice of Default as shall be directed by the
Required Lenders; provided, that unless and until the Administrative Agent shall
have received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default as it shall deem advisable in the best interests of the Lenders.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Waivers, Amendments, etc. The provisions of this Agreement
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented to
in writing by the Borrower and each Obligor party thereto and the Required
Lenders; provided, however, that no such amendment, modification or waiver which
would:
(a) modify any requirement hereunder that any particular action be
taken by all the Lenders or by the Required Lenders shall be effective
unless consented to in writing by each Lender;
(b) modify this Section 10.1 or clause (a) of Section 10.10, change
the definition of "Required Lenders", increase any Commitment Amount or the
Percentage of any Lender, reduce any fees described in Article III, release
any Restricted Subsidiary from its obligations under the Subsidiary
Guaranty, release Parent from its obligations under the Parent Guaranty and
Pledge Agreement, or release all or substantially all of the collateral
security (except in each case as otherwise specifically provided in this
Agreement, the Subsidiary Guaranty or either Pledge and Security Agreement)
or extend the Revolving Loan Commitment Termination Date unless consented
to in writing by each Lender;
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(c) extend the due date for, or reduce the amount of, any scheduled
repayment or prepayment of principal of or interest on any Loan or any
Reimbursement Obligation (or reduce the principal amount of or rate of
interest on any Loan or any Reimbursement Obligation) unless consented to
in writing by each Lender or, in the case of a Reimbursement Obligation,
the Issuer owed, and those Lenders participating in, such Reimbursement
Obligation;
(d) increase the Stated Amount of any Letter of Credit unless
consented to by the Issuer of such Letter of Credit;
(e) affect adversely the interests, rights or obligations of any
Agent, the Issuer or the Co-Lead Arrangers (in its capacity as Agent,
Issuer or as Co-Lead Arranger), unless consented to in writing by such
Agent, the Issuer or the Co-Lead Arrangers, as the case may be; or
(f) change the definition of "Borrowing Base Amount", "Eligible
Account", "Eligible Rebate Receivable", "Eligible Inventory", "Eligible
Prepaid Inventory" or "Net Asset Value", in each case if the effect of such
change would be to require a Lender to make or participate in a Credit
Extension in an amount that is greater than such Lender would have had to
make or participate in immediately prior to such amendment, modification or
waiver unless consented to in writing by each Lender.
No failure or delay on the part of any Agent, the Issuer or any Lender in
exercising any power or right under this Agreement or any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Borrower or
any other Obligor in any case shall entitle it to any notice or demand in
similar or other circumstances. No waiver or approval by any Agent, the Issuer
or any Lender under this Agreement or any other Loan Document shall, except as
may be otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.
For purposes of this Section 10.1, the Syndication Agent, in coordination
with the Administrative Agent, shall have primary responsibility, together with
the Borrower, in the negotiation, preparation, and documentation relating to any
amendment, modification or waiver of this Agreement, any other Loan Document or
any other agreement or document related hereto or thereto contemplated pursuant
to this Section.
SECTION 10.2. Notices. All notices, requests and other communications
provided to any party hereto under this Agreement or any other Loan Document
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shall be in writing or by facsimile and addressed, delivered or transmitted to
such party at its address or facsimile number set forth on Schedule II hereto
or, in the case of a Lender which becomes a party hereto after the date hereof,
as set forth in the Lender Assignment Agreement pursuant to which such Lender
becomes a Lender hereunder or at such other address or facsimile number as may
be designated by such party in a notice to the other parties. Any notice, (a) if
mailed and properly addressed with postage prepaid or (b) if properly addressed
and sent by pre-paid courier service, shall be deemed given when received, or
(c) if transmitted by facsimile, shall be deemed given when transmitted (and
telephonic confirmation of receipt thereof has been received).
SECTION 10.3. Payment of Costs and Expenses. The Borrower agrees to pay on
demand all reasonable expenses of each Agent (including the reasonable fees and
out-of-pocket expenses of counsel to the Agents and of local or foreign counsel,
if any, who may be retained by counsel to the Agents) in connection with
(a) the syndication by the Syndication Agent, the Documentation Agent
and the Co-Lead Arrangers of the Loans, the negotiation, preparation,
execution and delivery of this Agreement and of each other Loan Document,
including schedules and exhibits, and any amendments, waivers, consents,
supplements or other modifications to this Agreement or any other Loan
Document as may from time to time hereafter be required, whether or not the
transactions contemplated hereby are consummated;
(b) the filing or refiling of the Pledge and Security Agreements
and/or any UCC financing statements relating thereto and all amendments,
supplements and modifications to any thereof and any and all other
documents or instruments of further assurance required to be filed or
refiled by the terms hereof or of any Pledge Agreement or any Security
Agreement; and
(c) the preparation and review of the form of any document or
instrument relevant to this Agreement or any other Loan Document.
The Borrower further agrees to pay, and to save the Agents and the Lenders
harmless from all liability for, any stamp or other similar taxes which may be
payable in connection with the execution or delivery of this Agreement, the
Borrowings hereunder, the issuance of the Notes, the issuance of the Letters of
Credit, or any other Loan Documents. The Borrower also agrees to reimburse each
Agent and each Lender upon demand for all reasonable out-of-pocket expenses
(including reasonable attorneys' fees and legal expenses) incurred by such Agent
or such Lender in connection with (i) the negotiation of any restructuring or
"work-out", whether or not consummated, of any Obligations and (ii) the
enforcement of any Obligations, which shall include any action or participation
in any bankruptcy proceeding.
SECTION 10.4. Indemnification. In consideration of the execution and
delivery of this Agreement by each Lender and the extension of the Commitment,
the Borrower indemnifies, exonerates and holds each Agent, the Co-Lead
Arrangers, the Issuer and each Lender and each of their respective partners,
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trustees, officers, directors, employees and agents (collectively, the
"Indemnified Parties") free and harmless from and against any and all actions,
causes of action, suits, losses, costs, liabilities and damages, and expenses
incurred in connection therewith (irrespective of whether any such Indemnified
Party is a party to the action for which indemnification hereunder is sought),
including reasonable attorneys' fees and disbursements (collectively, the
"Indemnified Liabilities"), incurred by the Indemnified Parties or any of them
as a result of, or arising out of, or relating to
(a) any transaction financed or to be financed in whole or in part,
directly or indirectly, with the proceeds of any Credit Extension;
(b) the entering into and performance of this Agreement and any other
Loan Document by any of the Indemnified Parties (including any action
brought by or on behalf of the Borrower as the result of any determination
by the Administrative Agent and the Required Lenders pursuant to Article V
not to make any Credit Extension hereunder but excluding any such action in
which a court of competent jurisdiction in a final non-appealable judgment
determined that such Lenders breached their obligations hereunder in
respect of such Credit Extension);
(c) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Borrower or any of its
Subsidiaries of all or any portion of the stock or assets of any Person,
whether or not such Agent, the Co-Lead Arrangers, the Issuer or such Lender
is party thereto;
(d) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to the
protection of the environment or the Release by the Borrower or any of its
Subsidiaries of any Hazardous Material; or
(e) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real
property owned or operated by the Borrower or any Subsidiary thereof of any
Hazardous Material (including any losses, liabilities, damages, injuries,
costs, expenses or claims asserted or arising under any Environmental Law),
regardless of whether caused by, or within the control of, the Borrower or
such Subsidiary,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the relevant Indemnified Party's gross
negligence or wilful misconduct. Each Obligor and its permitted successors and
assigns hereby waive, release and agree not to make any claim, or bring any cost
recovery action against, any Agent, the Co-Lead Arrangers, the Issuer or any
Lender under CERCLA or any state equivalent, or any similar law now existing or
hereafter enacted, except to the extent arising out of the gross negligence or
wilful misconduct of any Indemnified Party. It is expressly understood and
agreed that to the extent that any of such Persons is strictly liable under any
Environmental Laws, such Obligor's obligation to such Person under this
indemnity shall likewise be without regard to fault on the part of such Obligor,
to the extent permitted under applicable law, with respect to the violation or
condition which results in liability of such Person. If and to the extent that
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the foregoing undertaking may be unenforceable for any reason, such Obligor
hereby agrees to make the maximum contribution to the payment and satisfaction
of each of the Indemnified Liabilities which is permissible under applicable
law.
SECTION 10.5. Survival. The obligations of the Borrower under Sections 4.3,
4.4, 4.5, 4.6, 10.3 and 10.4 shall in each case survive any termination of this
Agreement, the payment in full of all Obligations, the termination of all
Commitments and any assignment from one Lender to another (in the case of
Sections 10.3 and 10.4). The representations and warranties made by the Borrower
and each other Obligor in this Agreement and in each other Loan Document shall
survive the execution and delivery of this Agreement and each such other Loan
Document.
SECTION 10.6. Severability. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall, as
to such provision and such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions of
this Agreement or such Loan Document or affecting the validity or enforceability
of such provision in any other jurisdiction.
SECTION 10.7. Headings. The various headings of this Agreement and of each
other Loan Document are inserted for convenience only and shall not affect the
meaning or interpretation of this Agreement or such other Loan Document or any
provisions hereof or thereof.
SECTION 10.8. Execution in Counterparts, Effectiveness, etc. This Agreement
may be executed by the parties hereto in several counterparts, each of which
shall be deemed to be an original (whether such counterpart is originally
executed or an electronic copy of an original) and all of which shall constitute
together but one and the same agreement. This Agreement shall become effective
when counterparts hereof executed on behalf of the Borrower and each Lender (or
notice thereof satisfactory to the Agents) shall have been received by the
Syndication Agent and notice thereof shall have been given by the Administrative
Agent or the Syndication Agent to the Borrower and each Lender.
SECTION 10.9. Governing Law; Entire Agreement. THIS AGREEMENT AND EACH
OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK, EXCLUDING THE LAW OF
CONFLICTS BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. This
Agreement and the other Loan Documents constitute the entire understanding among
the parties hereto with respect to the subject matter hereof and supersede any
prior agreements, written or oral, with respect thereto.
SECTION 10.10. Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that:
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(a) the Borrower may not assign or transfer its rights or obligations
hereunder without the prior written consent of the Administrative Agent and
all Lenders; and
(b) the rights of sale, assignment and transfer of the Lenders are
subject to Section 10.11.
SECTION 10.11. Sale and Transfer of Loans; Participations in Loans and
Notes. Each Lender may assign, or sell participations in, its Loans and
Commitments to one or more other Persons in accordance with this Section 10.11.
SECTION 10.11.1. Assignments. Any Lender (an "Assignor Lender"),
(a) with the written consents (whether by originally executed
counterpart or electronic copy thereof) of the Borrower and the Syndication
Agent, and notice to the Administrative Agent ((i) which consents shall not
be unreasonably delayed or withheld and (ii) which consents shall not be
required (but notice to the Borrower, the Administrative Agent and the
Syndication Agent shall be required) in the case of assignments made (A) to
the Agents or any of their Affiliates, (B) by the Agents or any of their
Affiliates to any commercial bank, any fund which is regularly engaged in
making, purchasing or investing in loans or securities or any other
financial institution the long-term certificate of deposit rating or
long-term senior unsecured debt rating of which as determined by S&P or
▇▇▇▇▇'▇ is at least BBB or Baa2 and (C) at any time when an Event of
Default shall have occurred and be continuing), may at any time assign and
delegate to one or more commercial banks, funds which are regularly engaged
in making, purchasing or investing in loans or securities or other
financial institutions, and
(b) with notice to the Borrower and the Agents, but without the
consent of the Borrower, the Agents or the Issuer, may assign and delegate
to any of its Affiliates or to any other Lender or to a Related Fund of any
Lender
(each such Person described in either of the foregoing clauses as being the
Person to whom such assignment and delegation is to be made, being hereinafter
referred to as an "Assignee Lender"), all or any fraction of such Lender's total
Loans, participations in Letters of Credit and Letter of Credit Outstandings
with respect thereto and Commitments (which assignment and delegation shall be,
as among Revolving Loan Commitments, Revolving Loans and participations in
Letters of Credit, of a constant, and not a varying, percentage) in a minimum
aggregate amount equal to the lesser of (i) $5,000,000 (if such assignment and
delegation is to a Person not then a Lender, an Affiliate of any Lender or a
Related Fund) or (ii) the then remaining amount of such Lender's Loans and
Commitments; provided, however, that any such Assignee Lender will comply, if
applicable, with the provisions contained in Section 4.6 and the Borrower, each
other Obligor and the Agents shall be entitled to continue to deal solely and
directly with such Lender in connection with the interests so assigned and
delegated to an Assignee Lender until (A) written notice of such assignment and
delegation, together with payment instructions, addresses and related
information with respect to such Assignee Lender, shall have been given to the
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Borrower and the Agents by such Lender and such Assignee Lender, (B) such
Assignee Lender shall have executed and delivered to the Borrower and the Agents
a Lender Assignment Agreement, accepted by the Agents, and (C) the processing
fees described below shall have been paid.
From and after the date that the Agents accept such Lender Assignment Agreement,
(i) the Assignee Lender thereunder shall be deemed automatically to have become
a party hereto and to the extent that rights and obligations hereunder have been
assigned and delegated to such Assignee Lender in connection with such Lender
Assignment Agreement, shall have the rights and obligations of a Lender
hereunder and under the other Loan Documents, and (ii) the Assignor Lender, to
the extent that rights and obligations hereunder have been assigned and
delegated by it in connection with such Lender Assignment Agreement, shall be
released from its obligations hereunder and under the other Loan Documents.
Within ten Business Days after its receipt of notice that the Administrative
Agent has received an executed Lender Assignment Agreement, the Borrower shall
execute and deliver to the Administrative Agent (for delivery to the relevant
Assignee Lender), and to the extent requested, new Notes evidencing such
Assignee Lender's assigned Loans and Commitments and, if the Assignor Lender has
retained Loans and Commitments hereunder, replacement Notes in the principal
amount of the Loans and Commitments retained by the Assignor Lender hereunder
(such Notes to be in exchange for, but not in payment of, those Notes then held
by such Assignor Lender). Each such Note shall be dated the date of the
predecessor Notes. The Assignor Lender shall ▇▇▇▇ the predecessor Notes
"exchanged" and deliver them to the Borrower. Accrued interest on that part of
the predecessor Notes evidenced by the new Notes, and accrued fees, shall be
paid as provided in the Lender Assignment Agreement. Accrued interest on that
part of the predecessor Notes evidenced by the replacement Notes shall be paid
to the Assignor Lender. Accrued interest and accrued fees shall be paid at the
same time or times provided in the predecessor Notes and in this Agreement. Such
Assignor Lender or such Assignee Lender must also pay a processing fee to the
Administrative Agent upon delivery of any Lender Assignment Agreement in the
amount of $3,500; provided, that no such processing fee shall be required in
connection with any such assignment and delegation (i) by a Lender to its
Affiliate or to a Related Fund, (ii) by a Lender to a Federal Reserve Bank (or,
if such Lender is an investment fund, to the trustee under the indenture to
which such fund is a party in support of its obligations to such trustee), (iii)
by DLJ and such assignment and delegation is in connection with the primary
syndication of the Loans or (iv) if the non-payment of the processing fee is
otherwise consented to by the Administrative Agent. Any attempted assignment and
delegation not made in accordance with this Section 10.11.1 shall be null and
void. Nothing contained in this Section 10.11.1 shall prevent or prohibit any
Lender from pledging its rights (but not its obligations to make Loans or
participate in Letters of Credit of Letter of Credit Outstandings) under this
Agreement and/or its Loans and/or its Notes hereunder (i) to a Federal Reserve
Bank in support of borrowings made by such Lender from such Federal Reserve Bank
or (ii) in the case of a Lender that is an investment fund, to the trustee under
the indenture to which such fund is a party in support of its obligations to
such trustee; provided, that any such assignment to a trustee shall be subject
to the provisions of clause (a) of this Section 10.11.1. In the event that S&P,
Moody's or ▇▇▇▇▇▇▇▇'▇ BankWatch (or InsuranceWatch Ratings Service, in the case
of Lenders that are insurance companies (or Best's Insurance Reports, if such
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insurance company is not rated by Insurance Watch Ratings Service)) shall, after
the date that any Lender with a Commitment to make Revolving Loans or
participate in Letters of Credit becomes a Lender, downgrade the long-term
certificate of deposit rating or long-term senior unsecured debt rating of such
Lender, and the resulting rating shall be below BBB-, Baa3 or C (or BB, in the
case of Lender that is an insurance company (or B, in the case of an insurance
company not rated by InsuranceWatch Ratings Service)), respectively, then the
Borrower (with the consent of the Administrative Agent and the Issuer) shall
have the right, but not the obligation, upon notice to such Lender and the
Agents, to replace such Lender with an Assignee Lender in accordance with and
subject to the restrictions contained in this Section, and such Lender hereby
agrees to transfer and assign without recourse (in accordance with and subject
to the restrictions contained in this Section) all its interests, rights and
obligations in respect of its Revolving Loan Commitment under this Agreement to
such Assignee Lender; provided, however, that (i) no such assignment shall
conflict with any law, rule and regulation or order of any Governmental
Authority and (ii) such Assignee Lender shall pay to such Lender in immediately
available funds on the date of such assignment the principal of and interest and
fees (if any) accrued to the date of payment on the Loans made, and Letters of
Credit participated in, by such Lender hereunder and all other amounts accrued
for such Lender's account or owed to it hereunder.
SECTION 10.11.2. Participations. Any Lender may at any time sell to one or
more commercial banks or other Persons (each such commercial bank and other
Person being herein called a "Participant") participating interests in any of
the Loans, Commitments, participations in Letters of Credit and Letter of Credit
Outstandings or other interests of such Lender hereunder; provided, however,
that
(a) no participation contemplated in this Section shall relieve such
Lender from its Commitments or its other obligations hereunder or under any
other Loan Document;
(b) such Lender shall remain solely responsible for the performance of
its Commitments and such other obligations;
(c) the Borrower and each other Obligor and the Agents shall continue
to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement and each of the other
Loan Documents;
(d) no Participant, unless such Participant is an Affiliate of such
Lender, or is itself a Lender, shall be entitled to require such Lender to
take or refrain from taking any action hereunder or under any other Loan
Document, except that such Lender may agree with any Participant that such
Lender will not, without such Participant's consent, agree to any reduction
in the interest rate or amount of fees that such Participant is otherwise
entitled to, a decrease in the principal amount, or an extension of the
final Stated Maturity Date, of any Loan in which such Participant has
purchased a participating interest or a release of all or substantially all
of the collateral security under the Loan Documents or any Restricted
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Subsidiary under the Subsidiary Guaranty, in each case except as otherwise
specifically provided in a Loan Document; and
(e) the Borrower shall not be required to pay any amount under
Sections 4.3, 4.4, 4.5, 4.6, 10.3 and 10.4 that is greater than the amount
which it would have been required to pay had no participating interest been
sold.
The Borrower acknowledges and agrees, subject to clause (e) above, that, to the
fullest extent permitted under applicable law, each Participant, for purposes of
Sections 4.3, 4.4, 4.5, 4.6, 4.8, 4.9, 10.3 and 10.4, shall be considered a
Lender.
SECTION 10.12. Confidentiality. The Lenders shall hold all non-public
information obtained pursuant to the requirements of this Agreement in
accordance with their customary procedures for handling confidential information
of this nature and in accordance with safe and sound banking practices and in
any event may make disclosure to any of their examiners, Affiliates, outside
auditors, counsel and other professional advisors in connection with this
Agreement or as reasonably required by any bona fide transferee, participant or
assignee or as required or requested by any governmental agency or
representative thereof or pursuant to legal process; provided, however, that
(a) unless specifically prohibited by applicable law or court order,
each Lender shall notify the Borrower of any request by any governmental
agency or representative thereof (other than any such request in connection
with an examination of the financial condition of such Lender by such
governmental agency) for disclosure of any such non-public information
prior to disclosure of such information;
(b) prior to any such disclosure pursuant to this Section 10.12, each
Lender shall require any such bona fide transferee, participant and
assignee receiving a disclosure of non-public information to agree in
writing
(i) to be bound by this Section 10.12; and
(ii) to require such Person to require any other Person to whom
such Person discloses such non-public information to be similarly
bound by this Section 10.12; and
(c) except as may be required by an order of a court of competent
jurisdiction and to the extent set forth therein, no Lender shall be
obligated or required to return any materials furnished by the Borrower or
any Subsidiary.
SECTION 10.13. Other Transactions. Nothing contained herein shall preclude
the Agents or any other Lender from engaging in any transaction, in addition to
those contemplated by this Agreement or any other Loan Document, with the
Borrower or any of its Affiliates in which the Borrower or such Affiliate is not
restricted hereby from engaging with any other Person.
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SECTION 10.14. Forum Selection and Consent to Jurisdiction. ANY LITIGATION
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY SECURED PARTY OR THE BORROWER IN
CONNECTION HEREWITH OR THEREWITH SHALL BE BROUGHT AND MAINTAINED EXCLUSIVELY IN
THE COURTS OF THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE
ADMINISTRATIVE AGENT'S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. THE BORROWER IRREVOCABLY CONSENTS TO
THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL
SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SET
FORTH ON SCHEDULE II HERETO. THE BORROWER HEREBY EXPRESSLY AND IRREVOCABLY
WAIVES ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF
VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE
EXTENT THAT THE BORROWER HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM
JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR
NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR
OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, THE BORROWER HEREBY
IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.
SECTION 10.15. Waiver of Jury Trial. EACH SECURED PARTY AND THE BORROWER
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR
ACTIONS OF ANY SUCH SECURED PARTY OR THE BORROWER IN CONNECTION HEREWITH OR
THEREWITH. THE BORROWER ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH
OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A
109
MATERIAL INDUCEMENT FOR EACH SECURED PARTY ENTERING INTO THIS AGREEMENT AND EACH
SUCH OTHER LOAN DOCUMENT.
110
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
▇▇▇▇▇▇▇-▇▇▇▇▇, INC.
By /s/ G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: President
DLJ CAPITAL FUNDING, INC.,
as the Syndication Agent and as Lender
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Managing Director
▇.▇. ▇▇▇▇▇▇ SECURITIES, INC.,
as Documentation Agent
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
U.S. BANCORP AG CREDIT, INC.,
as the Administrative Agent and as Lender
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
LENDERS:
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF
NEW YORK
By /s/ ▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Title: Managing Director
LASALLE BUSINESS CREDIT, INC.
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: First Vice President
COOPERATIVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A. "RABOBANK
NEDERLAND", NEW YORK BRANCH
By /s/ Michiel Van Der Voort
--------------------------------------
Name: Michiel Van Der Voort
Title: Vice President
By /s/ ▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇ ▇▇▇▇▇
Title: Senior Credit Officer
▇▇▇▇▇ FARGO BANK
By /s/ ▇▇▇▇▇ Chicoina
--------------------------------------
Name: ▇▇▇▇▇ Chicoina
Title: Vice President
▇▇▇▇▇▇ TRUST AND SAVINGS BANK
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
THE PROVIDENT BANK
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
NATIONSBANK, N.A.
By /s/ D. ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: D. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
MERCANTILE BANK NATIONAL ASSOCIATION
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
SCHEDULE I
to Credit Agreement
DISCLOSURE SCHEDULE TO CREDIT AGREEMENT
ITEM 2.1.2 Existing Letters of Credit
ITEM 6.7 Litigation.
ITEM 6.8 Existing Subsidiaries
ITEM 6.11 Employee Benefit Plans.
ITEM 6.12 Environmental Matters.
ITEM 7.2.2(b) Indebtedness to be Paid.
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
ITEM 7.2.2(c) Ongoing Indebtedness.
CREDITOR OUTSTANDING PRINCIPAL AMOUNT
ITEM 7.2.2(c) Ongoing Liens.
ITEM 7.2.5(a) Ongoing Investments.
SCHEDULE II
to Credit Agreement
ADMINISTRATIVE INFORMATION
--------------------------
Agents:
Notice Information
------------------
▇▇▇▇▇▇▇-▇▇▇▇▇, Inc. ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
DLJ Capital Funding, Inc.
as Syndication Agent ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Guaranty Trust
Company of New York ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
as Documentation Agent ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
U.S. Bancorp AG Credit, Inc.
as Administrative Agent ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇
Lenders:
Name of Lender Domestic Office LIBOR Office
-------------- --------------- ------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇ ▇▇▇▇▇
U.S. Bancorp ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇ 61 Wall Street
Inc. ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇
LaSalle Business Credit, ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Inc. Chicago, IL 60606 ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Mercantile Bank National 7th and Washington 7th and Washington
Association ▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Rabobank Nederland, New ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ Fargo Bank ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇ Street, Suite
200 200
Fresno, CA 93720 ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
NationsBank, N.A. ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
The Provident Bank One East Fourth Street, ▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ Trust and Savings ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank 18th Fl. ▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier: ▇▇▇-▇▇▇-▇▇▇▇ Telecopier: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇ ▇▇▇▇▇
LENDER PERCENTAGES
OF REVOLVING LOAN
LENDER ALLOCATION AMOUNT COMMITMENT PERCENTAGE
------ ----------------- ---------------------
DLJ Capital Funding, Inc. 25,000,000.00 9.0909%
▇.▇. ▇▇▇▇▇▇ Securities, Inc. 25,000,000.00 9.0909%
U.S. Bancorp AG Credit, Inc. 25,000,000.00 9.0909%
LaSalle Business Credit, Inc. 16,500,000.00 6.0000%
Mercantile Bank National Assc. 12,500,000.00 4.5455%
Rabobank Nederland NY Branch 24,000,000.00 8.7273%
▇▇▇▇▇ Fargo Bank 24,000,000.00 8.7273%
NationsBank, N.A. 24,000,000.00 8.7273%
The Provident Bank 12,500,000.00 4.5455%
▇▇▇▇▇▇ Trust and Savings Bank 24,000,000.00 8.7273%
SCHEDULE III
LOCATION OF INVENTORY
SCHEDULE IV
LIMITS ON BORROWING BASE AVAILABILITY
-------------------------------------
($ amounts in
millions)
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
--- --- --- --- --- --- --- --- ---- --- --- ---
Aggregate of $30 $30 $40 $50 $65 $65 $65 $60 $60 $60 $60 $50
Crop Term
Accounts and
Extended Term
Accounts on a
gross basis*
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
--- --- --- --- --- --- --- --- ---- --- --- ---
Rebate $3 $3 $3 $7 $10 $15 $20 $20 $20 $20 $20 $7
Receivables on
a margined
basis**
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
--- --- --- --- --- --- --- --- ---- --- --- ---
Prepaid $20 $20 $15 $10 $7 $5 $3 $3 $3 $3 $3 $5
Inventory on a
margined
basis**
* Before applying the relevant advance rate.
** After applying the relevant advance rate.