Exhibit 10.10
REVOLVING CREDIT AGREEMENT
dated as of May 16, 2000
among
VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC.,
ABN AMRO BANK N.V. and the other lending institutions set forth on Schedule 1
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attached hereto
and
ABN AMRO BANK N.V., as Agent
and
Fleet National Bank and Bank of America, N.A., as Documentation Agents
TABLE OF CONTENTS
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1. DEFINITIONS AND RULES OF INTERPRETATION 1
1.1. Definitions 1
1.2. Rules of Interpretation 21
2. THE REVOLVING CREDIT FACILITY 22
2.1. Commitment to Lend 22
2.1.1. The Revolving Credit A Loans 22
2.1.2. The Revolving Credit B Loans 22
2.2. Commitment Fee 23
2.2.1. The Revolving Credit A Loan Commitment Fee 23
2.2.2. The Revolving Credit B Loan Commitment Fee 23
2.3. Reduction of Commitments 24
2.3.1. Reduction of Total Revolver A Commitment 24
2.3.2. Reduction of Total Revolver B Commitment 24
2.4. The Notes 24
2.4.1. Revolving Credit A Notes 24
2.4.2. Revolving Credit B Notes 25
2.5. Interest on Revolving Credit Loans 25
2.6. Requests for Revolving Credit Loans 26
2.6.1. General 26
2.6.2. Swing Line 26
2.7. Conversion Options 27
2.7.1. Conversion to Different Type of Revolving Credit Loan 27
2.7.2. Continuation of Type of Revolving Credit Loan 27
2.7.3. LIBOR Rate Loans 27
2.8. Funds for Revolving Credit Loan 28
2.8.1. Funding Procedures 28
2.8.2. Advances by Agent 28
2.9. Settlements of Swing Line 29
2.9.1. General 29
2.9.2. Failure to Make Funds Available 29
2.9.3. No Effect on Other Banks 29
2.10. Change in Borrowing Base 29
3. REPAYMENT OF THE REVOLVING CREDIT LOANS 30
3.1. Maturity 30
3.1.1. Revolving Credit A Loans 30
3.1.2. Revolving Credit B Loans 30
3.2. Mandatory Repayment of Revolving Credit Loans 30
3.2.1. Revolving Credit A Loans 30
3.2.2. Revolving Credit B Loans 30
3.2.3. Revolving Credit Loans 30
3.3. Optional Repayments of Revolving Credit Loans 31
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4. LETTERS OF CREDIT 31
4.1. Letter of Credit Commitments 31
4.1.1. Commitment to Issue Letters of Credit 31
4.1.2. Letter of Credit Applications 31
4.1.3. Terms of Letters of Credit 32
4.1.4. Reimbursement Obligations of Banks 32
4.1.5. Participations of Banks 32
4.2. Reimbursement Obligation of the Borrower 32
4.3. Letter of Credit Payments 33
4.4. Obligations Absolute 34
4.5. Reliance by Issuer 34
4.6. Letter of Credit Fee 34
5. CERTAIN GENERAL PROVISIONS 35
5.1. Closing Fees 35
5.2. Agent's Fee 35
5.3. Funds for Payments 35
5.3.1. Payments to Agent 35
5.3.2. No Offset, etc. 35
5.3.3. Withholding Forms 36
5.3.4. Exclusions 36
5.4. Computations 36
5.5. Inability to Determine LIBOR Rate 37
5.6. Illegality 37
5.7. Additional Costs, etc. 37
5.8. Capital Adequacy 39
5.9. Certificate 39
5.10. Indemnity 39
5.11. Interest After Default 40
5.11.1. Overdue Amounts 40
5.11.2. Amounts Not Overdue 40
5.12. Replacement of Banks 40
5.13. Reserve Requirement 41
6. REPRESENTATIONS AND WARRANTIES 41
6.1. Corporate Authority 41
6.1.1. Incorporation; Good Standing 41
6.1.2. Authorization 41
6.1.3. Enforceability 42
6.2. Governmental Approvals 42
6.3. Title to Properties; Leases 42
6.4. Financial Statements, Projections and Solvency 42
6.4.1. Fiscal Year 42
6.4.2. Financial Statements 42
6.4.3. Projections 43
6.4.4. Solvency 43
6.5. No Material Changes, etc. 43
6.6. Franchises, Patents, Copyrights, etc. 43
6.7. Litigation 43
6.8. No Materially Adverse Contracts, etc. 44
6.9. Compliance with Other Instruments, Laws, etc. 44
6.10. Tax Status 44
6.11. No Event of Default 44
6.12. Holding Company and Investment Company Acts 44
6.13. Absence of Financing Statements, etc. 44
6.14. Insurance 44
6.15. Certain Transactions 45
6.16. Employee Benefit Plans 45
6.16.1. In General 45
6.16.2. Terminability of Welfare Plans 45
6.16.3. Guaranteed Pension Plans 45
6.16.4. Multiemployer Plans 46
6.17. Use of Proceeds 46
6.17.1. General 46
6.17.2. Regulations U and X 46
6.17.3. Ineligible Securities 46
6.18. Environmental Compliance 47
6.19. Subsidiaries, etc. 48
6.20. Chief Executive Office 48
6.21. Disclosure 48
6.22. Capitalization Documents 48
6.23. Status of Loan as Senior Debt 48
6.24. No Other Designated Senior Debt 49
7. AFFIRMATIVE COVENANTS OF THE BORROWER 49
7.1. Punctual Payment 49
7.2. Maintenance of Office 49
7.3. Records and Accounts 50
7.4. Financial Statements, Certificates and Information 50
7.5. Notices 51
7.5.1. Defaults 51
7.5.2. Environmental Events 52
7.5.3. Notice of Litigation and Judgments 52
7.6. Corporate Existence; Maintenance of Properties 52
7.7. Insurance 52
7.8. Taxes 53
7.9. Inspection of Properties and Books, etc. 53
7.9.1. General 53
7.9.2. Auditor Reports 53
7.9.3. Appraisals 53
7.10. Compliance with Laws, Contracts, Licenses, and Permits 54
7.11. Employee Benefit Plans 54
7.12. Use of Proceeds 54
7.13. Additional Subsidiaries 54
7.14. Subordinated Guarantees 55
7.15. Satisfaction of Examination 55
7.16. Further Assurances 55
8. CERTAIN NEGATIVE COVENANTS OF THE BORROWER 55
8.1. Restrictions on Indebtedness 55
8.2. Restrictions on Liens 57
8.3. Restrictions on Investments 58
8.4. Restricted Payments 59
8.5. Merger, Consolidation and Disposition of Assets 59
8.5.1. Mergers and Acquisitions 59
8.5.2. Disposition of Assets 60
8.6. Sale and Leaseback 60
8.7. Compliance with Environmental Laws 61
8.8. Employee Benefit Plans 61
8.9. Business Activities 61
8.10. Fiscal Year 61
8.11. Transactions with Affiliates 62
8.12. Upstream Limitations 62
8.13. Inconsistent Agreements 62
8.14. Modification of Documents and Charter Documents 62
8.15. Subordinated Debt 62
8.16. Senior Debt 62
9. FINANCIAL COVENANTS OF THE BORROWER 62
9.1. Leverage Ratio 63
9.2. Fixed Charge Coverage Ratio 63
9.3. Quick Ratio 63
9.4. Profitable Operations 63
9.5. Capital Expenditures 63
10. CLOSING CONDITIONS 63
10.1. Loan Documents 63
10.2. Certified Copies of Charter Documents 63
10.3. Corporate Action 63
10.4. Incumbency Certificate 64
10.5. UCC Search Results 64
10.6. Certificates of Insurance 64
10.7. Borrowing Base Report 64
10.8. Accounts Receivable Aging Report 64
10.9. Opinion of Counsel 64
10.10. Payment of Fees 64
11. CONDITIONS TO ALL BORROWINGS 64
11.1. Representations True; No Event of Default 65
11.2. No Legal Impediment 65
11.3. Governmental Regulation 65
11.4. Proceedings and Documents 65
11.5. Borrowing Base Report 65
12. EVENTS OF DEFAULT; ACCELERATION; ETC. 65
12.1. Events of Default and Acceleration 65
12.2. Termination of Commitments 69
12.3. Remedies 69
12.4. Distribution of Proceeds 69
13. SETOFF 69
14. THE AGENT 70
14.1. Authorization 71
14.2. Employees and Agents 71
14.3. No Liability 71
14.4. No Representations 72
14.4.1. General 72
14.4.2. Closing Documentation, etc. 72
14.5. Payments 72
14.5.1. Payments to Agent 73
14.5.2. Distribution by Agent 73
14.5.3. Delinquent Banks 73
14.6. Holders of Notes 74
14.7. Indemnity 74
14.8. Agent as Bank; Etc. 74
14.9. Resignation 74
14.10. Notification of Defaults and Events of Default 74
14.11. Action by Agent 75
15. EXPENSES AND INDEMNIFICATION 75
15.1. Expenses 75
15.2. Indemnification 76
15.3. Survival 76
16. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION 76
16.1. Confidentiality 76
16.2. Prior Notification 77
16.3. Other 77
17. SURVIVAL OF COVENANTS, ETC. 78
18. ASSIGNMENT AND PARTICIPATION 77
18.1. Conditions to Assignment by Banks 77
18.2. Certain Representations and Warranties; Limitations; Covenants 78
18.3. Register 79
18.4. New Notes 79
18.5. Participations 80
18.6. Disclosure 80
18.7. Assignee or Participant Affiliated with the Borrower 80
18.8. Miscellaneous Assignment Provisions 81
18.9. Assignment by Borrower 81
19. NOTICES, ETC. 81
20. GOVERNING LAW 82
21. HEADINGS 82
22. COUNTERPARTS 82
23. ENTIRE AGREEMENT, ETC. 83
24. WAIVER OF JURY TRIAL 83
25. CONSENTS, AMENDMENTS, WAIVERS, ETC. 83
26. SEVERABILITY 84
REVOLVING CREDIT AGREEMENT
--------------------------
This REVOLVING CREDIT AGREEMENT is made as of May 16, 2000, by and among
VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC. (the "Borrower"), a Delaware
corporation having its principal place of business at ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ABN AMRO BANK N.V. and the other lending institutions
listed on Schedule 1 and ABN AMRO BANK N.V. as agent for itself and such other
lending institutions.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. Definitions. The following terms shall have the meanings set forth
in this (S)1 or elsewhere in the provisions of this Credit Agreement referred to
below:
ABN AMRO. ABN AMRO Bank N.V., in its individual capacity.
Accounts Receivable. All rights of the Borrower or any of its Subsidiaries
to payment for goods sold, leased or otherwise marketed in the ordinary course
of business and all rights of the Borrower or any of its Subsidiaries to payment
for services rendered in the ordinary course of business and all sums of money
or other proceeds due thereon pursuant to transactions with account debtors,
recorded on books of account in accordance with Generally Accepted Accounting
Principles.
Adjustment Date. The first day of the month immediately following the
month in which a Compliance Certificate is to be delivered by the Borrower
pursuant to (S)7.4(c) hereof.
Affiliate. Any Person that would be considered to be an affiliate of the
Borrower under Rule 144(a) of the Rules and Regulations of the Securities and
Exchange Commission, as in effect on the date hereof, if the Borrower were
issuing securities.
Agent's Office. The Agent's head office located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, or at such other location as the Agent may designate
from time to time.
Agent. ABN AMRO Bank N.V., acting as agent for the Banks.
Agent's Special Counsel. ▇▇▇▇▇▇▇ ▇▇▇▇ LLP or such other counsel as may be
approved by the Agent.
Applicable Margin. For each period commencing on an Adjustment Date
through the date immediately preceding the next Adjustment Date (each a "Rate
Adjustment Period"), the Applicable Margin shall be the applicable margin set
forth below with respect to the Borrower's Fixed Charge Coverage Ratio as
determined for the period ending on the fiscal quarter ended immediately
preceding the applicable Rate Adjustment Period.
BASE RATE EUROCURRENCY COMMITMENT LETTER OF
LEVEL FIXED CHARGE COVERAGE RATIO LOANS RATE LOANS FEE RATE CREDIT RATE
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III Less than 1.50:1.00 0.75% 1.75% 0.500% 1.75%
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II Greater than or equal to 1.50:1.00 0.50% 1.50% 0.500% 1.50%
but less than 1.75:1.00
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I Greater than or equal to 1.75:1.00 0.25% 1.25% 0.375% 1.25%
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Notwithstanding the foregoing, (a) for Revolving Credit Loans outstanding,
Letter of Credit Rate and the Commitment Fee Rate payable during the period
commencing on the Closing Date through the date immediately preceding the first
Adjustment Date to occur after September 29, 2000, the Applicable Margin shall
not be less than Level II set forth above and (b) if the Borrower fails to
deliver any Compliance Certificate pursuant to (S)7.4(c) hereof then, for the
period commencing on the next Adjustment Date to occur subsequent to such
failure through the date immediately following the date on which such Compliance
Certificate is delivered, the Applicable Margin shall be the highest Applicable
Margin set forth above.
Assignment and Acceptance. See (S)18.1.
Balance Sheet Date. October 2, 1999.
Banks. ABN AMRO and the other lending institutions listed on Schedule 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to (S)18.
Base Rate. The higher of (a) the variable annual rate of interest so
designated from time to time by ABN AMRO at is head office in Chicago, Illinois
as is "prime commercial lending rate" or its "prime rate" (or an analogous
term), such rate being a reference rate and not necessarily representing the
lowest or best rate being charged to any customer, and (b) one-half of one
percent (1/2%) above the Federal Funds Effective Rate. For the purposes of this
definition, "Federal Funds Effective Rate" shall mean for any day, the rate per
annum equal to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, 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, if such rate is not so published for any day that is a Business Day, the
average of the quotations for such day on such transactions received by the
Agent from three funds brokers of recognized standing selected by the Agent.
Changes in the Base Rate resulting from any changes in ABN AMRO's "prime
commercial lending rate" or "prime rate" (or an analogous term) shall take place
immediately without notice or demand of any kind.
Base Rate Loans. Revolving Credit Loans bearing interest calculated by
reference to the Base Rate.
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Borrower. As defined in the preamble hereto.
Borrowing Base. At the relevant time of reference thereto, an amount
determined by the Agent by reference to the most recent Borrowing Base Report
delivered to the Banks and the Agent pursuant to (S)7.4(e), as adjusted pursuant
to the provisions below, which is equal to the sum of:
(a) 85% of Eligible Accounts Receivable that are not outstanding more
than ninety (90) days past the earlier to occur of (i) the date of the
respective invoices therefor and (ii) the date of shipment thereof in the
case of goods or the end of the calendar month following the provision
thereof in the case of services and for which invoices have been issued and
are (or, upon acceptance of the inventory, will be) payable; plus
(b) without duplication of those Eligible Accounts Receivable set
forth in paragraph (a) above, 40% of Eligible Accounts Receivable that are
not outstanding more than one hundred twenty (120) days (but more than
ninety days) past the earlier to occur of (i) the date of the respective
invoices therefor and (ii) the date of shipment thereof in the case of
goods or the end of the calendar month following the provision thereof in
the case of services and for which invoices have been issued and are (or,
upon acceptance of the inventory, will be) payable; plus
(c) without duplication of those Eligible Accounts Receivable set
forth in paragraphs (a) and (b) above, 20% of Eligible Accounts Receivable
that are not outstanding more than one hundred eighty (180) days (but more
than 120 days) past the earlier to occur of (i) the date of the respective
invoices therefor and (ii) the date of shipment thereof in the case of
goods or the end of the calendar month following the provision thereof in
the case of services and for which invoices have been issued and are (or,
upon acceptance of the inventory, will be) payable; plus
(d) 50% of the Net Book Value of Eligible Inventory; less
(e) the aggregate outstanding amount of all Investments made by the
Borrower in any Subsidiary pursuant to (S)8.3(g) of this Credit Agreement;
plus
(f) the Discretionary Amount
The Agent may, at the direction of the Majority Banks or in its discretion, from
time to time, upon five (5) days' prior notice to the Borrower, reduce advance
rates set forth herein if, in the Majority Banks' or the Agent's reasonable
discretion, the results of commercial finance examinations or similar
examinations or audits indicate a material deterioration in the Borrower's or
its Subsidiaries' Eligible Accounts Receivables or Eligible Inventory from the
Closing Date such that a lower advance rate for Eligible Accounts Receivables
and/or Eligible Inventory is warranted.
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For purposes of determining the Borrowing Base, each Eligible Account
Receivable which is denominated in a currency other than Dollars shall be
converted to Dollars at the actual rate of exchange (as quoted in The Wall
Street Journal or if not so quoted in The Wall Street Journal, as quoted in a
similar publication acceptable to the Agent) in effect on the date of the
Borrowing Base Report which reflects such Eligible Account Receivable.
Borrowing Base Report. A Borrowing Base Report signed by the chief
financial officer or chief accounting officer of the Borrower and in
substantially the form of Exhibit A hereto.
Business Day. Any day other than a Saturday or Sunday on which banking
institutions in Chicago, Illinois, are open for the transaction of banking
business and, in the case of LIBOR Rate Loans, also a day which is a LIBOR
Business Day.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); provided that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with Generally Accepted
Accounting Principles.
Capital Expenditures. Amounts paid or Indebtedness incurred by the
Borrower or any of its Subsidiaries in connection with (a) the purchase or lease
by the Borrower or any of its Subsidiaries of Capital Assets that would be
required to be capitalized and shown on the balance sheet of such Person in
accordance with Generally Accepted Accounting Principles or (b) the lease of any
assets by the Borrower or any of its Subsidiaries as lessee under any Synthetic
Lease to the extent that such assets would have been Capital Assets had the
Synthetic Lease been treated for accounting purposes as a Capitalized Lease.
Capitalization Documents. Collectively, the formation documents (including
without limitation any certificate of incorporation and by-laws) of the Borrower
and its Subsidiaries.
Capitalized Leases. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment
obligations under which are required to be capitalized on the balance sheet of
the lessee or obligor in accordance with Generally Accepted Accounting
Principles.
Cash Equivalents. As to the Borrower and its Subsidiaries, all items of
the Borrower and its Subsidiaries which would properly be classified as cash
equivalents in accordance with Generally Accepted Accounting Principles, plus,
without duplication, the Investments of the Borrower and its Subsidiaries made
in accordance with the Borrower's Investment Policy Guidelines.
CERCLA. See (S)6.18(a).
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Closing Date. The first date on which the conditions set forth in (S)10
have been satisfied and any Revolving Credit Loans are to be made or any Letter
of Credit is to be issued hereunder.
Code. The Internal Revenue Code of 1986.
Commitment Fee Rate. As referred to as such in the table contained in the
definition of "Applicable Margin".
Commitments. Collectively, the Revolver A Commitments and the Revolver B
Commitments.
Compliance Certificate. See (S)7.4(c) hereof.
Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with Generally Accepted Accounting
Principles.
Consolidated Current Assets. All cash, Cash Equivalents and Accounts
Receivable of the Borrower and its Subsidiaries on a consolidated basis that, in
accordance with Generally Accepted Accounting Principles, are properly
classified as current assets, provided that Accounts Receivable shall be
included only if good and collectible as determined by the Borrower in
accordance with established practice consistently applied and only if payable
and outstanding not more than one hundred eighty (180) days after the date of
the shipment of goods or other transaction out of which any such account
receivable arose; and such Accounts Receivable shall be taken at their face
value less reserves determined to be sufficient in accordance with Generally
Accepted Accounting Principles.
Consolidated Current Liabilities. All liabilities of the Borrower and its
Subsidiaries on a consolidated basis as may properly be classified as current
liabilities in accordance with Generally Accepted Accounting Principles.
Consolidated Net Income (or Deficit). The consolidated net income (or
deficit) of the Borrower and its Subsidiaries, after deduction of all expenses,
taxes, and other proper charges, determined in accordance with Generally
Accepted Accounting Principles.
Consolidated Net Operating Income (or Deficit). For any period, an amount
equal to (a) EBITDA for such period, plus, (b) for purposes of calculating
compliance with (S)9.4, to the extent deducted in the calculation of EBITDA, an
amount equal to the expense attributed to the Borrower's research and
development for such period in an amount not to exceed $10,000,000 for any
fiscal quarter, less (c) amortization and depreciation for such period.
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Consolidated Operating Cash Flow. For any period, an amount equal to (a)
EBITDA of the Borrower and its Subsidiaries for the fiscal quarter ending on
such date, less (b) the sum of (i) cash payments for all taxes paid during such
period, plus (ii) to the extent not already deducted in the calculation of
EBITDA, Capital Expenditures made during such period.
Consolidated Tangible Net Worth. As to the Borrower and its Subsidiaries
as of any date of determination, the equity capital of the Borrower and its
Subsidiaries as of such date as determined in accordance with Generally Accepted
Accounting Principles, less the total book value of all assets of the Borrower
and its Subsidiaries as of such date properly classified as intangible assets
under Generally Accepted Accounting Principles.
Consolidated Total Debt Service. For any fiscal period with respect to the
Borrower and its Subsidiaries, the sum of (a) Consolidated Total Interest
Expense for such period, plus (b) any and all mandatory or required payments of
principal in respect of Indebtedness of the Borrower and its Subsidiaries made
or required to be made in such period and which would be considered a current
liability in such period in accordance with Generally Accepted Accounting
Principles. Demand obligations shall be deemed to be due and payable during any
fiscal period during which such obligations are outstanding.
Consolidated Total Interest Expense. For any period, the aggregate amount
of interest required to be paid or accrued by the Borrower and its Subsidiaries
during such period on all Indebtedness of the Borrower and its Subsidiaries
outstanding during all or any part of such period, whether such interest was or
is required to be reflected as an item of expense or capitalized, including
payments consisting of interest in respect of any Capitalized Lease, or any
Synthetic Lease, and including commitment fees, agency fees, facility fees,
balance deficiency fees and similar fees or expenses in connection with the
borrowing of money.
Conversion Request. A notice given by the Borrower to the Agent of the
Borrower's election to convert or continue a Revolving Credit Loan in accordance
with (S)2.7.
Credit Agreement. This Revolving Credit Agreement, including the Schedules
and Exhibits hereto.
Default. See (S)12.1.
Delinquent Bank. See (S)14.5.3.
Deminimis Subsidiary. Any Subsidiary (a) the consolidated revenues of
which for the most recent period of four fiscal quarters for which financial
statements have been delivered pursuant to (S)7.4 were not greater than 5% of
the Borrower's consolidated revenues for such period or (b) the consolidated
assets of which as of the end of such period were not greater than 5% of the
Borrower's consolidated assets as of the end of such period.
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Discretionary Amount. As at any date of determination, an amount
determined by the Agent in its sole and absolute discretion which shall not
exceed $5,000,000 at any time and which amount shall not be more than $0.00 for
more than any period of ten (10) consecutive days.
Distribution. The declaration or payment of any dividend on or in respect
of any shares of any class of capital stock of the Borrower, other than
dividends payable solely in shares of common stock of the Borrower; the
purchase, redemption, or other retirement of any shares of any class of capital
stock of the Borrower, directly or indirectly through a Subsidiary of the
Borrower or otherwise; the return of capital by the Borrower to its shareholders
as such; or any other distribution on or in respect of any shares of any class
of capital stock of the Borrower.
Dollars or $. Dollars in lawful currency of the United States of America.
Domestic Lending Office. Initially, the office of each Bank designated as
such in Schedule 1 hereto; thereafter, such other office of such Bank, if any,
located within the United States that will be making or maintaining Base Rate
Loans.
Drawdown Date. The date on which any Revolving Credit Loan is made or is
to be made, and the date on which any Revolving Credit Loan is converted or
continued in accordance with (S)2.7.
EBITDA. With respect to the Borrower and its Subsidiaries for any fiscal
period, an amount equal to the sum of (a) Consolidated Net Income of the
Borrower and its Subsidiaries for such fiscal period, plus, (b) in each case to
the extent deducted in the calculation of Consolidated Net Income and without
duplication, (i) depreciation and amortization for such period, (ii) income tax
expense for such period, (iii) Consolidated Total Interest Expense paid or
accrued for such period, and (iv) other noncash charges for such period, and
minus, to the extent added in computing Consolidated Net Income, and without
duplication, all noncash gains (including income tax benefits) for such period,
all as determined in accordance with Generally Accepted Accounting Principles.
Eligible Accounts Receivable. Collectively, (1) the aggregate of the
unpaid portions of Accounts Receivable of the Borrower and its Subsidiaries
other than Varian BV, Varian Japan and Varian Japan Holdings as determined in
accordance with Generally Accepted Accounting Principles (net of any credits,
rebates, offsets, holdbacks or other adjustments or commissions payable to third
parties that are adjustments to such Accounts Receivable) (a) that the Borrower
reasonably and in good faith determines to be collectible; (b) that are with
account debtors or other obligors that (i) are not Affiliates of the Borrower,
(ii) purchased the goods or services giving rise to the relevant Account
Receivable in an arm's length transaction, (iii) are not insolvent or involved
in any case or proceeding, whether voluntary or involuntary, under any
bankruptcy, reorganization, arrangement, insolvency, adjustment of debt,
dissolution, liquidation or similar law of any jurisdiction and (iv) are, in the
Agent's reasonable judgment, creditworthy; (c) that are in payment of
obligations that have been fully performed, do not consist of progress ▇▇▇▇▇▇▇▇
or ▇▇▇▇ and hold invoices and are not
7
subject to dispute or any other similar claims that would reduce the cash amount
payable therefor; (d) that are not subject to any pledge, restriction, security
interest or other lien or encumbrance; (e) that are not outstanding for more
than one hundred eighty (180) days past the earlier to occur of (i) the date of
the respective invoices therefor and (ii) the date of shipment thereof in the
case of goods or the end of the calendar month following the provision thereof
in the case of services; (f) that are not due from any single account debtor or
other obligor if more than twenty five percent (25%) of the aggregate amount of
all Accounts Receivable owing from such account debtor or other obligor would
otherwise not be Eligible Accounts Receivable; (g) that are payable in Dollars,
Yen, Euros and other currencies acceptable to the Agent; and (h) that are
payable from an office inside of the United States, or any country which is a
member of the OECD or any other jurisdiction acceptable to the Agent and the
Banks; and (2) fifty percent (50%) of the aggregate of the unpaid portions of
Accounts Receivable of Varian BV, Varian Japan and Varian Japan Holdings as
determined in accordance with Generally Accepted Accounting Principles (net of
any credits, rebates, offsets, holdbacks or other adjustments or commissions
payable to third parties that are adjustments to such Accounts Receivable) (a)
that the Borrower reasonably and in good faith determines to be collectible; (b)
that are with account debtors or other obligors that (i) are not Affiliates of
the Borrower, Varian BV, Varian Japan or Varian Japan Holdings, (ii) purchased
the goods or services giving rise to the relevant Account Receivable in an arm's
length transaction, (iii) are not insolvent or involved in any case or
proceeding, whether voluntary or involuntary, under any bankruptcy,
reorganization, arrangement, insolvency, adjustment of debt, dissolution,
liquidation or similar law of any jurisdiction and (iv) are, in the Agent's
reasonable judgment, creditworthy; (c) that are in payment of obligations that
have been fully performed, do not consist of progress ▇▇▇▇▇▇▇▇ or ▇▇▇▇ and hold
invoices and are not subject to dispute or any other similar claims that would
reduce the cash amount payable therefor; (d) that are not subject to any pledge,
restriction, security interest or other lien or encumbrance; (e) that are not
outstanding for more than one hundred eighty (180) days past the earlier to
occur of (i) the date of the respective invoices therefor and (ii) the date of
shipment thereof in the case of goods or the end of the calendar month following
the provision thereof in the case of services; (f) that are not due from any
single account debtor or other obligor if more than twenty five percent (25%) of
the aggregate amount of all Accounts Receivable owing from such account debtor
or other obligor would otherwise not be Eligible Accounts Receivable; (g) that
are payable in Dollars, Yen, Euros and other currencies acceptable to the Agent;
and (h) that are payable from an office inside of the United States, or any
country which is a member of the OECD or any other jurisdiction acceptable to
the Agent and the Banks.
Eligible Assignee. Any of (a) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having total assets in excess of $1,000,000,000; (b) a
savings and loan association or savings bank organized under the laws of the
United States, or any State thereof or the District of Columbia, and having a
net worth of at least $100,000,000, calculated in accordance with Generally
Accepted Accounting Principles; (c) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of
8
any such country, and having total assets in excess of $1,000,000,000, provided
that such bank is acting through a branch or agency located in the country in
which it is organized or another country which is also a member of the OECD; (d)
the central bank of any country which is a member of the OECD; and (e) if, but
only if, any Event of Default has occurred and is continuing, any other bank,
insurance company, commercial finance company or other financial institution or
other Person approved by the Agent, such approval not to be unreasonably
withheld.
Eligible Inventory. With respect to the Borrower or any of its
Subsidiaries, finished goods, work in progress and raw materials and component
parts inventory owned by the Borrower or its Subsidiaries; provided that
Eligible Inventory shall not include any inventory (a) held on consignment, or
not otherwise owned by the Borrower or such Subsidiary, or of a type no longer
sold by the Borrower or such Subsidiary, (b) which has been returned by a
customer or is damaged or subject to any legal encumbrance other than Permitted
Liens, (c) which is not in the possession of the Borrower or such Subsidiary
unless the Agent has received a waiver from the party in possession of such
inventory in form and substance satisfactory to the Agent (provided, however, no
such waivers shall be required to be delivered under until June 30, 2000), (d)
which is held by the Borrower or such Subsidiary on property leased by the
Borrower or a Subsidiary, unless the Agent has received a waiver from the lessor
of such leased property and, if any, sublessor thereof in form and substance
satisfactory to the Agent (provided, however, no such waivers shall be required
to be delivered under until June 30, 2000), (e) which has been shipped to a
customer of the Borrower or such Subsidiary regardless of whether such shipment
is on a consignment basis, (f) which is not located within the United States of
America, any country which is a member of the OECD or any other jurisdiction
approved by the Agent in writing or (g) which the Agent reasonably deems to be
obsolete or not marketable.
Employee Benefit Plan. Any employee benefit plan within the meaning of
(S)3(3) of ERISA maintained or contributed to by the Borrower or any ERISA
Affiliate, other than a Guaranteed Pension Plan or a Multiemployer Plan.
Environmental Laws. See (S)6.18(a).
EPA. See (S)6.18(b).
ERISA. The Employee Retirement Income Security Act of 1974.
ERISA Affiliate. Any Person which is treated as a single employer with the
Borrower under (S)414 of the Code.
ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of (S)4043 of ERISA and the regulations
promulgated thereunder.
9
Eurocurrency Reserve Rate. For any day with respect to a LIBOR Rate Loan,
the maximum rate (expressed as a decimal) at which any lender subject thereto
would be required to maintain reserves under Regulation D of the Board of
Governors of the Federal Reserve System (or any successor or similar regulations
relating to such reserve requirements) against "Eurocurrency Liabilities" (as
that term is used in Regulation D), if such liabilities were outstanding. The
Eurocurrency Reserve Rate shall be adjusted automatically on and as of the
effective date of any change in the Eurocurrency Reserve Rate.
Event of Default. See (S)12.1.
Fee Letter. The fee letter dated prior to the Closing Date between the
Borrower and the Agent.
Fixed Charge Coverage Ratio. As at any date of determination, the ratio of
(a) Consolidated Operating Cash Flow of the Borrower and its Subsidiaries for
the fiscal quarter most recently ended to (b) Consolidated Total Debt Service of
the Borrower and its Subsidiaries for the fiscal quarter most recently ended.
Generally Accepted Accounting Principles. (a) When used in (S)9, whether
directly or indirectly through reference to a capitalized term used therein,
means (i) principles that are consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, in
effect for the fiscal year ended on the Balance Sheet Date, and (ii) to the
extent consistent with such principles, the accounting practice of the Borrower
reflected in its financial statements for the year ended on the Balance Sheet
Date, and (b) when used in general, other than as provided above, means
principles that are (i) consistent with the principles promulgated or adopted by
the Financial Accounting Standards Board and its predecessors, as in effect from
time to time, and (ii) consistently applied with past financial statements of
the Borrower adopting the same principles, provided that in each case referred
to in this definition of "Generally Accepted Accounting Principles" a certified
public accountant would, insofar as the use of such accounting principles is
pertinent, be in a position to deliver an unqualified opinion (other than a
qualification regarding changes in Generally Accepted Accounting Principles) as
to financial statements in which such principles have been properly applied.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of (S)3(2) of ERISA maintained or contributed to by the Borrower or any
ERISA Affiliate the benefits of which are guaranteed on termination in full or
in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer
Plan.
Hazardous Substances. See (S)6.18(b).
Indebtedness. As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:
(a) every obligation of such Person for money borrowed,
10
(b) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in
connection with the acquisition of property, assets or businesses,
(c) every reimbursement obligation of such Person with respect to
letters of credit, bankers' acceptances or similar facilities issued for
the account of such Person,
(d) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (including securities repurchase
agreements but excluding trade accounts payable or accrued liabilities
arising in the ordinary course of business),
(e) every obligation of such Person under any Capitalized Lease,
(f) every obligation of such Person under any lease (a "Synthetic
Lease") treated as an operating lease under Generally Accepted Accounting
Principles and as a loan or financing for U.S. income tax purposes,
(g) all sales by such Person of (i) accounts or general intangibles
for money due or to become due, (ii) chattel paper, instruments or
documents creating or evidencing a right to payment of money or (iii) other
receivables (collectively "receivables"), whether pursuant to a purchase
facility or otherwise, other than in connection with the disposition of the
business operations of such Person relating thereto or a disposition of
defaulted receivables for collection and not as a financing arrangement,
and together with any obligation of such Person to pay any discount,
interest, fees, indemnities, penalties, recourse, expenses or other amounts
in connection therewith,
(h) every obligation of such Person (an "equity related purchase
obligation") to purchase, redeem, retire or otherwise acquire for value any
shares of capital stock of any class issued by such Person, any warrants,
options or other rights to acquire any such shares, or any rights measured
by the value of such shares, warrants, options or other rights,
(i) every obligation of such Person under any forward contract,
futures contract, swap, option or other financing agreement or arrangement
(including, without limitation, caps, floors, collars and similar
agreements) which are not entered into the ordinary course of business, the
value of which is dependent upon interest rates, currency exchange rates,
commodities or other indices (a "derivative contract"),
(j) every obligation in respect of Indebtedness of any other entity
(including any partnership in which such Person is a general partner) to
the extent that such Person is liable therefor as a result of such Person's
ownership interest in or other relationship with such entity, except to the
extent that the terms of such Indebtedness provide that such Person is not
liable therefor and such terms are enforceable under applicable law,
11
(k) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guarantying or otherwise
acting as surety for, any obligation of a type described in any of clauses
(a) through (j) (the "primary obligation") of another Person (the "primary
obligor"), in any manner, whether directly or indirectly, and including,
without limitation, any obligation of such Person (A) to purchase or pay
(or advance or supply funds for the purchase of) any security for the
payment of such primary obligation, (B) to purchase property, securities or
services for the purpose of assuring the payment of such primary
obligation, or (C) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such primary obligation.
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (u) any Indebtedness, issued at a price that is
less than the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with Generally Accepted
Accounting Principles, (v) any Capitalized Lease shall be the principal
component of the aggregate of the rentals obligation under such Capitalized
Lease payable over the term thereof that is not subject to termination by the
lessee, (w) any sale of receivables shall be the amount of unrecovered capital
or principal investment of the purchaser (other than the Borrower or any of its
wholly-owned Subsidiaries) thereof, excluding amounts representative of yield or
interest earned on such investment, (x) any Synthetic Lease shall be the
stipulated loss value, termination value or other equivalent amount, (y) any
derivative contract shall be the maximum amount of any termination or loss
payment required to be paid by such Person if such derivative contract were, at
the time of determination, to be terminated by reason of any event of default or
early termination event thereunder, whether or not such event of default or
early termination event has in fact occurred and (z) any equity related purchase
obligation shall be the maximum fixed redemption or purchase price thereof
inclusive of any accrued and unpaid dividends to be comprised in such redemption
or purchase price.
Ineligible Securities. Securities which may not be underwritten or dealt
in by member banks of the Federal Reserve System under Section 16 of the Banking
Act of 1933 (12 U.S.C. (S)24, Seventh), as amended.
Interest Payment Date. (a) As to any Base Rate Loan, the last day of the
calendar month with respect to interest accrued during such calendar month,
including, without limitation, the calendar month which includes the Drawdown
Date of such Base Rate Loan; and (b) as to any LIBOR Rate Loan in respect of
which the Interest Period is (i) 3 months or less, the last day of such Interest
Period and (ii) more than 3 months, the date that is 3 months from the first day
of such Interest Period and, in addition, the last day of such Interest Period.
12
Interest Period. With respect to each Revolving Credit Loan, (a)
initially, the period commencing on the Drawdown Date of such Revolving Credit
Loan and ending on the last day of one of the periods set forth below, as
selected by the Borrower in a Loan Request or as otherwise required by the terms
of this Credit Agreement (i) for any Base Rate Loan, the last day of the
calendar month; and (ii) for any LIBOR Rate Loan, 1, 2, 3 or 6 months; and (b)
thereafter, each period commencing on the last day of the next preceding
Interest Period applicable to such Revolving Credit Loan and ending on the last
day of one of the periods set forth above, as selected by the Borrower in a
Conversion Request; provided that all of the foregoing provisions relating to
Interest Periods are subject to the following:
(a) if any Interest Period with respect to a LIBOR Rate Loan would
otherwise end on a day that is not a Business Day, that Interest Period
shall be extended to the next succeeding 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 immediately
preceding Business Day;
(b) if any Interest Period with respect to a Base Rate Loan would end
on a day that is not a Business Day, that Interest Period shall end on the
next succeeding Business Day;
(c) if the Borrower shall fail to give notice as provided in (S)2.7,
the Borrower shall be deemed to have requested a conversion of the affected
LIBOR Rate Loan to a Base Rate Loan and the continuance of all Base Rate
Loans as Base Rate Loans on the last day of the then current Interest
Period with respect thereto;
(d) any Interest Period relating to any LIBOR Rate Loan 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 a calendar month;
and
(e) any Interest Period that would otherwise extend beyond the
Revolving Credit A Loan Maturity Date (if comprising a Revolving Credit A
Loan) or the Revolving Credit B Loan Maturity Date (if comprising the
Revolving Credit B Loan or a portion thereof) shall end on the Revolving
Credit Loan A Maturity Date or (as the case may be) the Revolving Credit B
Loan Maturity Date.
International Standby Practices. With respect to any standby Letter of
Credit, International Standby Practices (ISP98), International Chamber of
Commerce Publication No. 590, or any successor code of standby letter of credit
practices among banks adopted by the Agent in the ordinary course of its
business as a standby letter of credit issuer and in effect at the time of
issuance of such Letter of Credit.
Investment Policy Guideline. The VSEA Investment Policy as in effect on
the Closing Date, a copy of which has been delivered to the Agent.
13
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (a) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (b) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(c) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (d) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise, except that
accrued interest included as provided in the foregoing clause (b) may be
deducted when paid; and (e) there shall not be deducted from the aggregate
amount of Investments any decrease in the value thereof.
Letter of Credit. See (S)4.1.1.
Letter of Credit Application. See (S)4.1.1.
Letter of Credit Fee. See (S)4.6.
Letter of Credit Fee Rate. As such term is used in the table contained in
the definition of "Applicable Margin".
Letter of Credit Participation. See (S)4.1.4.
Leverage Ratio. As of any date of determination, the ratio of (a) Total
Funded Indebtedness of the Borrower and its Subsidiaries outstanding on such
date to (b) the EBITDA of the Borrower and its Subsidiaries for the Reference
Period ended on such date, provided, however, when calculating the Leverage
Ratio for any period in which a Permitted Acquisition has occurred, the
calculation of the Leverage Ratio shall be made on a Pro Forma Basis.
LIBOR Business Day. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other eurodollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.
LIBOR Lending Office. Initially, the office of each Bank designated as
such in Schedule 1 hereto; thereafter, such other office of such Bank, if any,
that shall be making or maintaining LIBOR Rate Loans.
14
LIBOR Rate. For any Interest Period with respect to a LIBOR Rate Loan, the
rate of interest equal to the rate determined by the Agent at which Dollar
deposits for such Interest Period are offered based on information presented on
Telerate Page 3750 as of 11:00 a.m. London time on the second Business Day prior
to the first day of such Interest Period; provided that if for any reason the
Telerate screen shall cease to be publicly available, then the term "LIBOR Rate"
shall mean, for any Interest Period with respect to any LIBOR Rate Loan, the
rate per annum which is equal to the arithmetic average (as determined by the
Agent on the basis of quotations, if any, received by the Agent from the
Reference Banks, with such average expressed as a percentage and rounded, if
necessary, to the nearest 1/10,000 of one percent) of the average rate per annum
at which each Reference Bank is offered deposits in Dollars by prime banks in
the London Interbank Eurodollar Market as of 11:00 a.m., London time, on the day
which is two (2) Business Days prior to the beginning of such Interest Period,
for settlement on the first day of such Interest Period and for the approximate
number of days comprised therein, in an amount comparable to the amount of such
Reference Bank's portion of the principal amount of the Revolving Credit Loan of
which such LIBOR Rate Loans forms a part.
LIBOR Rate Loans. Revolving Credit Loans bearing interest calculated by
reference to the LIBOR Rate.
Loan Documents. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit and the Fee Letter.
Loan Request. See (S)2.6.
Majority Banks. As of any date, the Banks holding at least fifty one
percent (51%) of the outstanding principal amount of the Notes on such date; and
if no such principal is outstanding, the Banks whose aggregate Commitments
constitutes at least fifty one percent (51%) of the sum of the Total Revolver A
Commitment and the Total Revolver B Commitment provided, however, that if any
Bank shall be a Delinquent Bank at such time, such Delinquent Bank shall not be
entitled to vote on any matter requiring Majority Bank approval and there shall
be excluded from the determination of Majority Banks at such time (a) the
aggregate principal amount of the Loans owing to such Bank (in its capacity as a
Bank) and outstanding at such time, and (b) the aggregate unused Revolver A
Commitment and Revolver B Commitment of such Bank at such time.
Material Adverse Effect. A material adverse effect on (a) the business,
condition (financial or otherwise), operations, performance, properties or
prospects of the Borrower individually, or the Borrower and its Subsidiaries,
taken as a whole, (b) the rights and remedies of the Agent or any Bank under the
Loan Document, or (c) the ability of the Borrower to perform its Obligations
under any of the Loan Documents.
Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.
Multiemployer Plan. Any multiemployer plan within the meaning of (S)3(37)
of ERISA maintained or contributed to by the Borrower or any ERISA Affiliate.
15
Net Book Value. At the relevant time of reference thereto, the net book
value of Eligible Inventory determined on a first-in first-out basis and at
lower of cost or market.
Notes. The Revolving Credit A Notes and the Revolving Credit B Notes.
Obligations. All indebtedness, obligations and liabilities of any of the
Borrower and its Subsidiaries to any of the Banks and the Agent, individually or
collectively, existing on the date of this Credit Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
by contract, operation of law or otherwise, arising or incurred under this
Credit Agreement or any of the other Loan Documents or in respect of any of the
Revolving Credit Loans made or Reimbursement Obligations incurred or any of the
Notes, Letter of Credit Application, Letter of Credit or other instruments at
any time evidencing any thereof.
outstanding. With respect to the Revolving Credit Loans, the aggregate
unpaid principal thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by (S)4002 of ERISA
and any successor entity or entities having similar responsibilities.
Permitted Acquisition. See (S)8.5.1 hereof.
Permitted Liens. Liens, security interests and other encumbrances
permitted by (S)8.2.
Person. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
Pro Forma Basis. Following a Permitted Acquisition, Total Funded
Indebtedness (or, in the case of Consolidated Total Interest Expense, all
Indebtedness) and EBITDA for the fiscal quarter in which such Permitted
Acquisition occurred and each of the three fiscal quarters immediately following
such Permitted Acquisition being calculated with reference to the audited
historical financial results of the Person so acquired (or, to the extent such
financial results are unaudited, such unaudited results shall have been prepared
in a manner which is acceptable to the Majority Banks) and the Borrower and its
Subsidiaries for the applicable Test Period after giving effect on a pro forma
basis to such Permitted Acquisition and assuming that such Permitted Acquisition
had been consummated at the beginning of such Test Period in the manner
described in (a), (b) and (c) below:
(a) all Indebtedness (whether under this Credit Agreement or
otherwise) and any other balance sheet adjustments incurred or made in
connection with the Permitted Acquisition shall be deemed to have been
incurred or made on the first day of the Test Period, and all Indebtedness
of the Person acquired or to be acquired in such Permitted Acquisition
which was or will have been repaid in connection with the consummation of
the Permitted Acquisition shall be deemed to have been repaid concurrently
with the incurrence of the Indebtedness incurred in connection with the
Permitted Acquisition;
16
(b) all Indebtedness assumed to have been incurred pursuant to the
preceding clause (i) shall be deemed to have borne interest at the sum of
(a) the arithmetic mean of (x) the Eurocurrency Rate for LIBOR Rate Loans
having an Interest Period of one month in effect on the first day of the
Test Period and (y) the Eurocurrency Rate for LIBOR Rate Loans having an
Interest Period of one month in effect on the last day of the Test Period
plus (b) the Applicable Margin for LIBOR Rate Loans then in effect (after
giving effect to the Permitted Acquisition on a Pro Forma Basis); and
(c) other reasonable cost savings, expenses and other income
statement or operating statement adjustments which are reasonably
acceptable to the Majority Banks and which are attributable to the change
in ownership and/or management resulting from such Permitted Acquisition
shall be deemed to have been realized on the first day of the Test Period.
Rate Adjustment Period. As defined in the definition of "Applicable
Margin".
RCRA. See (S)6.18(a).
Real Estate. All real property at any time owned or leased (as lessee or
sublessee) by the Borrower or any of its Subsidiaries.
Record. The grid attached to a Note, or the continuation of such grid, or
any other similar record, including computer records, maintained by any Bank
with respect to any Revolving Credit Loan referred to in such Note.
Reference Banks. Collectively, ABN AMRO Bank N.V., Fleet National Bank and
Bank of America, N.A.
Reference Period. As of the end of any fiscal quarter, the period of (a)
four (4) consecutive fiscal quarters of the Borrower and its Subsidiaries ending
on such date, or (b) until four (4) full fiscal quarters of the Borrower have
elapsed after March 31, 2000, such shorter period of one (1), two (2), or three
(3) full fiscal quarters elapsed since March 31, 2000, with the relevant amount
applicable to such shorter period annualized for the period of four (4)
consecutive fiscal quarters for which the applicable covenant or test
calculation is being performed by multiplying such relevant amount by a fraction
whose numerator is four (4) and whose denominator is such actual number of
elapsed full fiscal quarters.
Register. See (S)18.3.
Reimbursement Obligation. The Borrower's obligation to reimburse the Agent
and the Banks on account of any drawing under any Letter of Credit as provided
in (S)4.2.
17
Reserve Charge. See (S)5.13.
Restricted Payment. In relation to the Borrower and its Subsidiaries, any
(a) Distribution or (b) payment or prepayment by the Borrower or any Subsidiary
to any shareholder of the Borrower or to any other Affiliate of a shareholder of
the Borrower.
Revolver A Commitment. With respect to each Bank, the amount set forth on
Schedule 1 hereto as the amount of such Bank's commitment to make Revolving
Credit A Loans to, and to participate in the issuance, extension and renewal of
Letters of Credit for the account of, the Borrower, as the same may be reduced
from time to time; or if such commitment is terminated pursuant to the
provisions hereof, zero.
Revolver A Commitment Fee. See (S)2.2.1 hereof.
Revolver A Commitment Percentage. With respect to each Bank, the
percentage set forth on Schedule 1 hereto as such Bank's percentage of the
aggregate Total Revolver A Commitment.
Revolver B Commitment. With respect to each Bank, the amount set forth on
Schedule 1 hereto as the amount of such Bank's commitment to make Revolving
Credit B Loans to the Borrower, as the same may be reduced from time to time; or
if such commitment is terminated pursuant to the provisions hereof, zero.
Revolver B Commitment Fee. See (S)2.2.2 hereof.
Revolver B Commitment Percentage. With respect to each Bank, the
percentage set forth on Schedule 1 hereto as such Bank's percentage of the
aggregate Total Revolver B Commitment.
Revolving Credit A Loan Maturity Date. May 16, 2003.
Revolving Credit A Loans. Revolving credit loans made or to be made by the
Banks to the Borrower pursuant to (S)2.1.1 hereof.
Revolving Credit A Note Record. A Record with respect to a Revolving
Credit A Note.
Revolving Credit A Notes. See (S)2.4.1 hereof.
Revolving Credit B Loan Maturity Date. May 15, 2001.
Revolving Credit B Loans. Revolving credit loans made or to be made by the
Banks to the Borrower pursuant to (S)2.1.2 hereof.
Revolving Credit B Note Record. A Record with respect to a Revolving
Credit B Note.
Revolving Credit B Notes. See (S)2.4.2 hereof.
18
Revolving Credit Loans. Collectively, the Revolving Credit A Loans and the
Revolving Credit B Loans.
▇▇▇▇. See (S)6.18(a).
Section 20 Subsidiary. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the Federal
Reserve Board to underwrite and deal in certain Ineligible Securities.
Settlement. The making or receiving of payments, in immediately available
funds, by the Banks, to the extent necessary to cause each Bank's actual share
of the outstanding amount of Revolving Credit A Loans (after giving effect to
any Loan Request) to be equal to such Bank's Revolver A Commitment Percentage of
the outstanding amount of such Revolving Credit A Loans (after giving effect to
any Loan Request), in any case where, prior to such event or action, the actual
share is not so equal.
Settlement Amount. See (S)2.9.1.
Settlement Date. (a) The date which is thirty (30) days after making such
Revolving Credit Loan pursuant to (S)2.6.2, (b) at the option of the Agent, on
any Business Day following a day on which the account officers of the Agent
active upon the Borrower's account become aware of the existence of an Event of
Default, (c) any Business Day on which the amount of Revolving Credit A Loans
outstanding from ABN AMRO plus ABN AMRO's share of the sum of the Maximum
Drawing Amount and any Unpaid Reimbursement Obligations is equal to or greater
than ABN AMRO's Revolver A Commitment Percentage of the Total Revolver A
Commitment, or (d) any day on which any conversion of a Base Rate Loan to a
LIBOR Rate Loan occurs.
Settling Bank. See (S)2.9.1.
Subordinated Debt. Unsecured Indebtedness of the Borrower that is
expressly subordinated and made junior to the payment and performance in full of
the Obligations, and evidenced as such by the Subordinated Debt Documents and
containing subordination provisions in form and substance approved by the Agent
in writing.
Subordinated Debt Documents. Any and all documents, agreements and
instruments evidencing any of the Subordinated Debt, in each case in form and
substance acceptable to the Agent.
Subsidiary. Any corporation, association, trust, or other business entity
of which the designated parent shall at any time own directly or indirectly
through a Subsidiary or Subsidiaries at least a majority (by number of votes) of
the outstanding Voting Stock.
Synthetic Lease. As defined in paragraph (f) of the definition of
"Indebtedness".
19
Test Period. The period of all fiscal quarters (and any portion of a
fiscal quarter) being tested in any covenant calculation period prior to the
date of such Permitted Acquisition as set forth in the definition of "Pro Forma
Basis".
Total Commitment. The sum of the Total Revolver A Commitment and the Total
Revolver B Commitment.
Total Funded Indebtedness. All Indebtedness of the Borrower and its
Subsidiaries (whether or not contingent) for borrowed money, purchase money
Indebtedness and with respect to Capitalized Leases and Synthetic Lease,
determined on a consolidated basis in accordance with Generally Accepted
Accounting Principles, provided, for purposes of calculating Indebtedness of the
Borrower under the Revolving Credit Loans at any date of determination, the
amount shall be the average outstanding amount of Revolving Credit Loans for the
immediately preceding ninety (90) days.
Total Revolver A Commitment. The sum of the Revolver A Commitments of the
Banks, as in effect from time to time.
Total Revolver B Commitment. The sum of the Revolver B Commitments of the
Banks, as in effect from time to time.
Type. As to any Revolving Credit Loan, its nature as a Base Rate Loan, or
a LIBOR Rate Loan.
Uniform Customs. With respect to any Letter of Credit, the Uniform Customs
and Practice for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500 or any successor version thereto adopted by the
Agent in the ordinary course of its business as a letter of credit issuer and in
effect at the time of issuance of such Letter of Credit.
Unpaid Reimbursement Obligation. Any Reimbursement Obligation for which
the Borrower does not reimburse the Agent and the Banks on the date specified
in, and in accordance with, (S)4.2.
Varian BV. Varian Semiconductor Equipment Associates Europe B.V.
Varian Japan. Varian Semiconductor Equipment Associates Japan ▇.▇.
▇▇▇▇▇▇ Japan Holdings. Varian Japan Holdings Ltd.
Voting Stock. Stock or similar interests, of any class or classes (however
designated), the holders of which are at the time entitled, as such holders, to
vote for the election of a majority of the directors (or persons performing
similar functions) of the corporation, association, trust or other business
entity involved, whether or not the right so to vote exists by reason of the
happening of a contingency.
20
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or modification to
such law.
(d) A reference to any Person includes its permitted successors and
permitted assigns.
(e) Accounting terms not otherwise defined herein have the meanings
assigned to them by Generally Accepted Accounting Principles applied on a
consistent basis by the accounting entity to which they refer.
(f) The words "include", "includes" and "including" are not limiting.
(g) All terms not specifically defined herein or by Generally Accepted
Accounting Principles, which terms are defined in the Uniform Commercial
Code as in effect in the Commonwealth of Massachusetts, have the meanings
assigned to them therein, with the term "instrument" being that defined
under Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "(S)" refers to that section of this
Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like import
shall refer to this Credit Agreement as a whole and not to any particular
section or subdivision of this Credit Agreement.
(j) Unless otherwise expressly indicated, in the computation of
periods of time from a specified date to a later specified date, the word
"from" means "from and including," the words "to" and "until" each mean "to
but excluding," and the word "through" means "to and including."
(k) This Credit Agreement and the other Loan Documents may use several
different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are,
however, cumulative and are to be performed in accordance with the terms
thereof.
(l) This Credit Agreement and the other Loan Documents are the result
of negotiation among, and have been reviewed by counsel to, among others,
the Agent and the Borrower and are the product of discussions and
negotiations among all parties. Accordingly, this Credit Agreement and the
other Loan Documents are not intended to be construed against the Agent or
any of the Banks merely on account of the Agent's or any Bank's involvement
in the preparation of such documents.
21
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND.
2.1.1. THE REVOLVING CREDIT A LOANS. Subject to the terms and
conditions set forth in this Credit Agreement, each of the Banks severally
agrees to lend to the Borrower and the Borrower may borrow, repay, and reborrow
from time to time from the Closing Date up to but not including the Revolving
Credit A Loan Maturity Date upon notice by the Borrower to the Agent given in
accordance with (S)2.6, such sums as are requested by the Borrower up to a
maximum aggregate amount outstanding (after giving effect to all amounts
requested) at any one time equal to such Bank's Revolver A Commitment minus such
Bank's Revolver A Commitment Percentage of the sum of the Maximum Drawing Amount
and all Unpaid Reimbursement Obligations, provided that the sum of the
outstanding amount of the Revolving Credit A Loans (after giving effect to all
amounts requested) plus the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations shall not at any time exceed the lesser of (a) the Total Revolver A
Commitment and (b) the Borrowing Base and, provided, further that the sum of the
outstanding amount of all Revolving Credit Loans (after giving effect to all
amounts requested) plus the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations shall not at any time exceed the lesser of (a) the Total Commitment
and (b) the Borrowing Base. The Revolving Credit A Loans shall be made pro rata
in accordance with each Bank's Revolver A Commitment Percentage. Each request
for a Revolving Credit A Loan hereunder shall constitute a representation and
warranty by the Borrower that the conditions set forth in (S)10 and (S)11, in
the case of the initial Revolving Credit A Loans to be made on the Closing Date,
and (S)11, in the case of all other Revolving Credit A Loans, have been
satisfied on the date of such request.
2.1.2. THE REVOLVING CREDIT B LOANS. Subject to the terms and
conditions set forth in this Credit Agreement, and only to the extent that the
aggregate outstanding amount of all Revolving Credit A Loans plus the Maximum
Drawing Amount and all Unpaid Reimbursement Obligations equal the Total Revolver
A Commitment, each of the Banks severally agrees to lend to the Borrower and the
Borrower may borrow, repay, and reborrow from time to time from the Closing Date
up to but not including the Revolving Credit B Loan Maturity Date upon notice by
the Borrower to the Agent given in accordance with (S)2.6, such sums as are
requested by the Borrower up to a maximum aggregate amount outstanding (after
giving effect to all amounts requested) at any one time equal to such Bank's
Revolver B Commitment provided that the sum of the outstanding amount of the
Revolving Credit B Loans (after giving effect to all amounts requested) shall
not at any time exceed the lesser of (a) the Total Revolver B Commitment and (b)
the Borrowing Base and, provided,
22
further that the sum of the outstanding amount of all Revolving Credit Loans
(after giving effect to all amounts requested) plus the Maximum Drawing Amount
and all Unpaid Reimbursement Obligations shall not at any time exceed the lesser
of (a) the Total Commitment and (b) the Borrowing Base. The Revolving Credit B
Loans shall be made pro rata in accordance with each Bank's Revolver B
Commitment Percentage. Each request for a Revolving Credit B Loan hereunder
shall constitute a representation and warranty by the Borrower that the
conditions set forth in (S)10 and (S)11, in the case of the initial Revolving
Credit B Loans to be made on the Closing Date, and (S)11, in the case of all
other Revolving Credit B Loans, have been satisfied on the date of such request.
2.2. COMMITMENT FEE.
2.2.1. THE REVOLVING CREDIT A LOAN COMMITMENT FEE. The Borrower agrees
to pay to the Agent for the accounts of the Banks in accordance with their
respective Revolver A Commitment Percentages a commitment fee (the "Revolver A
Commitment Fee") calculated at the rate of the Commitment Fee Rate per annum on
the average daily amount during each calendar quarter or portion thereof from
the date hereof, to the Revolving Credit A Loan Maturity Date by which the Total
Revolver A Commitment minus the sum of the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations exceeds the outstanding amount of Revolving Credit A
Loans during such calendar quarter. The Revolver A Commitment Fee shall be
payable quarterly in arrears on the first day of each calendar quarter for the
immediately preceding calendar quarter commencing on the first such date
following the date hereof, with a final payment on the Revolving Credit A Loan
Maturity Date or any earlier date on which the Revolver A Commitments shall
terminate.
2.2.2. THE REVOLVING CREDIT B LOAN COMMITMENT FEE. The Borrower
agrees to pay to the Agent for the accounts of the Banks in accordance with
their respective Revolver B Commitment Percentages a commitment fee (the
"Revolver B Commitment Fee") calculated at the rate of .375% per annum on the
average daily amount during each calendar quarter or portion thereof from the
date hereof, to the Revolving Credit Loan B Maturity Date by which the Total
Revolver B Commitment exceeds the outstanding amount of Revolving Credit B Loans
during such calendar quarter. The Revolver B Commitment Fee shall be payable
quarterly in arrears on the first day of each calendar quarter for the
immediately preceding calendar quarter commencing on the first such date
following the date hereof, with a final payment on the Revolving Credit Loan B
Maturity Date or any earlier date on which the Revolver B Commitments shall
terminate.
23
2.3. REDUCTION OF COMMITMENTS.
2.3.1. REDUCTION OF TOTAL REVOLVER A COMMITMENT. The Borrower shall
have the right at any time and from time to time upon five (5) Business Days
prior written notice to the Agent to reduce by $2,000,000 or an integral
multiple of $500,000 in excess thereof or terminate entirely the Total Revolver
A Commitment, whereupon the Revolver A Commitments of the Banks shall be reduced
pro rata in accordance with their respective Revolver A Commitment Percentages
of the amount specified in such notice or, as the case may be, terminated.
Promptly after receiving any notice of the Borrower delivered pursuant to this
(S)2.3.1, the Agent will notify the Banks of the substance thereof. Upon the
effective date of any such reduction or termination, the Borrower shall pay to
the Agent for the respective accounts of the Banks the full amount of any
Revolver A Commitment Fee then accrued on the amount of the reduction. No
reduction or termination of the Revolver A Commitments may be reinstated.
2.3.2. REDUCTION OF TOTAL REVOLVER B COMMITMENT. The Borrower shall
have the right at any time and from time to time upon five (5) Business Days
prior written notice to the Agent to reduce by $2,000,000 or an integral
multiple of $500,000 in excess thereof or terminate entirely the Total Revolver
B Commitment, whereupon the Revolver B Commitments of the Banks shall be reduced
pro rata in accordance with their respective Revolver B Commitment Percentages
of the amount specified in such notice or, as the case may be, terminated;
provided, however, that notwithstanding anything to the contrary contained
herein, the Borrower shall not be permitted to reduce or terminate the Total
Revolver B Commitment unless a pro rata reduction of the Total Revolver A
Commitment is simultaneously made. Promptly after receiving any notice of the
Borrower delivered pursuant to this (S)2.3.2, the Agent will notify the Banks of
the substance thereof. Upon the effective date of any such reduction or
termination, the Borrower shall pay to the Agent for the respective accounts of
the Banks the full amount of any Revolver B Commitment Fee then accrued on the
amount of the reduction. No reduction or termination of the Revolver B
Commitments may be reinstated.
2.4. THE NOTES.
2.4.1. REVOLVING CREDIT A NOTES. The Revolving Credit A Loans shall
be evidenced by separate promissory notes of the Borrower in substantially the
form of Exhibit B-1 hereto (each a "Revolving Credit A Note"), dated as of the
Closing Date and completed with appropriate insertions. One Revolving Credit A
Note shall be payable to the order of each Bank in a principal amount equal to
such Bank's Revolver A Commitment or, if less, the outstanding amount of all
Revolving Credit A Loans made by such Bank, plus interest accrued thereon, as
set forth below. The Borrower irrevocably authorizes each Bank to make or cause
to be made, at or about the time of the Drawdown Date of any Revolving Credit A
Loan or at the time of receipt of any payment of principal on such Bank's
Revolving Credit A Note, an appropriate notation on such Bank's Revolving Credit
A Note Record reflecting the making of such Revolving Credit A Loan or (as the
case may be) the receipt of such payment. The outstanding amount of the
Revolving Credit A Loans set forth on such Bank's Revolving Credit A Note Record
shall be prima facie evidence of the principal amount thereof owing and unpaid
to such Bank, but the failure to record, or any error in so recording, any such
amount on such Bank's Revolving Credit A Note Record shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any
Revolving Credit A Note to make payments of principal of or interest on any
Revolving Credit A Note when due.
24
2.4.2. REVOLVING CREDIT B NOTES. The Revolving Credit B Loans shall
be evidenced by separate promissory notes of the Borrower in substantially the
form of Exhibit B-2 hereto (each a "Revolving Credit B Note"), dated as of the
Closing Date and completed with appropriate insertions. One Revolving Credit B
Note shall be payable to the order of each Bank in a principal amount equal to
such Bank's Revolver B Commitment or, if less, the outstanding amount of all
Revolving Credit B Loans made by such Bank, plus interest accrued thereon, as
set forth below. The Borrower irrevocably authorizes each Bank to make or cause
to be made, at or about the time of the Drawdown Date of any Revolving Credit B
Loan or at the time of receipt of any payment of principal on such Bank's
Revolving Credit B Note, an appropriate notation on such Bank's Revolving Credit
B Note Record reflecting the making of such Revolving Credit B Loan or (as the
case may be) the receipt of such payment. The outstanding amount of the
Revolving Credit B Loans set forth on such Bank's Revolving Credit B Note Record
shall be prima facie evidence of the principal amount thereof owing and unpaid
to such Bank, but the failure to record, or any error in so recording, any such
amount on such Bank's Revolving Credit B Note Record shall not limit or
otherwise affect the obligations of the Borrower hereunder or under any
Revolving Credit B Note to make payments of principal of or interest on any
Revolving Credit B Note when due.
2.5. INTEREST ON REVOLVING CREDIT LOANS. Except as otherwise provided in
(S)5.11,
(a) Each Base Rate Loan shall bear interest for the period commencing
with the Drawdown Date thereof and ending on the last day of the Interest
Period with respect thereto at the rate per annum equal to the Base Rate
plus the Applicable Margin for the Base Rate Loans.
(b) Each LIBOR Rate Loan shall bear interest for the period commencing
with the Drawdown Date thereof and ending on the last day of the Interest
Period with respect thereto at the rate of per annum equal to the LIBOR
Rate determined for such Interest Period plus the Applicable Margin for
LIBOR Rate Loans.
(c) The Borrower promises to pay interest on each Revolving Credit
Loan in arrears on each Interest Payment Date with respect thereto.
25
2.6. REQUESTS FOR REVOLVING CREDIT LOANS.
2.6.1. GENERAL. The Borrower shall give to the Agent written notice
in the form of Exhibit C hereto (or telephonic notice confirmed in a writing in
the form of Exhibit C hereto) of each Revolving Credit Loan requested hereunder
(a "Loan Request") no less than (a) one (1) Business Day prior to the proposed
Drawdown Date of any Base Rate Loan and (b) three (3) Business Days prior to the
proposed Drawdown Date of any LIBOR Rate Loan. Each such notice shall specify
(a) the principal amount of the Revolving Credit Loan requested, (b) the
proposed Drawdown Date of such Revolving Credit Loan, (c) the Interest Period
for such Revolving Credit Loan, (d) the Type of such Revolving Credit Loan and
(e) whether a Revolving Credit A Loan or a Revolving Credit B Loan is being
requested (provided, however, no Revolving Credit B Loan shall be permitted to
be requested hereunder until such time as the aggregate outstanding amount of
the Revolving Credit A Loans plus the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations equal the Total Revolver A Commitment). Promptly upon
receipt of any such notice, the Agent shall notify each of the Banks thereof.
Each Loan Request shall be irrevocable and binding on the Borrower and shall
obligate the Borrower to accept the Revolving Credit Loan requested from the
Banks on the proposed Drawdown Date. Each Loan Request shall be in a minimum
aggregate amount of $2,000,000 or an integral multiple of $500,000 in excess
thereof.
2.6.2. SWING LINE. Notwithstanding the notice and minimum amount
requirements set forth in (S)2.6.1 but otherwise in accordance with the terms
and conditions of this Credit Agreement, the Agent may, at the Borrower's
request and in the Agent's sole discretion and without conferring with the
Banks, make Revolving Credit A Loans to the Borrower in an amount requested by
the Borrower, provided, that the aggregate outstanding amount of all Revolving
Credit A Loans made by the Agent pursuant to this (S)2.6.2 shall not exceed
$5,000,000 at any one time. The Borrower hereby requests and authorizes the
Agent to make from time to time such Revolving Credit A Loans by means of
appropriate entries of such credits sufficient to cover checks and other charges
then presented for payment from the Operating Account or as otherwise so
requested. The Borrower acknowledges and agrees that the making of such
Revolving Credit A Loans shall, in each case, be subject in all respects to the
provisions of this Credit Agreement as if they were Revolving Credit A Loans
covered by a Loan Request including, without limitation, the limitations set
forth in (S)2.1 and the requirements that the applicable provisions of (S)10 (in
the case of Revolving Credit A Loans made on the Closing Date) and (S)11 be
satisfied. All actions taken by the Agent pursuant to the provisions of this
(S)2.6.2 shall be conclusive and binding on the Borrower and the Banks absent
the Agent's gross negligence or willful misconduct. Revolving Credit A Loans
made pursuant to this (S)2.6.2 shall be Base Rate Loans until converted in
accordance with the provisions of the Credit Agreement and, prior to a
Settlement, such interest shall be for the account of the Agent.
26
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF REVOLVING CREDIT LOAN. The
Borrower may elect from time to time to convert any outstanding Revolving Credit
Loan to a Revolving Credit Loan of another Type, provided that (a) with respect
to any such conversion of a LIBOR Rate Loan to a Base Rate Loan, the Borrower
shall give the Agent at least one (1) Business Days prior written notice of such
election; (b) with respect to any such conversion of a Base Rate Loan to a LIBOR
Rate Loan, the Borrower shall give the Agent at least three (3) Business Days
prior written notice of such election; (c) with respect to any such conversion
of a LIBOR Rate Loan into a Revolving Credit Loan of another Type, such
conversion shall only be made on the last day of the Interest Period with
respect thereto and (d) no Base Rate Loan may be converted into a LIBOR Rate
Loan when any Default or Event of Default has occurred and is continuing. On the
date on which such conversion is being made each Bank shall take such action as
is necessary to transfer its Revolver A Commitment Percentage or Revolver B
Commitment Percentage, as the case may be, of such Revolving Credit Loans to its
Domestic Lending Office or its LIBOR Lending Office, as the case may be. All or
any part of outstanding Revolving Credit Loans of any Type may be converted into
a Revolving Credit Loan of another Type as provided herein, provided that any
partial conversion shall be in an aggregate principal amount of $500,000 or a
whole multiple thereof. Each Conversion Request relating to the conversion of a
Revolving Credit Loan to a LIBOR Rate Loan shall be irrevocable by the Borrower.
2.7.2. CONTINUATION OF TYPE OF REVOLVING CREDIT LOAN. Any Revolving
Credit Loan of any Type may be continued as a Revolving Credit Loan of the same
Type upon the expiration of an Interest Period with respect thereto by
compliance by the Borrower with the notice provisions contained in (S)2.7.1;
provided that as to LIBOR Rate Loans, no such LIBOR Rate Loan may be continued
as such when any Default or Event of Default has occurred and is continuing, but
shall be automatically converted to a Base Rate Loan on the last day of the
first Interest Period relating thereto ending during the continuance of any
Default or Event of Default of which officers of the Agent active upon the
Borrower's account have actual knowledge. In the event that the Borrower fails
to provide any such notice with respect to the continuation of any LIBOR Rate
Loan as such, then such LIBOR Rate Loan shall be automatically converted to a
Base Rate Loan on the last day of the first Interest Period relating thereto.
The Agent shall notify the Banks promptly when any such automatic conversion
contemplated by this (S)2.7 is scheduled to occur.
2.7.3. LIBOR RATE LOANS. Any conversion to or from LIBOR Rate Loans
shall be in such amounts and be made pursuant to such elections so that, after
giving effect thereto, the aggregate principal amount of all LIBOR Rate Loans
having the same Interest Period shall not be less than $500,000 or a whole
multiple of $100,000 thereof.
27
2.8. FUNDS FOR REVOLVING CREDIT LOAN.
2.8.1. FUNDING PROCEDURES. Not later than 11:00 a.m. (Chicago time)
on the proposed Drawdown Date of any Revolving Credit Loans, each of the Banks
will make available to the Agent, at the Agent's Office, in immediately
available funds, the amount of such Bank's Revolver A Commitment Percentage or
Revolver B Commitment Percentage of the amount of the requested Revolving Credit
A Loans or Revolving Credit B Loans, as the case may be. Upon receipt from each
Bank of such amount, and upon receipt of the documents required by (S)(S)10 and
11 and the satisfaction of the other conditions set forth therein, to the extent
applicable, the Agent will make available to the Borrower the aggregate amount
of such Revolving Credit Loans made available to the Agent by the Banks. The
failure or refusal of any Bank to make available to the Agent at the aforesaid
time and place on any Drawdown Date the amount of its Revolver A Commitment
Percentage or Revolver B Commitment Percentage, as the case may be, of the
requested Revolving Credit A Loans or Revolving Credit B Loans, as the case may
be, shall not relieve any other Bank from its several obligation hereunder to
make available to the Agent the amount of such other Bank's Revolver A
Commitment Percentage or Revolver B Commitment Percentage, as the case may be,
of any requested Revolving Credit A Loans or Revolving Credit B Loans, as the
case may be.
2.8.2. ADVANCES BY AGENT. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such Bank has made
available to the Agent on such Drawdown Date the amount of such Bank's Revolver
A Commitment Percentage or Revolver B Commitment Percentage, as the case may be,
of the Revolving Credit A Loans or Revolving Credit B Loans, as the case may be,
to be made on such Drawdown Date, and the Agent may (but it shall not be
required to), in reliance upon such assumption, make available to the Borrower a
corresponding amount. If any Bank makes available to the Agent such amount on a
date after such Drawdown Date, such Bank shall pay to the Agent on demand an
amount equal to the product of (a) the average computed for the period referred
to in clause (c) below, of the weighted average interest rate paid by the Agent
for federal funds acquired by the Agent during each day included in such period,
times (b) the amount of such Bank's Revolver A Commitment Percentage or Revolver
B Commitment Percentage, as the case may be, of such Revolving Credit A Loans or
Revolving Credit B Loans, as the case may be, times (c) a fraction, the
numerator of which is the number of days that elapse from and including such
Drawdown Date to the date on which the amount of such Bank's Revolver A
Commitment Percentage or Revolver B Commitment Percentage, as the case may be,
of such Revolving Credit A Loans or Revolving Credit B Loans, as the case may
be, shall become immediately available to the Agent, and the denominator of
which is 365. A statement of the Agent submitted to such Bank with respect to
any amounts owing under this paragraph shall be prima facie evidence of the
amount due and owing to the Agent by such Bank. If the amount of such Bank's
Revolver A Commitment Percentage or Revolver B Commitment Percentage, as the
case may be, of such Revolving Credit A Loans or Revolving Credit B Loans, as
the case may be, is not made available to the Agent by such Bank within three
(3) Business Days following such Drawdown Date, the Agent shall be entitled to
recover such amount from the Borrower on demand, with interest thereon at the
rate per annum applicable to the Revolving Credit Loans made on such Drawdown
Date.
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2.9. SETTLEMENTS OF SWING LINE.
2.9.1. GENERAL. On each Settlement Date, the Agent shall, not later
than 11:00 a.m. (Chicago time), give telephonic or facsimile notice (a) to the
Banks and the Borrower of the respective outstanding amount of Revolving Credit
A Loans made by the Agent on behalf of the Banks from the immediately preceding
Settlement Date through the close of business on the prior day and the amount of
any LIBOR Rate Loans to be made on such date pursuant to a Loan Request and (b)
to the Banks of the amount (a "Settlement Amount") that each Bank (a "Settling
Bank") shall pay to effect a Settlement of any Revolving Credit A Loan made by
the Agent under (S)2.6.2. A statement of the Agent submitted to the Banks and
the Borrower or to the Banks with respect to any amounts owing under this (S)2.9
shall be prima facie evidence of the amount due and owing. Each Settling Bank
shall, not later than 3:00 p.m. (Chicago time) on such Settlement Date, effect a
wire transfer of immediately available funds to the Agent in the amount of the
Settlement Amount for such Settling Bank. All funds advanced by any Bank as a
Settling Bank pursuant to this (S)2.9 shall for all purposes be treated as a
Revolving Credit A Loan made by such Settling Bank to the Borrower and all funds
received by any Bank pursuant to this (S)2.9 shall for all purposes be treated
as repayment of amounts owed with respect to Revolving Credit A Loans made by
such Bank. In the event that any bankruptcy, reorganization, liquidation,
receivership or similar cases or proceedings in which the Borrower is a debtor
prevent a Settling Bank from making any Revolving Credit A Loan to effect a
Settlement as contemplated hereby, such Settling Bank will make such
dispositions and arrangements with the other Banks with respect to such
Revolving Credit A Loans, either by way of purchase of participations,
distribution, pro tanto assignment of claims, subrogation or otherwise as shall
result in each Bank's share of the outstanding Revolving Credit Loans being
equal, as nearly as may be, to such Bank's Commitment Percentage of the
outstanding amount of the Revolving Credit Loans.
2.9.2. FAILURE TO MAKE FUNDS AVAILABLE. The Agent may, unless
notified to the contrary by any Settling Bank prior to a Settlement Date, assume
that such Settling Bank has made or will make available to the Agent on such
Settlement Date the amount of such Settling Bank's Settlement Amount. If any
Settling Bank makes available to the Agent such amount on a date after such
Settlement Date, such Settling Bank shall pay to the Agent on demand an amount
equal to the product of (a) the average computed for the period referred to in
clause (c) below, of the weighted average interest rate paid by the Agent for
federal funds acquired by the Agent during each day included in such period,
times (b) the amount of such Settlement Amount, times (c) a fraction, the
numerator of which
2.9.3. NO EFFECT ON OTHER BANKS. The failure or refusal of any
Settling Bank to make available to the Agent at the aforesaid time and place on
any Settlement Date the amount of such Settling Bank's Settlement Amount shall
not (a) relieve any other Settling Bank from its several obligations hereunder
to make available to the Agent the amount of such other Settling Bank's
Settlement Amount or (b) impose upon any Bank, other than the Settling Bank so
failing or refusing, any liability with respect to such failure or refusal or
otherwise increase the Revolver A Commitment of such other Bank.
2.10. CHANGE IN BORROWING BASE. The Borrowing Base shall be
determined monthly (or at such other interval as may be specified pursuant to
(S)7.4(e)) by the Agent by reference to the Borrowing Base Report, commercial
finance and collateral audit reports, delivered to the Banks and the Agent
pursuant to (S)7.4(e) and other information obtained by or provided to the
Agent. The Agent shall give to the Borrower and the Banks written notice of any
change in the Borrowing Base determined by the Agent. In the case of a reduction
in the lending formula with respect to Eligible Accounts Receivable or Eligible
Inventory in the manner set forth in the definition of "Borrowing Base", such
notice shal be effective five (5) days after its receipt by the Borrower, and in
the case of any change in the general criteria for Eligible Accounts Receivable
or Eligible Inventory as set forth in the definition of "Borrowing Base", such
notice shall be effective upon its receipt by the Borrower. Prior to the time
that such notice becomes effective the Borrowing Base shall be computed as it
would have been computed in the absence of such notice.
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3. REPAYMENT OF THE REVOLVING CREDIT LOANS.
3.1. MATURITY.
3.1.1 REVOLVING CREDIT A LOANS. The Borrower promises topay on the
Revolving Credit A Loan Maturity Date, and there shall become absolutely due and
payable on the Revolving Credit A Loan Maturity Date, all of the Revolving
Credit A Loans outstanding on such date, together with any and all accrued and
unpaid interest thereon.
3.1.2. REVOLVING CREDIT B LOANS. The Borrower promises to pay on the
Revolving Credit B Loan Maturity Date, and there shall become absolutely due and
payable on the Revolving Credit B Loan Maturity Date, all of the Revolving
Credit B Loans outstanding on such date, together with any and all accrued and
unpaid interest thereon.
3.2. MANDATORY REPAYMENT OF REVOLVING CREDIT LOANS.
3.2.1. REVOLVING CREDIT A LOANS. If at any time the sum of the
outstanding amount of the Revolving Credit A Loans, the Maximum Drawing Amount
and all Unpaid Reimbursement Obligations exceeds the lesser of (a) the Total
Revolver A Commitment and (b) the Borrowing Base, then the Borrower shall
immediately pay the amount of such excess to the Agent for the respective
accounts of the Banks for application: first, to any Unpaid Reimbursement
Obligations; second, to the Revolving Credit A Loans; and third, to provide to
the Agent cash collateral for Reimbursement Obligations as contemplated by
(S)4.2(b) and (c). Each payment of any Unpaid Reimbursement Obligations or
prepayment of Revolving Credit A Loans shall be allocated among the Banks, in
proportion, as nearly as practicable, to each Reimbursement Obligation or (as
the case may be) the respective unpaid principal amount of each Bank's Revolving
Credit A Note, with adjustments to the extent practicable to equalize any prior
payments or repayments not exactly in proportion.
3.2.2. REVOLVING CREDIT B LOANS. If at any time the sum of the
outstanding amount of the Revolving Credit B Loans exceeds the lesser of (a) the
Total Revolver B Commitment and (b) the Borrowing Base, then the Borrower shall
immediately pay the amount of such excess to the Agent for the respective
accounts of the Banks for application to the Revolving Credit B Loans. Each
prepayment of Revolving Credit B Loans shall be allocated among the Banks, in
proportion, as nearly as practicable, to the respective unpaid principal amount
of each Bank's Revolving Credit B Note, with adjustments to the extent
practicable to equalize any prior payments or repayments not exactly in
proportion.
3.2.3. REVOLVING CREDIT LOANS. If at any time the sum of the
outstanding amount of the Revolving Credit Loans, the Maximum Drawing Amount and
all Unpaid Reimbursement Obligations exceed the lesser of (a) the Total
Commitment and (b) the Borrowing Base, then the Borrower shall immediately pay
the amount of such excess to the Agent for the respective accounts of the Banks
for application: first, to the Revolving Credit B Loans and second, in the
manner set forth in (S)3.2.1. Each prepayment of Revolving Credit Loans shall be
allocated among the Banks, in proportion, as nearly as practicable, to the
respective unpaid principal amount of each Bank's Note, with adjustments to the
extent practicable to equalize any prior payments or repayments not exactly in
proportion.
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3.3. OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS. The Borrower shall have
the right, at its election, to repay the outstanding amount of the Revolving
Credit Loans, as a whole or in part, at any time without penalty or premium,
provided that any full or partial prepayment of the outstanding amount of any
LIBOR Rate Loans pursuant to this (S)3.3 may be made only on the last day of the
Interest Period relating thereto. The Borrower shall give the Agent, no later
than 10:00 a.m., Chicago time, at least one (1) Business Day prior written
notice of any proposed prepayment pursuant to this (S)3.3 of Base Rate Loans,
and three (3) Business Days notice of any proposed prepayment pursuant to this
(S)3.3 of LIBOR Rate Loans, in each case specifying the proposed date of
prepayment of Revolving Credit Loans and the principal amount to be prepaid.
Each such partial prepayment of the Revolving Credit Loans shall be in an amount
of not less than $2,000,000 and an integral multiple of $500,000 in excess
thereof, shall be accompanied by the payment of accrued interest on the
principal prepaid to the date of prepayment and shall be applied, in the absence
of instruction by the Borrower, first to the principal of Base Rate Loans and
then to the principal of LIBOR Rate Loans. Notwithstanding anything to the
contrary contained herein, all optional repayments hereunder shall be applied
first to the outstanding Revolving Credit B Loans and then, to the extent the
Revolving Credit B Loans have been repaid in full, to the Revolving Credit A
Loans. Each partial prepayment shall be allocated among the Banks, in
proportion, as nearly as practicable, to the respective unpaid principal amount
of each Bank's Note, with adjustments to the extent practicable to equalize any
prior repayments not exactly in proportion.
4. LETTERS OF CREDIT.
4.1. LETTER OF CREDIT COMMITMENTS.
4.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the terms and
conditions hereof and the execution and delivery by the Borrower of a letter of
credit application on the Agent's customary form (a "Letter of Credit
Application"), the Agent on behalf of the Banks and in reliance upon the
agreement of the Banks set forth in (S)4.1.4 and upon the representations and
warranties of the Borrower contained herein, agrees, in its individual capacity,
to issue, extend and renew for the account of the Borrower one or more standby
or documentary letters of credit (individually, a "Letter of Credit"), in such
form as may be requested from time to time by the Borrower and agreed to by the
Agent; provided, however, that, after giving effect to such request, (a) the sum
of the aggregate Maximum Drawing Amount and all Unpaid Reimbursement Obligations
shall not exceed $15,000,000 at any one time, (b) the sum of (i) the Maximum
Drawing Amount on all Letters of Credit, (ii) all Unpaid Reimbursement
Obligations, and (iii) the amount of all Revolving Credit A Loans outstanding
shall not exceed the lesser of (A) the Total Revolver A Commitment and (B) the
Borrowing Base and (c) the sum of (i) the Maximum Drawing Amount on all Letters
of Credit, (ii) all Unpaid Reimbursement Obligations, and (iii) the amount of
all Revolving Credit Loans outstanding shall not exceed the lesser of (A) the
Total Commitment and (B) the Borrowing Base.
4.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Agent. In the event
that any provision of any Letter of Credit Application shall be inconsistent
with any provision of this Credit Agreement, then the provisions of this Credit
Agreement shall, to the extent of any such inconsistency, govern.
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4.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit issued,
extended or renewed hereunder shall, among other things, (a) provide for the
payment of sight and time drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (b) have an expiry date no later than the earlier of (i)
one (1) year from the date of issuance of such Letter of Credit and (ii) the
date which is fourteen (14) days (or, if the Letter of Credit is confirmed by a
confirmer or otherwise provides for one or more nominated persons, forty-five
(45) days) prior to the Revolving Credit A Loan Maturity Date. Each Letter of
Credit so issued, extended or renewed shall be subject to the Uniform Customs
or, in the case of a standby Letter of Credit, either the Uniform Customs or the
International Standby Practices.
4.1.4. REIMBURSEMENT OBLIGATIONS OF BANKS. Each Bank severally agrees
that it shall be absolutely liable, without regard to the occurrence of any
Default or Event of Default or any other condition precedent whatsoever, to the
extent of such Bank's Revolver A Commitment Percentage, to reimburse the Agent
on demand for the amount of each draft paid by the Agent under each Letter of
Credit to the extent that such amount is not reimbursed by the Borrower pursuant
to (S)4.2 (such agreement for a Bank being called herein the "Letter of Credit
Participation" of such Bank).
4.1.5. PARTICIPATIONS OF BANKS. Each such payment made by a Bank shall
be treated as the purchase by such Bank of a participating interest in the
Borrower's Reimbursement Obligation under (S)4.2 in an amount equal to such
payment. Each Bank shall share in accordance with its participating interest in
any interest which accrues pursuant to (S)4.2.
4.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the Agent
to issue, extend and renew each Letter of Credit and the Banks to participate
therein, the Borrower hereby agrees to reimburse or pay to the Agent, for the
account of the Agent or (as the case may be) the Banks, with respect to each
Letter of Credit issued, extended or renewed by the Agent hereunder,
(a) except as otherwise expressly provided in (S)4.2(b) and (c), on
each date that any draft presented under such Letter of Credit is honored
by the Agent, or the Agent otherwise makes a payment with respect thereto,
(i) the amount paid by the Agent under or with respect to such Letter of
Credit, and (ii) the amount of any taxes, fees, charges or other costs and
expenses whatsoever incurred by the Agent or any Bank in connection with
any payment made by the Agent or any Bank under, or with respect to, such
Letter of Credit,
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(b) upon the reduction (but not termination) of the Total Revolver A
Commitment to an amount less than the Maximum Drawing Amount, an amount
equal to such difference, which amount shall be held by the Agent for the
benefit of the Banks and the Agent as cash collateral for all Reimbursement
Obligations, and
(c) upon the termination of the Total Revolver A Commitment, or the
acceleration of the Reimbursement Obligations with respect to all Letters
of Credit in accordance with (S)12, an amount equal to the then Maximum
Drawing Amount on all Letters of Credit, which amount shall be held by the
Agent for the benefit of the Banks and the Agent as cash collateral for all
Reimbursement Obligations.
Each such payment shall be made to the Agent at the Agent's Office in
immediately available funds. Interest on any and all amounts remaining unpaid
by the Borrower under this (S)4.2 at any time from the date such amounts become
due and payable (whether as stated in this (S)4.2, by acceleration or otherwise)
until payment in full (whether before or after judgment) shall be payable to the
Agent on demand at the rate specified in (S)5.11 for overdue principal on the
Revolving Credit A Loans.
4.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Agent shall
notify the Borrower of the date and amount of the draft presented or demand for
payment and of the date and time when it expects to pay such draft or honor such
demand for payment. If the Borrower fails to reimburse the Agent as provided in
(S)4.2 on or before the date that such draft is paid or other payment is made by
the Agent, the Agent may at any time thereafter notify the Banks of the amount
of any such Unpaid Reimbursement Obligation. No later than 3:00 p.m. (Chicago
time) on the Business Day next following the receipt of such notice, each Bank
shall make available to the Agent, at the Agent's Office, in immediately
available funds, such Bank's Revolver A Commitment Percentage of such Unpaid
Reimbursement Obligation, together with an amount equal to the product of (a)
the average, computed for the period referred to in clause (c) below, of the
weighted average interest rate paid by the Agent for federal funds acquired by
the Agent during each day included in such period, times (b) the amount equal to
such Bank's Revolver A Commitment Percentage of such Unpaid Reimbursement
Obligation, times (c) a fraction, the numerator of which is the number of days
that elapse from and including the date the Agent paid the draft presented for
honor or otherwise made payment to the date on which such Bank's Revolver A
Commitment Percentage of such Unpaid Reimbursement obligation shall become
immediately available to the Agent, and the denominator of which is 365. The
responsibility of the Agent to the Borrower and the Banks shall be only to
determine that the documents (including each draft) delivered under each Letter
of Credit in connection with such presentment shall be in conformity in all
material respects with such Letter of Credit.
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4.4. OBLIGATIONS ABSOLUTE. The Borrower's obligations under this (S)4 shall
be absolute and unconditional under any and all circumstances and irrespective
of the occurrence of any Default or Event of Default or any condition precedent
whatsoever or any setoff, counterclaim or defense to payment which the Borrower
may have or have had against the Agent, any Bank or any beneficiary of a Letter
of Credit. The Borrower further agrees with the Agent and the Banks that the
Agent and the Banks shall not be responsible for, and the Borrower's
Reimbursement Obligations under (S)4.2 shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements thereon,
even if such documents should in fact prove to be in any or all respects
invalid, fraudulent or forged, or any dispute between or among the Borrower, the
beneficiary of any Letter of Credit or any financing institution or other party
to which any Letter of Credit may be transferred or any claims or defenses
whatsoever of the Borrower against the beneficiary of any Letter of Credit or
any such transferee. The Agent and the Banks shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any
message or advice, however transmitted, in connection with any Letter of Credit.
The Borrower agrees that any action taken or omitted by the Agent or any Bank
under or in connection with each Letter of Credit and the related drafts and
documents, if done in good faith, shall be binding upon the Borrower and shall
not result in any liability on the part of the Agent or any Bank to the
Borrower. Nothing contained in this (S)4.4 shall in any manner limit or
otherwise affect any claims the Borrower may have against the Agent arising from
the gross negligence or willful misconduct of the Agent as the issuer of any
Letter of Credit.
4.5. RELIANCE BY ISSUER. To the extent not inconsistent with (S)4.4, the
Agent shall be entitled to rely, and shall be fully protected in relying upon,
any Letter of Credit, draft, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document believed by it to be genuine and correct and
to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel, independent accountants and other
experts selected by the Agent.
4.6. LETTER OF CREDIT FEE. The Borrower shall pay a fee (in each case, a
"Letter of Credit Fee") to the Agent in respect of each Letter of Credit in an
amount equal to the Letter of Credit Rate per annum of the face amount of such
Letter of Credit, plus, as to standby Letters of Credit, an amount equal to 0.15
percent (.15%) per annum of the face amount of such Letter of Credit for the
account of the Agent, as a fronting fee. The Letter of Credit Fee other than the
fronting fee shall be for the accounts of the Banks in accordance with their
respective Revolver A Commitment Percentages. The Borrower shall pay the Letter
of Credit Fees quarterly in arrears. In respect of each Letter of Credit, the
Borrower shall also pay to the Agent for the Agent's own account, at such other
time or times as such charges are customarily made by the Agent, the Agent's
customary issuance, amendment, negotiation or document examination and other
administrative fees as in effect from time to time.
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5. CERTAIN GENERAL PROVISIONS.
5.1. CLOSING FEES. The Borrower agrees to pay to the Agent on the Closing
Date a closing fee in the amount and at the times specified in the Fee Letter.
5.2. AGENT'S FEE. The Borrower shall pay to the Agent, for the Agent's own
account, an Agent's fee in the amount and at the times specified in the Fee
Letter.
5.3. FUNDS FOR PAYMENTS.
5.3.1. PAYMENTS TO AGENT. All payments of principal and interest on
Revolving Credit Loans made to the Borrower, and all Reimbursement Obligations,
Revolver A Commitment Fees, Revolver B Commitment Fees, Letter of Credit Fees
and any other amounts due hereunder or under any of the other Loan Documents
shall be made on the due date thereof to the Agent in Dollars, for the
respective accounts of the Banks and the Agent, at the Agent's Office or at such
other place that the Agent may from time to time designate, in each case at or
about 11:00 a.m. (Chicago, Illinois, time or other local time at the place of
payment) and in immediately available funds.
5.3.2. NO OFFSET, ETC. All payments by the Borrower hereunder and
under any of the other Loan Documents shall be made without recoupment, setoff
or counterclaim and free and clear of and without deduction for any taxes,
levies, imposts, duties, charges, fees, deductions, withholdings, compulsory
loans, restrictions or conditions of any nature now or hereafter imposed or
levied by any jurisdiction or any political subdivision thereof or taxing or
other authority therein unless the Borrower is compelled by law to make such
deduction or withholding. Except as otherwise expressly provided in this (S)5.3,
if any such obligation is imposed upon the Borrower with respect to any amount
payable by it hereunder or under any of the other Loan Documents, the Borrower
will pay to the Agent, for the account of the Banks or (as the case may be) the
Agent, on the date on which such amount is due and payable hereunder or under
such other Loan Document, such additional amount in Dollars as shall be
necessary to enable the Banks or the Agent to receive the same net amount which
the Banks or the Agent would have received on such due date had no such
obligation been imposed upon the Borrower. The Borrower will deliver promptly to
the Agent certificates or other valid vouchers for all taxes or other charges
deducted from or paid with respect to payments made by the Borrower hereunder or
under such other Loan Document.
5.3.3. WITHHOLDING FORMS. Each Bank that is not incorporated or
organized under the laws of the United States of America or a state thereof or
the District of Columbia (a "Non-U.S. Bank") agrees that it will deliver to the
Borrower and the Agent, on or before the Closing Date, or, in the case of any
Non-U.S. Bank that becomes a Bank pursuant to an Assignment and Acceptance, on
or before the date of such Assignment and Acceptance, two duly completed copies
of United States Internal Revenue Service Form 1001 or 4224 (or a successor
form) and an Internal Revenue Service Form W-8 or W-9 (or a successor form)
certifying that such Non-U.S. Bank is entitled to receive all payments under
this Credit Agreement and the Notes without deduction or withholding of any
United States federal income taxes. Each Non-U.S. Bank that so delivers a Form
1001 or 4224 and Form W-8 or W-9 further undertakes to deliver to the Borrower
and the Agent two (2) additional copies of such form (or a successor form) on or
before the date that such form expires or becomes
35
obsolete or promptly after the occurrence of any event requiring a change in the
most recent form so delivered by it, and such amendments thereto or extensions
or renewals thereof as may be reasonably requested by the Borrower or the Agent,
in each case certifying that such Non-U.S. Bank is entitled to receive payments
under this Credit Agreement and the Notes without deduction or withholding of
any United States federal income taxes, unless an event (including any change in
treaty, law, or regulation) has occurred prior to the date on which any such
delivery would otherwise be required that renders all such forms inapplicable or
that would prevent such Non-U.S. Bank from duly completing and delivering any
such form with respect to it and such Non-U.S. Bank advises the Borrower and the
Agent that it is not capable of receiving payments without any deduction or
withholding of United States federal income tax.
5.3.4. EXCLUSIONS. The Borrower shall not be required to pay any
additional amounts to any Non-U.S. Bank in respect of United States Federal
withholding tax pursuant to (S)5.3.2 above to the extent that (a) the obligation
to withhold amounts with respect to United States Federal withholding tax
existed on the date such Non-U.S. Bank became a party to this Credit Agreement
or, with respect to payments to a different lending office designated by the
Non-U.S. Bank as its applicable lending office (a "New Lending Office"), on the
date such Non-U.S. Bank designated such New Lending Office with respect to a
Revolving Credit Loan; provided, however, that this clause (a) shall not apply
with respect to any transferee or New Lending Office as a result of an
assignment, transfer or designation made at the request of the Borrower; or (b)
the obligation to pay such additional amounts would not have arisen but for a
failure by such Non-U.S. Bank to comply with the provisions of (S)5.3.3. above.
5.4. COMPUTATIONS. All computations of interest on the Base Rate Loans
shall be based on a 365-day year and paid for the actual number of days elapsed.
All computations of interest on LIBOR Rate Loans and of the Revolver A
Commitment Fee, the Revolver B Commitment Fee, Letter of Credit Fees or other
fees shall, unless otherwise expressly provided herein, be based on a 360-day
year and paid for the actual number of days elapsed. Except as otherwise
provided in the definition of the term "Interest Period" with respect to LIBOR
Rate Loans, whenever a payment hereunder or under any of the other Loan
Documents becomes due on a day that is not a Business Day, the due date for such
payment shall be extended to the next succeeding Business Day, and interest
shall accrue during such extension. The outstanding amount of the Revolving
Credit Loans as reflected on the Revolving Credit Note Records from time to time
shall be considered prima facie evidence of such outstanding amount.
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5.5. INABILITY TO DETERMINE LIBOR RATE. In the event, prior to the
commencement of any Interest Period relating to any LIBOR Rate Loan, the Agent
shall determine or be notified by the Majority Banks that (a) the Agent or the
Majority Banks have determined that adequate and reasonable methods do not exist
for ascertaining the LIBOR Rate that would otherwise determine the rate of
interest to be applicable to any LIBOR Rate Loan during any Interest Period,
determined or to be determined for such Interest Period will not adequately and
fairly reflect the cost to at least the Majority Banks of making or maintaining
their LIBOR Rate Loans during such period, the Agent shall forthwith give notice
of such determination (which shall be conclusive and binding on the Borrower and
the Banks) to the Borrower and the Banks. In such event (a) any Loan Request or
Conversion Request with respect to LIBOR Rate Loans shall be automatically
withdrawn and, shall be deemed a request for Base Rate Loans, (b) each LIBOR
Rate Loan will automatically, on the last day of the then current Interest
Period relating thereto, become a Base Rate Loan, and (c) the obligations of the
Banks to make LIBOR Rate Loans shall be suspended until the Agent or the
Majority Banks determine that the circumstances giving rise to such suspension
no longer exist, whereupon the Agent or, as the case may be, the Agent upon the
instruction of the Majority Banks, shall so notify the Borrower and the Banks.
5.6. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Bank to make or maintain
LIBOR Rate Loans, such Bank shall forthwith give notice of such circumstances to
the Borrower and the other Banks and thereupon (a) the commitment of such Bank
to make LIBOR Rate Loans or convert Loans of another Type to LIBOR Rate Loans
shall forthwith be suspended and (b) such Bank's Revolving Credit Loans then
outstanding as LIBOR Rate Loans shall be converted automatically to Base Rate
Loans on the last day of each Interest Period applicable to such LIBOR Rate
Loans or within such earlier period as may be required by law. The Borrower
hereby agrees promptly to pay the Agent for the account of such Bank, upon
demand by such Bank, any additional amounts necessary to compensate such Bank
for any costs actually incurred by such Bank in making any conversion in
accordance with this (S)5.6, including any interest or fees payable by such Bank
to lenders of funds obtained by it in order to make or maintain its LIBOR Rate
Loans hereunder.
5.7 ADDITIONAL COSTS, ETC. If any present or future applicable law, which
expression, as used herein, includes statutes, rules and regulations thereunder
and interpretations thereof by any competent court with proper jurisdiction or
by any governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to this
Credit Agreement, the other Loan Documents, any Letters of Credit, such
Bank's Commitment or the Revolving Credit Loans (other than taxes based
upon or measured by the income or profits of such Bank or the Agent), or
(b) materially change the basis of taxation (except for changes in
taxes on income or profits) of payments to any Bank of the principal of or
the interest on any Loans or any other amounts payable to any Bank or the
Agent under this Credit Agreement or any of the other Loan Documents, or
37
(c) impose or increase or render applicable (other than to the extent
specifically provided for elsewhere in this Credit Agreement) any special
deposit, reserve, assessment, liquidity, capital adequacy or other similar
requirements (whether or not having the force of law) against assets held
by, or deposits in or for the account of, or loans by, or letters of credit
issued by, or commitments of an office of any Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan
Documents, any Letters of Credit, the Revolving Credit Loans, such Bank's
Commitment, or any class of loans, letters of credit or commitments of
which any of the Revolving Credit Loans or such Bank's Commitment forms a
part, and the result of any of the foregoing is
(i) to increase the cost to any Bank of making, funding,
issuing, renewing, extending or maintaining any of the Revolving
Credit Loans or such Bank's Commitment or any Letter of Credit, or
(ii) to reduce the amount of principal, interest, Reimbursement
Obligation or other amount payable to such Bank or the Agent hereunder
on account of such Bank's Commitment, any Letter of Credit or any of
the Loans, or
(iii) to require such Bank or the Agent to make any payment or
to forego any interest or Reimbursement Obligation or other sum
payable hereunder, the amount of which payment or foregone interest or
Reimbursement Obligation or other sum is calculated by reference to
the gross amount of any sum receivable or deemed received by such Bank
or the Agent from the Borrower hereunder,
then, and in each such case, the Borrower will, upon demand made by such Bank or
(as the case may be) the Agent at any time and from time to time and as often as
the occasion therefor may arise, pay to such Bank or the Agent such additional
amounts as will be sufficient to compensate such Bank or the Agent for such
additional cost, reduction, payment or foregone interest or Reimbursement
Obligation or other sum provided that the Borrower shall not be liable to any
Bank or the Agent for costs incurred more than ninety (90) days prior to receipt
by the Borrower of such demand for payment from such Bank or, as the case may
be, the Agent, unless such costs were incurred prior to such ninety (90) day
period as a result of such present or future applicable law being retroactive to
a date which occurred prior to such ninety (90) day period and such Bank or, as
the case may be, the Agent, has given notice to the Borrower of the
effectiveness of such law within ninety (90) days after the effective date
thereof.
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5.8. CAPITAL ADEQUACY. If after the date hereof any Bank or the Agent
determines that (a) the adoption of or change in any law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) regarding capital requirements for banks or bank holding companies or any
change in the interpretation or application thereof by a court or governmental
authority with appropriate jurisdiction, or (b) compliance by such Bank or the
Agent or any corporation controlling such Bank or the Agent with any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) of any such entity regarding capital adequacy, has the
effect of reducing the return on such Bank's or the Agent's commitment with
respect to any Revolving Credit Loans to a level below that which such Bank or
the Agent could have achieved but for such adoption, change or compliance
(taking into consideration such Bank's or the Agent's then existing policies
with respect to capital adequacy and assuming full utilization of such entity's
capital) by any amount deemed by such Bank or (as the case may be) the Agent to
be material, then such Bank or the Agent may notify the Borrower of such fact.
To the extent that the amount of such reduction in the return on capital is not
reflected in the Base Rate, the Borrower and such Bank shall thereafter attempt
to negotiate in good faith, within thirty (30) days of the day on which the
Borrower receives such notice, an adjustment payable hereunder that will
adequately compensate such Bank in light of these circumstances. If the Borrower
and such Bank are unable to agree to such adjustment within thirty (30) days of
the date on which the Borrower receives such notice, then commencing on the date
of such notice (but not earlier than the effective date of any such increased
capital requirement), the fees payable hereunder shall increase by an amount
that will, in such Bank's reasonable determination, provide adequate
compensation provided that the Borrower shall not be liable to any Bank or the
Agent for costs incurred more than ninety (90) days prior to receipt by the
Borrower of the notice referred to in the immediately preceding sentence from
such Bank or the Agent, as the case may be. Each Bank shall allocate such cost
increases among its customers in good faith and on an equitable basis.
5.9. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to (S)(S)5.7 or 5.8 and a brief explanation of such amounts
which are due, submitted by any Bank or the Agent to the Borrower, shall be
conclusive, absent manifest error, that such amounts are due and owing.
5.10. INDEMNITY. The Borrower agrees to indemnify each Bank and to hold
each Bank harmless from and against any loss, cost or reasonable expense that
such Bank may sustain or incur as a consequence of (a) default by the Borrower
in payment of the principal amount of or any interest on any LIBOR Rate Loans as
and when due and payable, including any such loss or expense arising from
interest or fees payable by such Bank to lenders of funds obtained by it in
order to maintain its LIBOR Rate Loans, (b) default by the Borrower in making a
borrowing or conversion after the Borrower has given (or is deemed to have
given) a Loan Request or a Conversion Request relating thereto in accordance
with (S)2.6 or (S)2.7 or (c) the making of any payment of a LIBOR Rate Loan or
the making of any conversion of any such LIBOR Rate Loan to a Base Rate Loan on
a day that is not the last day of the applicable Interest Period with respect
thereto, including interest or fees payable by such Bank to lenders of funds
obtained by it in order to maintain any such Revolving Credit Loans.
39
5.11. INTEREST AFTER DEFAULT.
5.11.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Revolving Credit Loans and all
other overdue amounts payable hereunder or under any of the other Loan Documents
shall, upon the occurrence of an Event of Default resulting from any such
failure to pay, bear interest compounded monthly and payable on demand at a rate
per annum equal to two percent (2%) above the rate otherwise applicable to such
Revolving Credit Loans pursuant to (S)2.5 until such amount shall be paid in
full (after as well as before judgment).
5.11.2. AMOUNTS NOT OVERDUE. During the continuance of an Event of
Default the principal of the Revolving Credit Loans not overdue shall, until
such Event of Default has been cured or remedied or such Event of Default has
been waived by the Majority Banks pursuant to (S)25, bear interest at a rate per
annum equal to two percent (2%) above the rate of interest otherwise applicable
to such Revolving Credit Loans pursuant to (S)2.5.
5.12. REPLACEMENT OF BANKS. Within thirty (30) days after (a) the Borrower
is required to make a deduction or withholding for the account of, or any
payment of any additional amount to, any Non-U.S. Bank pursuant to (S)5.3.2
hereof in respect of United States withholding tax; (b) any Bank had demanded
compensation from the Borrower pursuant to (S)(S)5.7 or 5.8 hereof, or (c) there
shall have occurred a change in law with respect to any Bank as a consequence of
which it shall have become unlawful for such Bank to make a LIBOR Rate Loan on
any Drawdown Date, as described in (S)5.6 hereof (any such Bank described in the
foregoing clauses (a)- (c) is hereinafter referred to as an "Affected Bank"),
the Borrower may request that the other Banks (collectively, the "Non-Affected
Banks") acquire all, but not less than all, of the Affected Bank's Commitment or
may designate a replacement bank or banks, which must be an Eligible Assignee
and which also must be reasonably acceptable to the Agent, to acquire and assume
all or any portion of the outstanding Revolving Credit Loans and Commitment of
the Affected Bank (the "Replacement Bank"). If the Borrower so requests the Non-
Affected Banks to acquire all or a portion of the Affected Bank's Commitment,
the Non-Affected Banks may elect to acquire all or any portion of the Affected
Banks outstanding Revolving Credit Loans and to assume all or any portion of the
Affected Bank's Commitment. In addition, the Replacement Bank may acquire and
assume that portion of the outstanding Revolving Credit Loans and Commitments of
the Affected Bank not otherwise acquired or assumed by the Non-Affected Banks
(provided, the Borrower shall have no obligation to offer any portion of the
outstanding Revolving Credit Loans and Commitments of the Affected Bank to the
Non-Affected Banks prior to making any offer to a Replacement Bank). The
provisions of (S)18 hereof shall apply to all reallocations pursuant to this
(S)5.12, and the Affected Bank and any Non-Affected Banks and/or replacement
banks which are to acquire the Revolving Credit Loans and Commitment of the
Affected Bank
40
shall execute and deliver to the Agent, in accordance with the provisions of
(S)18 hereof, such Assignments and Acceptances and other instruments, including,
without limitation, the Revolving Credit Notes, as are required pursuant to
(S)18 hereof to give effect to such reallocations. On the effective date of the
applicable Assignment and Acceptance, the Borrower shall pay to the Affected
Bank all interest accrued on its Revolving Credit Loans up to but excluding such
date, along with any fees payable to such Affected Bank hereunder up to but
excluding such date.
5.13. RESERVE REQUIREMENT. For any day that a LIBOR Rate Loan is
outstanding, the Borrower shall pay an amount (the "Reserve Charge") equal to
the product of (a) the outstanding principal amount of the LIBOR Rate Loan,
times (b) the remainder of (i) a fraction, the numerator of which is the LIBOR
Rate and the denominator of which is one minus the Eurocurrency Reserve Rate,
minus (ii) the LIBOR Rate times (c) the fraction, the numerator of which is one
and the denominator of which is three hundred and sixty (360). If any Bank is
not required to maintain any such reserves, the Eurocurrency Reserve Rate
applicable to such Bank shall be zero. Reserve Charges for each Interest Period
shall be paid on the applicable Interest Payment Date to the Agent for the
Account of each Bank entitled to receive such Reserve Charge.
6. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Banks and the Agent as follows:
6.1 CORPORATE AUTHORITY.
6.1.1. INCORPORATION; GOOD STANDING. Each of the Borrower and its
Subsidiaries (a) is a corporation duly organized, validly existing and in good
standing under the laws of its state of incorporation, (b) has all requisite
corporate power to own its property and conduct its business as now conducted
and as presently contemplated, and (c) is in good standing as a foreign
corporation and is duly authorized to do business in each jurisdiction where
such qualification is necessary except where a failure to be so qualified would
not have a Material Adverse Effect.
6.1.2. AUTHORIZATION. The execution, delivery and performance of this
Credit Agreement and the other Loan Documents to which the Borrower or any of
its Subsidiaries is or is to become a party and the transactions contemplated
hereby and thereby (a) are within the corporate authority of such Person, (b)
have been duly authorized by all necessary corporate proceedings, (c) do not
conflict with or result in any breach or contravention of any provision of law,
statute, rule or regulation to which the Borrower or any of its Subsidiaries is
subject or any judgment, order, writ, injunction, license or permit applicable
to the Borrower or any of its Subsidiaries and (d) do not conflict with any
provision of the corporate charter or bylaws of, or any agreement or other
instrument binding upon, the Borrower or any of its Subsidiaries unless the
conflict to any agreement (other than the corporate charter or bylaws) could not
reasonably be expected to have a Material Adverse Effect.
41
6.1.3. ENFORCEABILITY. The execution and delivery of this Credit
Agreement and the other Loan Documents to which the Borrower or any of its
Subsidiaries is or is to become a party will result in valid and legally binding
obligations of such Person enforceable against it in accordance with the
respective terms and provisions hereof and thereof, except as enforceability is
limited by bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting generally the enforcement of creditors' rights and
except to the extent that availability of the remedy of specific performance or
injunctive relief is subject to the discretion of the court before which any
proceeding therefor may be brought.
6.2. GOVERNMENTAL APPROVALS. The execution, delivery and performance by the
Borrower and any of its Subsidiaries of this Credit Agreement and the other Loan
Documents to which the Borrower or any of its Subsidiaries is or is to become a
party and the transactions contemplated hereby and thereby do not require the
approval or consent of, or filing with, any governmental agency or authority
other than those already obtained.
6.3. TITLE TO PROPERTIES; LEASES. The Borrower and its Subsidiaries own
all of the assets reflected in the consolidated balance sheet of the Borrower
and its Subsidiaries as at the Balance Sheet Date or acquired since that date
(except property and assets sold or otherwise disposed of in the ordinary course
of business since that date), subject to no rights of others, including any
mortgages, leases, conditional sales agreements, title retention agreements,
liens or other encumbrances except Permitted Liens.
6.4 FINANCIAL STATEMENTS, PROJECTIONS AND SOLVENCY.
6.4.1. FISCAL YEAR. The Borrower and each of its Subsidiaries has a
fiscal year which is the twelve months ending on about September 30 of each
calendar year.
6.4.2. FINANCIAL STATEMENTS. There has been furnished to each of the
Banks a consolidated balance sheet of the Borrower and its Subsidiaries as at
the Balance Sheet Date, and a consolidated statement of income of the Borrower
and its Subsidiaries for the fiscal year then ended, certified by
PricewaterhouseCoopers LLP. Such balance sheet and statement of income have been
prepared in accordance with Generally Accepted Accounting Principles and fairly
present the financial condition of the Borrower as at the close of business on
the date thereof and the results of operations for the fiscal year then ended.
There are no contingent liabilities of the Borrower or any of its Subsidiaries
as of such date involving material amounts, known to the officers of the
Borrower, which were not disclosed in such balance sheet and the notes related
thereto.
42
6.4.3. PROJECTIONS. The projections of the annual operating budgets of
the Borrower and its Subsidiaries on a consolidated basis, balance sheets and
cash flow statements for the 2000 to 2002 fiscal years, copies of which have
been delivered to each Bank, disclose all assumptions made with respect to
general economic, financial and market conditions used in formulating such
projections. To the knowledge of the Borrower or any of its Subsidiaries, no
facts exist that (individually or in the aggregate) would result in any material
change in any of such projections. The projections are based upon reasonable
estimates and assumptions, have been prepared on the basis of the assumptions
stated therein and reflect the reasonable estimates of the Borrower and its
Subsidiaries of the results of operations and other information projected
therein.
6.4.4. SOLVENCY. The Borrower represents and warrants to the Agent and
the Banks that the Borrower, and the Borrower and its Subsidiaries on a
consolidated basis, both before and after giving effect to the transactions
contemplated by this Credit Agreement and the other Loan Documents (a) are
solvent, (b) have assets having a fair value in excess of their liabilities, (c)
have assets having a fair value in excess of the amount required to pay their
liabilities on existing debts as such debts become absolute and matured, and (d)
have, and expect to continue to have, access to adequate capital for the conduct
of their business and the ability to pay their debts from time to time incurred
in connection with the operation of their business as such debts mature.
6.5. NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date there has
occurred no materially adverse change in the financial condition or business of
the Borrower and its Subsidiaries as shown on or reflected in the consolidated
balance sheet of the Borrower and its Subsidiaries as at the Balance Sheet Date,
or the consolidated statement of income for the fiscal year then ended, other
than changes in the ordinary course of business that have not had any materially
adverse effect either individually or in the aggregate on the business or
financial condition of the Borrower or any of its Subsidiaries. Since the
Balance Sheet Date, the Borrower has not made any Distributions.
6.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each of the Borrower and its
Subsidiaries possesses all franchises, patents, copyrights, trademarks, trade
names, licenses and permits, and rights in respect of the foregoing, adequate
for the conduct of its business substantially as now conducted without known
conflict with any rights of others.
6.7. LITIGATION. Except as set forth in Schedule 6.7 hereto, there are no
actions, suits, proceedings or investigations of any kind pending or threatened
against the Borrower or any of its Subsidiaries before any court, tribunal or
administrative agency or board that, if adversely determined, might, either in
any case or in the aggregate, materially adversely affect the properties,
assets, financial condition or business of the Borrower and its Subsidiaries or
materially impair the right of the Borrower and its Subsidiaries, considered as
a whole, to carry on business substantially as now conducted by them, or result
in any substantial liability not adequately covered by insurance, or for which
adequate reserves are not maintained on the consolidated balance sheet of the
Borrower and its Subsidiaries, or which question the validity of this Credit
Agreement or any of the other Loan Documents, or any action taken or to be taken
pursuant hereto or thereto.
43
6.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. Neither the Borrower nor any of
its Subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation that has or is
expected in the future to have a materially adverse effect on the business,
assets or financial condition of the Borrower or any of its Subsidiaries.
Neither the Borrower nor any of its Subsidiaries is a party to any contract or
agreement that has or is expected, in the judgment of the Borrower's officers,
to have any Material Adverse Effect.
6.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the Borrower nor
any of its Subsidiaries is in violation of any provision of its charter
documents, bylaws, or any agreement or instrument to which it may be subject or
by which it or any of its properties may be bound or any decree, order,
judgment, statute, license, rule or regulation, in any of the foregoing cases in
a manner that could result in the imposition of substantial penalties have a
Material Adverse Effect.
6.10. TAX STATUS. The Borrower and its Subsidiaries (a) have made or filed
all federal and state income and all other tax returns, reports and declarations
required by any jurisdiction to which any of them is subject, (b) have paid all
taxes and other governmental assessments and charges shown or determined to be
due on such returns, reports and declarations, except those being contested in
good faith and by appropriate proceedings and (c) have set aside on their books
provisions reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Borrower know of no basis
for any such claim.
6.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred and
is continuing.
6.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. Neither the Borrower nor
any of its Subsidiaries is a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter" of
an "investment company", as such terms are defined in the Investment Company Act
of 1940.
6.13. ABSENCE OF FINANCING STATEMENTS, ETC. Except with respect to
Permitted Liens, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office, that purports to cover, affect
or give notice of any present or possible future lien on, or security interest
in, any assets or property of the Borrower or any of its Subsidiaries or any
rights relating thereto.
6.14. INSURANCE. The Borrower and each of its Subsidiaries maintains with
financially sound and reputable insurers insurance with respect to its
properties and businesses against such casualties and contingencies as are in
accordance with sound business practices and with the details of such coverage
being more fully described on Schedule 6.14 hereto.
44
6.15. CERTAIN TRANSACTIONS. Except as set forth in Schedule 6.15 hereto and
except for arm's length transactions pursuant to which the Borrower or any of
its Subsidiaries makes payments in the ordinary course of business upon terms no
less favorable than the Borrower or such Subsidiary could obtain from third
parties, none of the officers, directors, or employees of the Borrower or any of
its Subsidiaries is presently a party to any transaction with the Borrower or
any of its Subsidiaries (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for
the furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of the Borrower, any corporation,
partnership, trust or other entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner.
6.16. EMPLOYEE BENEFIT PLANS.
6.16.1. IN GENERAL. Each Employee Benefit Plan and each Guaranteed
Pension Plan has been maintained and operated in compliance in all material
respects with the provisions of ERISA and, to the extent applicable, the Code,
including but not limited to the provisions thereunder respecting prohibited
transactions and the bonding of fiduciaries and other persons handling plan
funds as required by (S)412 of ERISA. The Borrower has heretofore delivered to
the Agent the most recently completed annual report, Form 5500, with all
required attachments, and actuarial statement required to be submitted under
(S)103(d) of ERISA, with respect to each Guaranteed Pension Plan.
6.16.2. TERMINABILITY OF WELFARE PLANS. No Employee Benefit Plan,
which is an employee welfare benefit plan within the meaning of (S)3(1) or
(S)3(2)(B) of ERISA, provides benefit coverage subsequent to termination of
employment, except as required by Title I, Part 6 of ERISA or the applicable
state insurance laws. The Borrower may terminate each such Plan at any time (or
at any time subsequent to the expiration of any applicable bargaining agreement)
in the discretion of the Borrower without liability to any Person other than for
claims arising prior to termination.
6.16.3. GUARANTEED PENSION PLANS. Each contribution required to be
made to a Guaranteed Pension Plan, whether required to be made to avoid the
incurrence of an accumulated funding deficiency, the notice or lien provisions
of (S)302(f) of ERISA, or otherwise, has been timely made. No waiver of an
accumulated funding deficiency or extension of amortization periods has been
received with respect to any Guaranteed Pension Plan, and neither the Borrower
nor any ERISA Affiliate is obligated to or has posted security in connection
with an amendment to a Guaranteed Pension Plan pursuant to (S)307 of ERISA or
(S)401(a)(29) of the Code. No liability to the PBGC (other than required
insurance premiums, all of which have been paid) has been incurred by the
Borrower or
45
any ERISA Affiliate with respect to any Guaranteed Pension Plan and there has
not been any ERISA Reportable Event (other than an ERISA Reportable Event as to
which the requirement of 30 days notice has been waived), or any other event or
condition which presents a material risk of termination of any Guaranteed
Pension Plan by the PBGC. Based on the latest valuation of each Guaranteed
Pension Plan (which in each case occurred within twelve months of the date of
this representation), and on the actuarial methods and assumptions employed for
that valuation, the aggregate benefit liabilities of all such Guaranteed Pension
Plans within the meaning of (S)4001 of ERISA did not exceed the aggregate value
of the assets of all such Guaranteed Pension Plans, disregarding for this
purpose the benefit liabilities and assets of any Guaranteed Pension Plan with
assets in excess of benefit liabilities.
6.16.4. MULTIEMPLOYER PLANS. Neither the Borrower nor any ERISA
Affiliate has incurred any material liability (including secondary liability) to
any Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan under (S)4201 of ERISA or as a result of a sale of assets
described in (S)4204 of ERISA. Neither the Borrower nor any ERISA Affiliate has
been notified that any Multiemployer Plan is in reorganization or insolvent
under and within the meaning of (S)4241 or (S)4245 of ERISA or is at risk of
entering reorganization or becoming insolvent, or that any Multiemployer Plan
intends to terminate or has been terminated under (S)4041A of ERISA.
6.17. USE OF PROCEEDS.
6.17.1. GENERAL. The proceeds of the Revolving Credit Loans shall be
used for working capital and general corporate purposes (including, without
limitation, to finance all or any portion of a Permitted Acquisition). The
Borrower will obtain Letters of Credit solely for working capital and general
corporate purposes.
6.17.2. REGULATIONS U AND X. No portion of any Revolving Credit Loan
is to be used, and no portion of any Letter of Credit is to be obtained, for the
purpose of purchasing or carrying any "margin security" or "margin stock" as
such terms are used in Regulations U and X of the Board of Governors of the
Federal Reserve System, 12 C.F.R. Parts 221 and 224.
6.17.3. INELIGIBLE SECURITIES. No portion of the proceeds of any
Revolving Credit Loans is to be used, and no portion of any Letter of Credit is
to be obtained, for the purpose of knowingly purchasing, or providing credit
support for the purchase of, during the underwriting or placement period or
within 30 days thereafter, any Ineligible Securities underwritten or privately
placed by a Section 20 Subsidiary.
46
6.18 ENVIRONMENTAL COMPLIANCE. The Borrower has taken all necessary steps
to investigate the past and present condition and usage of the Real Estate and
the operations conducted thereon and, based upon such diligent investigation,
has determined that:
(a) none of the Borrower, its Subsidiaries or any operator of the Real
Estate or any operations thereon is in violation, or alleged violation, of
any judgment, decree, order, law, license, rule or regulation pertaining to
environmental matters, including without limitation, those arising under
the Resource Conservation and Recovery Act ("RCRA"), the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 as amended
("CERCLA"), the Superfund Amendments and Reauthorization Act of 1986
("▇▇▇▇"), the Federal Clean Water Act, the Federal Clean Air Act, the Toxic
Substances Control Act, or any state or local statute, regulation,
ordinance, order or decree relating to health, safety or the environment
(hereinafter "Environmental Laws"), which violation would have a material
adverse effect on the environment or a Material Adverse Effect;
(b) neither the Borrower nor any of its Subsidiaries has received
notice from any third party including, without limitation, any federal,
state or local governmental authority (other than any notice the content of
which could not reasonably be expected to have a Material Adverse Effect),
(i) that any one of them has been identified by the United States
Environmental Protection Agency ("EPA") as a potentially responsible party
under CERCLA with respect to a site listed on the National Priorities List,
40 C.F.R. Part ▇▇▇ ▇▇▇▇▇▇▇▇ ▇; (ii) that any hazardous waste, as defined by
42 U.S.C. (S)6903(5), any hazardous substances as defined by 42 U.S.C.
(S)9601(14), any pollutant or contaminant as defined by 42 U.S.C.
(S)9601(33) and any toxic substances, oil or hazardous materials or other
chemicals or substances regulated by any Environmental Laws ("Hazardous
Substances") which any one of them has generated, transported or disposed
of has been found at any site at which a federal, state or local agency or
other third party has conducted or has ordered that any Borrower or any of
its Subsidiaries conduct a remedial investigation, removal or other
response action pursuant to any Environmental Law; or (iii) that it is or
shall be a named party to any claim, action, cause of action, complaint, or
legal or administrative proceeding (in each case, contingent or otherwise)
arising out of any third party's incurrence of costs, expenses, losses or
damages of any kind whatsoever in connection with the release of Hazardous
Substances;
(c) except as set forth on Schedule 6.18 attached hereto and except
where the failure to comply with any of the provisions of this (S)6.18(c)
could not reasonably be expected to have a Material Adverse Effect: (i) no
portion of the Real Estate has been used for the handling, processing,
storage or disposal of Hazardous Substances except in accordance with
applicable Environmental Laws; and no underground tank or other underground
storage receptacle for Hazardous Substances is located on any portion of
the Real Estate; (ii) in the course of any activities conducted by the
Borrower, its Subsidiaries or operators of its properties, no Hazardous
Substances have been generated or are being
47
used on the Real Estate except in accordance with applicable Environmental
Laws; (iii) there have been no releases (i.e. any past or present
releasing, spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, disposing or dumping) or threatened
releases of Hazardous Substances on, upon, into or from the properties of
the Borrower or its Subsidiaries, which releases would have a material
adverse effect on the value of any of the Real Estate or adjacent
properties or the environment; (iv) to the best of the Borrower's
knowledge, there have been no releases on, upon, from or into any real
property in the vicinity of any of the Real Estate which, through soil or
groundwater contamination, may have come to be located on, and which would
have a material adverse effect on the value of, the Real Estate; and (v) in
addition, any Hazardous Substances that have been generated on any of the
Real Estate have been transported offsite only by carriers having an
identification number issued by the EPA, treated or disposed of only by
treatment or disposal facilities maintaining valid permits as required
under applicable Environmental Laws, which transporters and facilities have
been and are, to the best of the Borrower's knowledge, operating in
compliance with such permits and applicable Environmental Laws;
(d) None of the Borrower and its Subsidiaries or any of the other Real
Estate is subject to any applicable environmental law requiring the
performance of Hazardous Substances site assessments, or the removal or
remediation of Hazardous Substances, or the giving of notice to any
governmental agency or the recording or delivery to other Persons of an
environmental disclosure document or statement by virtue of the
transactions set forth herein and contemplated hereby, or as a condition to
the effectiveness of any other transactions contemplated hereby.
6.19. SUBSIDIARIES, ETC. Schedule 6.19(a) sets forth the Subsidiaries of
the Borrower. Except as set forth on Schedule 6.19(b) hereto, neither the
Borrower nor any Subsidiary of the Borrower is engaged in any joint venture or
partnership with any other Person.
6.20. CHIEF EXECUTIVE OFFICE. The Borrower's chief executive office is at
▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, at which location its books and
records are kept.
6.21. DISCLOSURE. None of this Credit Agreement or any of the other Loan
Documents contains any untrue statement of a material fact or omits to state a
material fact (known to the Borrower or any of its Subsidiaries in the case of
any document or information not furnished by it or any of its Subsidiaries)
necessary in order to make the statements herein or therein not misleading. As
of the Closing Date, there is no fact known to the Borrower or any of its
Subsidiaries which materially adversely affects, or which is reasonably likely
in the future to materially adversely affect, the business, assets, financial
condition or prospects of the Borrower or any of its Subsidiaries, exclusive of
effects resulting from changes in general economic conditions, legal standards
or regulatory conditions.
48
6.22. CAPITALIZATION DOCUMENTS. The Borrower has delivered to the Agent
true and complete copies of all of the Capitalization Documents and, as of the
Closing Date the Borrower has not amended any such documents in any material
respects, except as may have been disclosed to and consented to by the Agent.
6.23. STATUS OF LOAN AS SENIOR DEBT. From and after such time as the
Borrower has incurred or assumed any Subordinated Debt, all Indebtedness of the
Borrower and its Subsidiaries to the Banks and the Agent in respect of the
Revolving Credit Loans and the Reimbursement Obligations constitutes "Superior
Indebtedness", "Senior Indebtedness" or "Senior Debt" (or the analogous term
used therein) under the terms of the Subordinated Debt Documents or any other
instrument evidencing or pursuant to which there is issued Indebtedness which
purports to be Subordinated Debt of the Borrower or any Subsidiary.
6.24. NO OTHER DESIGNATED SENIOR DEBT. From and after such time as the
Borrower has incurred or assumed any Subordinated Debt, the Borrower has not
designated any Indebtedness of the Borrower or any of its Subsidiaries as, and
has no, "designated senior debt" (or any analogous term used in the Subordinated
Debt Documents which describes any creditor which is entitled to send any
blockage or similar notice to the Borrower or the holders of the Subordinated
Debt under the subordination provisions thereof) for purposes of the
Subordinated Debt, other than the Obligations.
7. AFFIRMATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Revolving Credit
Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is outstanding
or any Bank has any obligation to make any Revolving Credit Loans or the Agent
has any obligation to issue, extend or renew any Letters of Credit:
7.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or cause
to be paid the principal and interest on the Revolving Credit Loans, all
Reimbursement Obligations, the Letter of Credit Fees, the Revolver A Commitment
Fees, the Revolver B Commitment Fees, the Agent's fee and all other amounts
provided for in this Credit Agreement and the other Loan Documents to which the
Borrower or any of its Subsidiaries is a party, all in accordance with the terms
of this Credit Agreement and such other Loan Documents.
7.2. MAINTENANCE OF OFFICE. The Borrower will maintain its chief executive
office in ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ or at such other place in the
United States of America as the Borrower shall designate upon written notice to
the Agent, where notices, presentations and demands to or upon the Borrower in
respect of the Loan Documents to which the Borrower is a party may be given or
made.
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7.3. RECORDS AND ACCOUNTS. The Borrower will (a) keep, and cause each of
its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will be made in accordance with Generally
Accepted Accounting Principles, (b) maintain adequate accounts and reserves for
all taxes (including income taxes), depreciation, depletion, obsolescence and
amortization of its properties and the properties of its Subsidiaries,
contingencies, and other reserves, and (c) at all times engage
PricewaterhouseCoopers LLP or other independent certified public accountants
reasonably satisfactory to the Agent as the independent certified public
accountants of the Borrower and its Subsidiaries and will not permit more than
thirty (30) days to elapse between the cessation of such firm's (or any
successor firm's) engagement as the independent certified public accountants of
the Borrower and its Subsidiaries and the appointment in such capacity of a
successor firm as shall be reasonably satisfactory to the Agent.
7.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower will
deliver to each of the Banks:
(a) as soon as practicable, but in any event not later than ninety
(90) days after the end of each fiscal year of the Borrower, the
consolidated balance sheet of the Borrower and its Subsidiaries and the
consolidating balance sheet of the Borrower and its Subsidiaries, each as
at the end of such year, and the related consolidated statement of income
and consolidated statement of cash flow and consolidating statement of
income and consolidating statement of cash flow for such year, each setting
forth in comparative form the figures for the previous fiscal year and all
such consolidated and consolidating statements to be in reasonable detail,
prepared in accordance with Generally Accepted Accounting Principles, and
such consolidated statements to be certified without qualification by
PricewaterhouseCoopers LLP or by other independent certified public
accountants reasonably satisfactory to the Agent, together with a written
statement from such accountants to the effect that they have read a copy of
this Credit Agreement, and that, in making the examination necessary to
said certification, they have obtained no knowledge of any Default or Event
of Default, or, if such accountants shall have obtained knowledge of any
then existing Default or Event of Default they shall disclose in such
statement any such Default or Event of Default; provided that such
accountants shall not be liable to the Banks for failure to obtain
knowledge of any Default or Event of Default;
(b) as soon as practicable, but in any event not later than forty-five
(45) days after the end of each of the fiscal quarters of the Borrower,
copies of the unaudited consolidated balance sheet of the Borrower and its
Subsidiaries and the unaudited consolidating balance sheet of the Borrower
and its Subsidiaries, each as at the end of such quarter, and the related
consolidated statement of income and consolidated statement of cash flow
and consolidating statement of income and consolidating statement of cash
flow for the portion of the Borrower's fiscal year then elapsed, all in
reasonable detail and prepared in accordance with Generally Accepted
Accounting Principles, together with a certification by the principal
financial or accounting officer of the Borrower that the information
contained in such financial statements fairly presents the financial
position of the Borrower and its Subsidiaries on the date thereof (subject
to year-end adjustments);
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(c) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by the
principal financial or accounting officer of the Borrower in substantially
the form of Exhibit D hereto (the "Compliance Certificate") and setting
forth in reasonable detail computations evidencing compliance with the
covenants contained in (S)10 and (if applicable) reconciliations to reflect
changes in Generally Accepted Accounting Principles since the Balance Sheet
Date;
(d) contemporaneously with the filing or mailing thereof, copies of
all material of a financial nature filed with the Securities and Exchange
Commission or sent to the stockholders of the Borrower;
(e) within fifteen (15) days after the end of each calendar month or
at such earlier time as the Agent may reasonably request, a Borrowing Base
Report setting forth the Borrowing Base as at the end of such calendar
month or other date so requested by the Agent;
(f) upon the request of the Agent, an Accounts Receivable aging
report;
(g) as soon as practicable, but in any event not later than January 31
of each year, annual projections of the Borrower and its Subsidiaries (such
projections to include, without limitation, the balance sheet, income
statement and cash flow statement of the Borrower and its Subsidiaries on a
quarterly basis); and
(h) from time to time such other financial data and information
(including accountants, management letters) as the Agent or any Bank may
reasonably request.
7.5. NOTICES.
7.5.1. DEFAULTS. The Borrower will promptly notify the Agent and each
of the Banks in writing of the occurrence of any Default or Event of Default. If
any Person shall give any notice or take any other action in respect of a
claimed default (whether or not constituting an Event of Default) under this
Credit Agreement or any other note, evidence of indebtedness, indenture or other
obligation in an amount in excess of $5,000,000 to which or with respect to
which the Borrower or any of its Subsidiaries is a party or obligor, whether as
principal, guarantor, surety or otherwise, the Borrower shall forthwith give
written notice thereof to the Agent and each of the Banks, describing the notice
or action and the nature of the claimed default.
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7.5.2. ENVIRONMENTAL EVENTS. The Borrower will promptly give notice to
the Agent and each of the Banks (a) of any violation of any Environmental Law
that the Borrower or any of its Subsidiaries reports in writing or is reportable
by such Person in writing (or for which any written report supplemental to any
oral report is made) to any federal, state or local environmental agency and (b)
upon becoming aware thereof, of any inquiry, proceeding, investigation, or other
action, including a notice from any agency of potential environmental liability,
of any federal, state or local environmental agency or board, that has the
potential to have a Material Adverse Effect.
7.5.3. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will, and will
cause each of its Subsidiaries to, give notice to the Agent and each of the
Banks in writing within fifteen (15) days of becoming aware of any litigation or
proceedings threatened in writing or any pending litigation and proceedings
affecting the Borrower or any of its Subsidiaries or to which the Borrower or
any of its Subsidiaries is or becomes a party involving an uninsured claim
against the Borrower or any of its Subsidiaries that could reasonably be
expected to have a materially adverse effect on the Borrower or any of its
Subsidiaries and stating the nature and status of such litigation or
proceedings. The Borrower will, and will cause each of its Subsidiaries to, give
notice to the Agent and each of the Banks, in writing, in form and detail
satisfactory to the Agent, within ten (10) days of any judgment not covered by
insurance, final or otherwise, against the Borrower or any of its Subsidiaries
in an amount in excess of $10,000,000.
7.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. The Borrower will do
or cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence, rights and franchises and those of its
Subsidiaries and will not, and will not cause or permit any of its Subsidiaries
to, convert to a limited liability company. It (a) will cause all of its
properties and those of its Subsidiaries used or useful in the conduct of its
business or the business of its Subsidiaries to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment,
(b) will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of the Borrower may
be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times, and (c) will, and will cause
each of its Subsidiaries to, continue to engage primarily in the businesses now
conducted by them and in related businesses; provided that nothing in this
(S)7.6 shall prevent the Borrower from discontinuing the operation and
maintenance of any of its properties or any of those of its Subsidiaries if such
discontinuance is, in the judgment of the Borrower, desirable in the conduct of
its or their business and that do not in the aggregate materially adversely
affect the business of the Borrower and its Subsidiaries on a consolidated
basis.
7.7. INSURANCE. The Borrower will, and will cause each of its Subsidiaries
to, maintain with financially sound and reputable insurers insurance with
respect to its properties and business against such casualties and contingencies
as shall be in accordance with the general practices of businesses engaged in
similar activities in similar geographic areas and in amounts, containing such
terms, in such forms and for such periods as may be reasonable and prudent.
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7.8. TAXES. The Borrower will, and will cause each of its Subsidiaries to,
duly pay and discharge, or cause to be paid and discharged, before the same
shall become overdue, all taxes, assessments and other governmental charges
imposed upon it and its real properties, sales and activities, or any part
thereof, or upon the income or profits therefrom, as well as all claims for
labor, materials, or supplies that if unpaid might by law become a lien or
charge upon any of its property; provided that any such tax, assessment, charge,
levy or claim need not be paid if the validity or amount thereof shall currently
be contested in good faith by appropriate proceedings and if the Borrower or
such Subsidiary shall have set aside on its books adequate reserves with respect
thereto; and provided further that the Borrower and each Subsidiary of the
Borrower will pay all such taxes, assessments, charges, levies or claims
forthwith upon the commencement of proceedings to foreclose any lien that may
have attached as security therefor.
7.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
7.9.1. GENERAL. No more frequently than once during each calendar
year, or more frequently as determined by the Agent if an Event of Default shall
have occurred and be continuing, upon the request of the Agent, the Borrower
shall permit the Banks, through the Agent or any of the Banks' other designated
representatives, to visit and inspect any of the properties of the Borrower or
any of its Subsidiaries, to examine the books of account of the Borrower and its
Subsidiaries (and to make copies thereof and extracts therefrom), and to discuss
the affairs, finances and accounts of the Borrower and its Subsidiaries with,
and to be advised as to the same by, its and their officers, all at such
reasonable times and intervals as the Agent or any Bank may reasonably request.
Unless a Default or Event of Default has occurred and is continuing, such visit
and inspection shall be at the expense of the Banks. If any Default or Event of
Default has occurred and is continuing, all such expenses shall be for the
account of the Borrower. The Agent may, at the Borrower's expense, participate
in or observe any physical count of inventory included in the Borrowing Base.
7.9.2. AUDITOR REPORTS. If an Event of Default shall have occurred and
be continuing, upon the request of the Agent, the Borrower will obtain and
deliver to the Agent, or, if the Agent so elects, will cooperate with the Agent
in the Agent's obtaining, a report of an independent auditor satisfactory to the
Agent (which may be affiliated with one of the Banks) with respect to the
Accounts Receivable and inventory components included in the Borrowing Base,
which report shall indicate whether or not the information set forth in the
Borrowing Base most recently delivered is accurate and complete in all material
respects based upon a review by such auditors of the Accounts Receivable
(including verification with respect to the amount, aging, identity and credit
of the respective account debtors and the billing practices of the Borrower or
its applicable Subsidiary) and inventory (including verification as to the
value, location and respective types). All such asset value reports shall be
conducted and made at the expense of the Borrower.
7.9.3. APPRAISALS. If an Event of Default shall have occurred and be
continuing, upon the request of the Agent, the Borrower will obtain and deliver
to the Agent appraisal reports in form and substance and from appraisers
satisfactory to the Agent, stating (a) the then current fair market, orderly
liquidation and forced liquidation values of all or any portion of the equipment
or real estate owned by the Borrower or any of its Subsidiaries and (b) the then
current business value of each of the Borrower and its Subsidiaries. All such
appraisals shall be conducted and made at the expense of the Borrower.
53
7.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The Borrower
will, and will cause each of its Subsidiaries to, comply with (a) the applicable
laws and regulations wherever its business is conducted, including all
Environmental Laws except where the failure to so comply could not reasonably be
expected to have a Material Adverse Effect, (b) the provisions of its charter
documents and by-laws, (c) all agreements and instruments by which it or any of
its properties may be bound except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect and (d) all applicable
decrees, orders, and judgments except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect. If any authorization,
consent, approval, permit or license from any officer, agency or instrumentality
of any government shall become necessary or required in order that the Borrower
or any of its Subsidiaries may fulfill any of its obligations hereunder or any
of the other Loan Documents to which the Borrower or such Subsidiary is a party,
the Borrower will, or (as the case may be) will cause such Subsidiary to,
immediately take or cause to be taken all reasonable steps within the power of
the Borrower or such Subsidiary to obtain such authorization, consent, approval,
permit or license and furnish the Agent and the Banks with evidence thereof.
7.11. EMPLOYEE BENEFIT PLANS. The Borrower will (a) promptly upon filing
the same with the Department of Labor or Internal Revenue Service, furnish to
the Agent a copy of the most recent actuarial statement required to be submitted
under (S)103(d) of ERISA and Annual Report, Form 5500, with all required
attachments, in respect of each Guaranteed Pension Plan and (b) promptly upon
receipt or dispatch, furnish to the Agent any notice, report or demand sent or
received in respect of a Guaranteed Pension Plan under (S)(S)302, 4041, 4042,
4043, 4063, 4065, 4066 and 4068 of ERISA, or in respect of a Multiemployer Plan,
under (S)(S)4041A, 4202, 4219, 4242, or 4245 of ERISA.
7.12. USE OF PROCEEDS. The Borrower will use the proceeds of the Revolving
Credit Loans solely for working capital and general corporate purposes
(including, without limitation, financing all or any portion of a Permitted
Acquisition). The Borrower will obtain Letters of Credit solely for working
capital and general corporate purposes.
7.13. ADDITIONAL SUBSIDIARIES. If, after the Closing Date, the Borrower or
any of its Subsidiaries creates or acquires, either directly or indirectly, any
Subsidiary, it will immediately notify the Agent of such creation or
acquisition, as the case may be, and provide the Agent with an updated Schedule
6.19(a).
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7.14. SUBORDINATED GUARANTEES. From and after the time the Borrower has
incurred or assumed any Subordinated Debt, the Borrower will promptly advise the
Agent of any guarantee required to be entered into in connection with any
provision of the Subordinated Debt Documents, and identifying the guarantor
thereunder. In addition, simultaneously with entering into such guarantee, the
Borrower shall cause such Subsidiary to execute and deliver to the Agent and the
Banks a guaranty of the Obligations hereunder and such other documents as the
Agent may require (including, without limitation, legal opinions relating
thereto), each in form and substance satisfactory to the Agent.
7.15. SATISFACTION OF EXAMINATION. The Agent shall have received, by not
later than forty-five (45) days after the Closing Date, the results of its due
diligence examination as to the Borrower's financial conditions that the Agent
deems necessary or advisable, with such results of such examinations being in
form and substance satisfactory to the Agent. The cost and expense of all such
examinations pursuant to this (S)7.15 shall be for the Borrower's account.
7.16. FURTHER ASSURANCES. The Borrower will, and will cause each of its
Subsidiaries to, cooperate with the Banks and the Agent and execute such further
instruments and documents as the Banks or the Agent shall reasonably request to
carry out to their satisfaction the transactions contemplated by this Credit
Agreement and the other Loan Documents.
8. CERTAIN NEGATIVE COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Revolving Credit
Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is outstanding
or any Bank has any obligation to make any Revolving Credit Loans or the Agent
has any obligations to issue, extend or renew any Letters of Credit:
8.1. RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and will not
permit any of its Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness other
than:
(a) Indebtedness to the Banks and the Agent arising under any of the
Loan Documents;
(b) endorsements for collection, deposit or negotiation and warranties
of products or services, in each case incurred in the ordinary course of
business;
(c) Indebtedness incurred in connection with the acquisition after the
date hereof of any real or personal property by the Borrower or such
Subsidiary or under any Capitalized Lease or Synthetic Lease, provided that
the aggregate principal amount of such Indebtedness of the Borrower and its
Subsidiaries shall not exceed the aggregate amount of $5,000,000 at any one
time;
55
(d) Indebtedness existing on the date hereof and listed and described
on Schedule 8.1 hereto and any renewals, extensions and refinancings
thereof so long as any such renewal, extension or refinancing (i) does not
increase the principal amount of such Indebtedness; (ii) does not increase
the rate of interest thereon; (iii) does not shorten the maturity of any
such Indebtedness; and (iv) does not impose any terms, conditions,
covenants or defaults which are more onerous to the Borrower than the terms
of the Indebtedness being renewed, extended or refinanced;
(e) Subordinated Debt evidenced by the Subordinated Debt Documents in
an aggregate principal amount of not more than $200,000,000;
(f) Indebtedness of a Subsidiary of the Borrower to any other Person
other than the Borrower, provided that the aggregate principal amount of
all such Indebtedness under this (S)8.1(f) does not exceed $15,000,000
outstanding at any time;
(g) Indebtedness of Varian Japan to any Person other than the Borrower
arising out of the sale by Varian Japan to such Person of accounts for
money due or to become due or other receivables of Varian Japan or any
similar transaction, provided that the aggregate principal amount of all
such Indebtedness under this (S)8.1(g) does not exceed $20,000,000
outstanding at any time;
(h) Indebtedness of the Borrower in an aggregate amount of not more
than $20,000,000 evidencing the Borrower's commitment to make an Investment
in First Silicon located in Sarawak, Malaysia;
(i) Indebtedness of a Subsidiary of the Borrower to the Borrower
provided (i) no Default or Event of Default has occurred and is continuing
hereunder or would exist as a result thereof; (ii) such Indebtedness is not
outstanding after the first anniversary of the Closing Date hereunder;
(iii) such Indebtedness is in the form of intercompany loans evidenced by a
written promissory note, with a maturity of not longer than 120 days from
the date such Indebtedness is incurred; (iv) for a period of thirty (30)
consecutive days in the twelve months following the Closing Date, there are
no outstanding amounts owing from any Subsidiary to the Borrower under this
(S)8.1(i); and (v) the aggregate principal amount of all such Indebtedness
under this (S)8.1(i) does not exceed $5,000,000 outstanding at any time;
provided, however, notwithstanding the foregoing provision of this
(S)8.1, all Indebtedness hereunder must qualify as "Debt" or "Indebtedness"
(or any analogous term used in the Subordinated Debt Documents) permitted
to be incurred pursuant to the Subordinated Debt Documents.
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8.2. RESTRICTIONS ON LIENS. The Borrower will not, and will not permit any
of its Subsidiaries to, (a) create or incur or suffer to be created or incurred
or to exist any lien, encumbrance, mortgage, pledge, charge, restriction or
other security interest of any kind upon any of its property or assets of any
character whether now owned or hereafter acquired, or upon the income or profits
therefrom; (b) transfer any of such property or assets or the income or profits
therefrom for the purpose of subjecting the same to the payment of Indebtedness
or performance of any other obligation in priority to payment of its general
creditors; (c) acquire, or agree or have an option to acquire, any property or
assets upon conditional sale or other title retention or purchase money security
agreement, device or arrangement; (d) suffer to exist for a period of more than
thirty (30) days after the same shall have been incurred any Indebtedness or
claim or demand against it that if unpaid might by law or upon bankruptcy or
insolvency, or otherwise, be given any priority whatsoever over its general
creditors; or (e) sell, assign, pledge or otherwise transfer any "receivables"
as defined in clause (g) of the definition of the term "Indebtedness," with or
without recourse; provided that the Borrower or any of its Subsidiaries may
create or incur or suffer to be created or incurred or to exist:
(i) liens in favor of the Borrower on all or part of the assets of
Subsidiaries of the Borrower securing Indebtedness owing by Subsidiaries of
the Borrower to the Borrower to the extent permitted by (S)8.1(i);
(ii) liens to secure taxes, assessments and other government charges
in respect of obligations not overdue or liens on properties to secure
claims for labor, material or supplies in respect of obligations not
overdue;
(iii) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(iv) liens on properties in respect of judgments or awards that have
been in force for less than the applicable period for taking an appeal so
long as execution is not levied thereunder or in respect of which the
Borrower or such Subsidiary shall at the time in good faith be prosecuting
an appeal or proceedings for review and in respect of which a stay of
execution shall have been obtained pending such appeal or review;
(v) liens of carriers, warehousemen, mechanics and materialmen, and
other like liens on properties in existence less than 120 days from the
date of creation thereof in respect of obligations not overdue;
(vi) encumbrances on Real Estate consisting of easements, rights of
way, zoning restrictions, restrictions on the use of real property and
defects and irregularities in the title thereto, landlord's or lessor's
liens under leases to which the Borrower or a Subsidiary of the Borrower is
a party, and other minor liens or encumbrances none of which in the opinion
of the Borrower interferes materially with the use of the property affected
in the ordinary conduct of the business of the Borrower and its
Subsidiaries, which defects do not individually or in the aggregate have a
materially adverse effect on the business of the Borrower individually or
of the Borrower and its Subsidiaries on a consolidated basis;
57
(vii) liens existing on the date hereof and listed on Schedule 8.2
hereto and liens existing in accordance with the provisions of (S)8.1(d)
securing permitted renewals, extensions and refinancings of the
Indebtedness provided for therein;
(viii) liens on the assets of Varian Japan to secure the Indebtedness
permitted by (S)8.1(g) hereof; and
(ix) purchase money security interests in or purchase money
mortgages on real or personal property acquired after the date hereof to
secure purchase money Indebtedness of the type and amount permitted by
(S)8.1(c), incurred in connection with the acquisition of such property,
which security interests or mortgages cover only the real or personal
property so acquired and liens in favor of lessors under Capitalized Leases
or Synthetic Leases on assets subject to Capitalized Leases or Synthetic
Leases permitted by (S)8.1(c) hereof.
8.3. RESTRICTIONS ON INVESTMENTS. The Borrower will not, and will not
permit any of its Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United States
of America that mature within one (1) year from the date of purchase by the
Borrower;
(b) demand deposits, certificates of deposit, bankers acceptances and
time deposits of United States banks having total assets in excess of
$1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated
and the ratings for which are not less than "P 1" if rated by ▇▇▇▇▇'▇
Investors Service, Inc., and not less than "A 1" if rated by Standard and
Poor's Rating Group;
(d) Investments existing on the date hereof and listed on Schedule 8.3
hereto;
(e) Investments made in connection with the Borrower's Investment
Policy Guidelines, provided, notwithstanding such Investment Policy
Guidelines, the Borrower shall not be permitted to make any Investment in
any Subsidiary;
(f) the Investment by the Borrower in First Silicon in an aggregate
amount not to exceed $20,000,000; and
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(g) Investments by the Borrower in a Subsidiary in an aggregate amount
not to exceed $5,000,000 outstanding at any time with respect to the
Indebtedness permitted by (S)8.1(i) so long as all the conditions set forth
in (S)8.1(i) have been satisfied.
8.4. RESTRICTED PAYMENTS. Neither the Borrower nor any of its Subsidiaries
will make any Restricted Payments; provided, however, (a) any Subsidiary of the
Borrower shall be permitted to make a Restricted Payment to the Borrower and,
(b) so long as no Default or Event of Default has occurred and is continuing or
would exist as a result thereof, the Borrower shall be permitted to make
repurchases of its capital stock in the open market so long as (i) the
consideration paid by the Borrower for such capital stock is not greater than
the fair market value of such stock at the time of such repurchase; and (ii) the
aggregate amount of the consideration paid by the Borrower for all such
repurchases does not exceed the lesser of (1) $10,000,000 in any fiscal year and
(2) five percent (5%) of the Borrower's Consolidated Tangible Net Worth for the
immediately preceding fiscal year.
8.5. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
8.5.1. MERGERS AND ACQUISITIONS. Borrower will not, and will not
permit any of its Subsidiaries to, become a party to any merger or
consolidation, or agree to or effect any asset acquisition or stock acquisition
(other than the acquisition of assets in the ordinary course of business
consistent with past practices) except (a) the merger or consolidation of one or
more of the Subsidiaries of the Borrower with and into the Borrower; (b) the
merger or consolidation of two or more Subsidiaries of the Borrower; and (c) any
merger or asset or stock acquisition by the Borrower or any of its Subsidiaries
of Persons in the same or similar line of business as the Borrower (a "Permitted
Acquisition") where (1) the Borrower has provided the Agent and the Banks with
written notice of such Permitted Acquisition, which notice shall include a
reasonably detailed description of such Permitted Acquisition; (2) the business
to be acquired would not subject the Agent or the Banks to any additional
regulatory or third party approvals in connection with the exercise of its
rights and remedies under this Credit Agreement or any other Loan Document; (3)
no contingent liabilities will be incurred or assumed in connection with such
Permitted Acquisition which could reasonably be expected to have a material
adverse effect on the business, assets or financial condition of the Borrower or
any Subsidiary, and any Indebtedness incurred or assumed in connection with such
Permitted Acquisition shall have been permitted to be incurred or assumed
pursuant to (S)8.1 hereof; (4) the Borrower has provided Banks and the Agent
with such other information as was reasonably requested by the Banks and the
Agent; (5) after the consummation of the Permitted Acquisition, to the extent
such acquisition was a stock acquisition, the Person so acquired is merged with
and into the Borrower or its Subsidiary, with the Borrower or such Subsidiary,
as the case may be, being the survivor of such merger; (6) the Borrower has
demonstrated to the satisfaction of the Agent and the Majority Banks, based on a
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pro forma Compliance Certificate, compliance with (S)9 hereof immediately prior
to and immediately after giving effect to such Permitted Acquisition; (7) the
aggregate amount of the purchase price for all Permitted Acquisitions (or series
of related acquisitions) shall not exceed $50,000,000 in any fiscal year and
shall not exceed $150,000,000 over the life of this Credit Agreement; (8) the
board of directors and the shareholders (if required by applicable law), or the
equivalent, of each of the Borrower and the Person to be acquired has approved
such merger, consolidation or acquisition and such Permitted Acquisition is
otherwise considered "friendly"; and (9) the Borrower has delivered to the Agent
and the Banks a certificate of the chief financial officer of the Borrower to
the effect that (A) the Borrower and its Subsidiaries, on a consolidated and
consolidating basis, will be solvent upon the consummation of the Permitted
Acquisition; (B) the pro forma Compliance Certificate fairly presents the
financial condition of the Borrower and its Subsidiaries as of the date thereof
and after giving effect to such Permitted Acquisition; and (C) no Default or
Event of Default then exists or would result after giving effect to the
Permitted Acquisition.
8.5.2. DISPOSITION OF ASSETS. The Borrower will not, and will not
permit any of its Subsidiaries to, become a party to or agree to or effect any
disposition of assets, other than (a) the sale of inventory, the licensing of
intellectual property and the disposition of obsolete assets, in each case in
the ordinary course of business consistent with past practices; and (b) so long
as no Default or Event of Default has occurred and is continuing or would exist
as a result thereof, the disposition of assets with a fair market value of not
more than $10,000,000 in any fiscal year.
Notwithstanding anything to the contrary contained in this (S)8.5.2., the
Borrower and its Subsidiaries shall not be permitted to dispose of any assets or
take (or omit to take) any action in connection with any asset sale or other
disposition or engage in any other transaction which action (or omission) would
require any repayment, repurchase or redemption (or any mandatory offer to
repay, repurchase or redeem) by the Borrower or any of its Subsidiaries of the
Subordinated Debt prior to the repayment in full in cash of all the Obligations
and the termination of the Total Commitment to zero, or would violate the
provisions of any of the Subordinated Debt Documents.
8.6. SALE AND LEASEBACK. Except as permitted by (S)8.5.2., the Borrower
will not, and will not permit any of its Subsidiaries to, enter into any
arrangement, directly or indirectly, whereby the Borrower or any Subsidiary of
the Borrower shall sell or transfer any property owned by it in order then or
thereafter to lease such property or lease other property that the Borrower or
any Subsidiary of the Borrower intends to use for substantially the same purpose
as the property being sold or transferred.
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8.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrower will not, and will
not permit any of its Subsidiaries to, (a) use any of the Real Estate or any
portion thereof for the handling, processing, storage or disposal of Hazardous
Substances, (b) cause or permit to be located on any of the Real Estate any
underground tank or other underground storage receptacle for Hazardous
Substances, (c) generate any Hazardous Substances on any of the Real Estate, (d)
conduct any activity at any Real Estate or use any Real Estate in any manner so
as to cause a release (i.e. releasing, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, disposing or
dumping) or threatened release of Hazardous Substances on, upon or into the Real
Estate or (e) otherwise conduct any activity at any Real Estate or use any Real
Estate in any manner that would violate any Environmental Law or bring such Real
Estate in violation of any Environmental Law, except if any of the foregoing
could not reasonably be expected to have a Material Adverse Effect.
8.8. EMPLOYEE BENEFIT PLANS. Neither the Borrower nor any ERISA Affiliate
will
(a) engage in any "prohibited transaction" within the meaning of
(S)406 of ERISA or (S)4975 of the Code which could result in a material
liability for the Borrower or any of its Subsidiaries; or
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in (S)302 of ERISA, whether or
not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an extent
which, or terminate any Guaranteed Pension Plan in a manner which, could
result in the imposition of a lien or encumbrance on the assets of the
Borrower or any of its Subsidiaries pursuant to (S)302(f) or (S)4068 of
ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances requiring the
posting of security pursuant to (S)307 of ERISA or (S)401(a)(29) of the
Code; or
(e) permit or take any action which would result in the aggregate
benefit liabilities (with the meaning of (S)4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, disregarding for this purpose the benefit liabilities and
assets of any such Plan with assets in excess of benefit liabilities.
8.9. BUSINESS ACTIVITIES. The Borrower will not, and will not permit any of
its Subsidiaries to, engage directly or indirectly (whether through Subsidiaries
or otherwise) in any type of business other than the businesses conducted by
them on the Closing Date and in a similar or related businesses (including,
without limitation, the semiconductor capital equipment business).
8.10. FISCAL YEAR. The Borrower will not, and will not permit any of it
Subsidiaries to, change the date of the end of its fiscal year from that set
forth in (S)6.4.1.
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8.11. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will not
permit any of its Subsidiaries to, engage in any transaction with any Affiliate
(other than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any such Affiliate or, to the
knowledge of the Borrower, any corporation, partnership, trust or other entity
in which any such Affiliate has a substantial interest or is an officer,
director, trustee or partner, on terms more favorable to such Person than would
have been obtainable on an arm's-length basis in the ordinary course of
business.
8.12. UPSTREAM LIMITATIONS. The Borrower will not, and will not permit any
of its Subsidiaries to, enter into any agreement, contract or arrangement (other
than the Credit Agreement and the other Loan Documents) restricting the ability
of any Subsidiary to pay or make dividends or distributions in cash or kind to
the Borrower, to make loans, advances or other payments of whatsoever nature to
the Borrower, or to make transfer or distributions of all or any part of its
assets to the Borrower.
8.13. INCONSISTENT AGREEMENTS. The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any agreement containing any provision
which would be violated or breached by the performance by the Borrower or any of
its Subsidiaries of their respective obligations hereunder or under any of the
Loan Documents.
8.14. MODIFICATION OF DOCUMENTS AND CHARTER DOCUMENTS. The Borrower will
not, nor will it permit any of its Subsidiaries to, consent to or agree to any
amendment, supplement or other modification to the Capitalization Documents
without the prior written consent of the Agent (which consent will not be
unreasonably withheld) unless such amendment, supplement or modification would
not have any material adverse effect on the Agent's or the Bank's rights under
the Loan Documents or the Borrower's or any of its Subsidiaries' obligations
under the Loan Documents.
8.15. SUBORDINATED DEBT. The Borrower will not, and will not permit any of
its Subsidiaries to, amend, supplement or otherwise modify the terms of any of
the Subordinated Debt or prepay, redeem or repurchase any of the Subordinated
Debt or send any notice of redemption, prepayment, repurchase or defeasance with
respect to any of the Subordinated Debt.
8.16. SENIOR DEBT. The Borrower and its Subsidiaries will not in any manner
designate or permit to exist any other Indebtedness of the Borrower or any of
its Subsidiaries as "designated senior debt" (or any analogous term used in the
Subordinated Debt Documents which describes any creditor which is entitled to
send any blockage or similar notice to the Borrower or the holders of the
Subordinated Debt under the subordination provisions thereof) for purposes of
the Subordinated Debt, other than the Indebtedness arising under the Loan
Documents.
9. FINANCIAL COVENANTS OF THE BORROWER.
The Borrower covenants and agrees that, so long as any Revolving Credit
Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is outstanding
or any Bank has any obligation to make any Revolving Credit Loans or the Agent
has any obligation to issue, extend or renew any Letters of Credit:
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9.1. LEVERAGE RATIO. The Borrower will not permit the Leverage Ratio as at
the end of any fiscal quarter to exceed (a) 2.50:1.00 from the Closing Date
through the fiscal quarter ending December 31, 2000; and (b) 2.25:1.00 at the
end of any fiscal quarter ending thereafter.
9.2. FIXED CHARGE COVERAGE RATIO. The Borrower will not permit the Fixed
Charge Coverage Ratio as at the end of any fiscal quarter to be less than
1.50:1.00.
9.3. QUICK RATIO. The Borrower will not permit the ratio of Consolidated
Current Assets to Consolidated Current Liabilities to be less than 1.00:1.00 at
any time.
9.4. PROFITABLE OPERATIONS. The Borrower will not permit (a) Consolidated
Net Operating Income for any two consecutive fiscal quarters to be less than
$1.00 and (b) Consolidated Net Operating Deficit for any fiscal quarter to
exceed ten percent (10%) of Consolidated Tangible Net Worth for such fiscal
quarter.
9.5. CAPITAL EXPENDITURES. The Borrower will not make, or permit any
Subsidiary of the Borrower to make, Capital Expenditures in any fiscal year that
exceed, in the aggregate, (a) $28,000,000 for the fiscal year ending December
31, 2000; and (b) $15,000,000 for such fiscal year ending thereafter; provided,
however, that if during any fiscal year ending on or after December 31, 2001 the
aggregate amount of Capital Expenditures permitted for that fiscal year is not
so utilized, such unutilized amount may be utilized in the next succeeding year
but not in any subsequent fiscal year.
10. CLOSING CONDITIONS.
The obligations of the Banks to make the initial Revolving Credit Loans and
of the Agent to issue any initial Letters of Credit shall be subject to the
satisfaction of the following conditions precedent:
10.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to each of the Banks.
Each Bank shall have received a fully executed copy of each such document.
10.2. CERTIFIED COPIES OF CHARTER DOCUMENTS. Each of the Banks shall have
received from the Borrower a copy, certified by a duly authorized officer of
such Person to be true and complete on the Closing Date, of each of (a) its
charter or other incorporation documents as in effect on such date of
certification, and (b) its by-laws as in effect on such date.
10.3. CORPORATE ACTION. All corporate action necessary for the valid
execution, delivery and performance by the Borrower of this Credit Agreement and
the other Loan Documents to which it is or is to become a party shall have been
duly and effectively taken, and evidence thereof satisfactory to the Banks shall
have been provided to each of the Banks.
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10.4. INCUMBENCY CERTIFICATE. Each of the Banks shall have received from
the Borrower an incumbency certificate, dated as of the Closing Date, signed by
a duly authorized officer of the Borrower, and giving the name and bearing a
specimen signature of each individual who shall be authorized: (a) to sign, in
the name and on behalf of each of the Borrower, each of the Loan Documents to
which the Borrower is or is to become a party; (b) to make Loan Requests and
Conversion Requests and to apply for Letters of Credit; and (c) to give notices
and to take other action on its behalf under the Loan Documents.
10.5. UCC SEARCH RESULTS. The Agent shall have received from each of the
Borrower and its Subsidiaries the results of UCC searches, indicating no liens
other than Permitted Liens and otherwise in form and substance satisfactory to
the Agent.
10.6. CERTIFICATES OF INSURANCE. The Agent shall have received a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, identifying insurers, types of insurance, insurance limits, and
policy terms.
10.7. BORROWING BASE REPORT. The Agent shall have received from the
Borrower the initial Borrowing Base Report dated as of the Closing Date.
10.8. ACCOUNTS RECEIVABLE AGING REPORT. The Agent shall have received from
the Borrower the most recent Accounts Receivable aging report of the Borrower
and its Subsidiaries dated as of a date which shall be no more than forty-five
(45) days prior to the Closing Date and the Borrower shall have notified the
Agent in writing on the Closing Date of any material deviation from the Accounts
Receivable values reflected in such Accounts Receivable aging report and shall
have provided the Agent with such supplementary documentation as the Agent may
reasonably request.
10.9. OPINION OF COUNSEL. Each of the Banks and the Agent shall have
received a favorable legal opinion addressed to the Banks and the Agent, dated
as of the Closing Date, in form and substance satisfactory to the Banks and the
Agent, from ▇▇▇▇ and ▇▇▇▇ LLP, counsel to the Borrower and its Subsidiaries.
10.10. PAYMENT OF FEES. The Borrower shall have paid to the Banks or the
Agent, as appropriate, the fees pursuant to (S)5.1 and (S)5.2 hereof.
11. CONDITIONS TO ALL BORROWINGS.
The obligations of the Banks to make any Revolving Credit Loan and of the
Agent to issue, extend or renew any Letter of Credit, in each case whether on or
after the Closing Date, shall also be subject to the satisfaction of the
following conditions precedent:
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11.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of any of the Borrower and its Subsidiaries
contained in this Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection with this Credit Agreement
shall be true as of the date as of which they were made and shall also be true
at and as of the time of the making of such Loan or the issuance, extension or
renewal of such Letter of Credit, with the same effect as if made at and as of
that time (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing.
11.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Bank would make it illegal for such Bank to make such Revolving Credit
Loan or to participate in the issuance, extension or renewal of such Letter of
Credit or in the reasonable opinion of the Agent would make it illegal for the
Agent to issue, extend or renew such Letter of Credit.
11.3. GOVERNMENTAL REGULATION. Each Bank shall have received such
statements in substance and form reasonably satisfactory to such Bank as such
Bank shall require for the purpose of compliance with any applicable regulations
of the Comptroller of the Currency or the Board of Governors of the Federal
Reserve System.
11.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents and
all other documents incident thereto shall be reasonably satisfactory in
substance and in form to the Banks and to the Agent and the Agent's Special
Counsel.
11.5. BORROWING BASE REPORT. The Agent shall have received the most recent
Borrowing Base Report required to be delivered to the Agent in accordance with
(S)7.4(e).
12. EVENTS OF DEFAULT; ACCELERATION; ETC.
12.1 EVENTS OF DEFAULT AND ACCELERATION. If any of the following events
("Events of Default" or, if the giving of notice or the lapse of time or both is
required, then, prior to such notice or lapse of time, "Defaults") shall occur:
(a) the Borrower shall fail to pay any principal of the Revolving
Credit Loans or any Reimbursement Obligation when the same shall become due
and payable, whether at the stated date of maturity or any accelerated date
of maturity or at any other date fixed for payment;
(b) the Borrower shall fail to pay any interest on the Revolving
Credit Loans, the Revolver A Commitment Fee, the Revolver B Commitment Fee,
any Letter of Credit Fee, the Agent's fee, or other sums due hereunder or
under any of the other Loan Documents within three (3) Business Days after
the same shall become due and payable, whether at the stated date of
maturity or any accelerated date of maturity or at any other date fixed for
payment;
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(c) the Borrower shall fail to comply with any of its covenants
contained in (S)7.1-7.5, 7.8-7.9, 7.11-7.16, 8 or 9;
(d) the Borrower or any of its Subsidiaries shall fail to perform any
term, covenant or agreement contained herein or in any of the other Loan
Documents (other than those specified elsewhere in this (S)12.1) for thirty
(30) days after written notice of such failure has been given to the
Borrower by the Agent;
(e) any representation or warranty of the Borrower or any of its
Subsidiaries in this Credit Agreement or any of the other Loan Documents or
in any other document or instrument delivered pursuant to or in connection
with this Credit Agreement shall prove to have been false in any material
respect upon the date when made or deemed to have been made or repeated;
(f) the Borrower or any of its Subsidiaries shall fail to pay at
maturity, or within any applicable period of grace, any obligation for
borrowed money or credit received or in respect of any Capitalized Leases
or Synthetic Leases, in an amount in excess of $10,000,000, or any
Subordinated Debt, or fail to observe or perform any material term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money or credit received or in respect of
any Capitalized Leases or Synthetic Leases, in an amount in excess of
$10,000,000, or any Subordinated Debt, for such period of time as would
permit (assuming the giving of appropriate notice if required) the holder
or holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof, or any such holder or holders shall rescind or shall
have a right to rescind the purchase of any such obligations;
(g) the Borrower or any of its Subsidiaries (other than a Deminimis
Subsidiary) shall make an assignment for the benefit of creditors, or admit
in writing its inability to pay or generally fail to pay its debts as they
mature or become due, or shall petition or apply for the appointment of a
trustee or other custodian, liquidator or receiver of the Borrower or any
of its Subsidiaries (other than a Deminimis Subsidiary) or of any
substantial part of the assets of the Borrower or any of its Subsidiaries
(other than a Deminimis Subsidiary) or shall commence any case or other
proceeding relating to the Borrower or any of its Subsidiaries under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation or similar law of any jurisdiction, now or
hereafter in effect, or shall take any action to authorize or in
furtherance of any of the foregoing, or if any such petition or application
shall be filed or any such case or other proceeding shall be commenced
against the Borrower or any of its Subsidiaries (other than a Deminimis
Subsidiary) and the Borrower or any of its Subsidiaries (other than a
Deminimis Subsidiary) shall indicate its approval thereof, consent thereto
or acquiescence therein or such petition or application shall not have been
dismissed within ninety (90) days following the filing thereof;
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(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating the Borrower or any of
its Subsidiaries (other than a Deminimis Subsidiary) bankrupt or insolvent,
or approving a petition in any such case or other proceeding, or a decree
or order for relief is entered in respect of the Borrower or any Subsidiary
of the Borrower (other than a Deminimis Subsidiary) in an involuntary case
under federal bankruptcy laws as now or hereafter constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty days, whether or not consecutive, any final
judgment against the Borrower or any of its Subsidiaries that, with other
outstanding final judgments, undischarged, against the Borrower or any of
its Subsidiaries exceeds in the aggregate $10,000,000;
(j) if any of the Loan Documents shall be cancelled, terminated,
revoked or rescinded otherwise than in accordance with the terms thereof or
with the express prior written agreement, consent or approval of the Banks,
or any action at law, suit or in equity or other legal proceeding to
cancel, revoke or rescind any of the Loan Documents shall be commenced by
or on behalf of the Borrower or any of its Subsidiaries party thereto or
any of their respective stockholders, or any court or any other
governmental or regulatory authority or agency of competent jurisdiction
shall make a determination that, or issue a judgment, order, decree or
ruling to the effect that, any one or more of the Loan Documents is
illegal, invalid or unenforceable in accordance with the terms thereof;
(k) the Borrower or any ERISA Affiliate incurs any liability to the
PBGC or a Guaranteed Pension Plan pursuant to Title IV of ERISA in an
aggregate amount exceeding $500,000, or the Borrower or any ERISA Affiliate
is assessed withdrawal liability pursuant to Title IV of ERISA by a
Multiemployer Plan requiring aggregate annual payments exceeding $500,000,
or any of the following occurs with respect to a Guaranteed Pension Plan:
(i) an ERISA Reportable Event, or a failure to make a required installment
or other payment (within the meaning of (S)302(f)(1) of ERISA), provided
that the Agent determines in its reasonable discretion that such event (A)
could be expected to result in liability of the Borrower or any of its
Subsidiaries to the PBGC or such Guaranteed Pension Plan in an aggregate
amount exceeding $500,000 and (B) could constitute grounds for the
termination of such Guaranteed Pension Plan by the PBGC, for the
appointment by the appropriate United States District Court of a trustee to
administer such Guaranteed Pension Plan or for the imposition of a lien in
favor of such Guaranteed Pension Plan; or (ii) the appointment by a United
States District Court of a trustee to administer such Guaranteed Pension
Plan; or (iii) the institution by the PBGC of proceedings to terminate such
Guaranteed Pension Plan;
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(l) the Borrower or any of its Subsidiaries shall be enjoined,
restrained or in any way prevented by the order of any court or any
administrative or regulatory agency from conducting any material part of
its business and such order shall continue in effect for more than thirty
(30) days;
(m) any strike, lockout, labor dispute, embargo, condemnation, act of
God or public enemy, or other casualty, which in any such case causes, for
more than fifteen (15) consecutive days, the cessation or substantial
curtailment of revenue producing activities at any facility of the Borrower
or any of its Subsidiaries if such event or circumstance is not covered by
business interruption insurance and would have a Material Adverse Effect;
(n) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired by
the Borrower or any of its Subsidiaries if such loss, suspension,
revocation or failure to renew would have a Material Adverse Effect;
(o) the holders of all or any part of the Subordinated Debt shall
accelerate the maturity of all or any part of the Subordinated Debt or the
Subordinated Debt shall be (or shall be required at such time to be)
prepaid, redeemed or repurchased in whole or in part, or the Borrower shall
be or become required under the Subordinated Debt Documents to prepay,
redeem or repurchase (or shall be or become required thereunder to offer to
prepay, redeem or repurchase) all or any part of the Subordinated Debt;
(p) the Borrower shall at any time, legally or beneficially own less
than 80% of the capital stock of any Subsidiary;
(q) a "Change of Control" (or the analogous term used therein) as
defined in any of the Subordinated Debt Documents occurs, or any person or
group of persons (within the meaning of Section 13 or 14 of the Securities
Exchange Act of 1934, as amended) shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 promulgated by the Securities and
Exchange Commission under said Act) of 20% or more of the outstanding
shares of common stock of the Borrower; or, during any period of twelve
consecutive calendar months, individuals who were directors of the Borrower
on the first day of such period shall cease to constitute a majority of the
board of directors of the Borrower (except to the extent that individuals
who at the beginning of such twelve month period were replaced by
individuals elected by a majority of the remaining members of the board of
directors of the Borrower or nominated for election by a majority of the
remaining members of the board of directors of the Borrower);
then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing to
the Borrower declare all amounts owing with respect to this Credit Agreement,
the Notes and the other Loan Documents and all Reimbursement Obligations to be,
and they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower; provided that in the event of any Event
of Default specified in (S)(S)12.1(g) or 12.1(h), all such amounts shall become
immediately due and payable automatically and without any requirement of notice
from the Agent or any Bank.
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12.2. TERMINATION OF COMMITMENTS. If any one or more of the Events of
Default specified in (S)12.1(g) or (S)12.1(h) shall occur, any unused portion of
the credit hereunder shall forthwith terminate and each of the Banks shall be
relieved of all further obligations to make Revolving Credit Loans to the
Borrower and the Agent shall be relieved of all further obligations to issue,
extend or renew Letters of Credit. If any other Event of Default shall have
occurred and be continuing, the Agent may and, upon the request of the Majority
Banks, shall, by notice to the Borrower, terminate the unused portion of the
credit hereunder, and upon such notice being given such unused portion of the
credit hereunder shall terminate immediately and each of the Banks shall be
relieved of all further obligations to make Revolving Credit Loans and the Agent
shall be relieved of all further obligations to issue, extend or renew Letters
of Credit. No termination of the credit hereunder shall relieve the Borrower or
any of its Subsidiaries of any of the Obligations.
12.3. REMEDIES. In case any one or more of the Events of Default shall have
occurred and be continuing, and whether or not the Banks shall have accelerated
the maturity of the Loans pursuant to (S)12.1, each Bank, if owed any amount
with respect to the Revolving Credit Loans or the Reimbursement Obligations,
may, with the consent of the Majority Banks but not otherwise, proceed to
protect and enforce its rights by suit in equity, action at law or other
appropriate proceeding, whether for the specific performance of any covenant or
agreement contained in this Credit Agreement and the other Loan Documents or any
instrument pursuant to which the Obligations to such Bank are evidenced,
including as permitted by applicable law the obtaining of the ex parte
appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Bank. No remedy herein conferred upon any Bank
or the Agent or the holder of any Note or purchaser of any Letter of Credit
Participation is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of law.
12.4. DISTRIBUTION OF PROCEEDS. In the event that, following the occurrence
or during the continuance of any Default or Event of Default, the Agent or any
Bank, as the case may be, receives any monies in connection with the enforcement
of its rights hereunder or under any of the other Loan Documents, such monies
shall be distributed for application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Agent for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agent in connection with the collection of such monies by
the Agent, for the exercise, protection or enforcement by the Agent of all
or any of the rights, remedies, powers and privileges of the Agent under
this Credit Agreement or any of the other Loan Documents or in respect of
the Collateral or in support of any provision of adequate indemnity to the
Agent against any taxes or liens which by law shall have, or may have,
priority over the rights of the Agent to such monies;
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(b) Second, to all other Obligations in such order or preference as
the Majority Banks may determine; provided, however, that (i) distributions
shall be made (A) pari passu among Obligations with respect to the Agent's
fee payable pursuant to (S)5.2 and all other Obligations and (B) with
respect to each type of Obligation owing to the Banks, such as interest,
principal, fees and expenses, among the Banks pro rata, and (ii) the Agent
may in its discretion make proper allowance to take into account any
Obligations not then due and payable;
(c) Third, upon payment and satisfaction in full or other provisions
for payment in full satisfactory to the Banks and the Agent of all of the
Obligations, to the payment of any obligations required to be paid pursuant
to (S)9-504(1)(c) of the Uniform Commercial Code of the Commonwealth of
Massachusetts; and
(d) Fourth, the excess, if any, shall be returned to the Borrower or
to such other Persons as are entitled thereto.
13. SETOFF.
Regardless of the adequacy of any collateral, during the continuance of any
Event of Default, any deposits or other sums credited by or due from any of the
Banks to the Borrower and any securities or other property of the Borrower in
the possession of such Bank may be applied to or set off by such Bank against
the payment of Obligations and any and all other liabilities, direct, or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrower to such Bank. Each of the Banks agrees with
each other Bank that (a) if an amount to be set off is to be applied to
Indebtedness of the Borrower to such Bank, other than Indebtedness evidenced by
the Notes held by such Bank or constituting Reimbursement Obligations owed to
such Bank, such amount shall be applied ratably to such other Indebtedness and
to the Indebtedness evidenced by all such Notes held by such Bank or
constituting Reimbursement Obligations owed to such Bank, and (b) if such Bank
shall receive from the Borrower, whether by voluntary payment, exercise of the
right of setoff, counterclaim, cross action, enforcement of the claim evidenced
by the Notes held by, or constituting Reimbursement Obligations owed to, such
Bank by proceedings against the Borrower at law or in equity or by proof thereof
in bankruptcy, reorganization, liquidation, receivership or similar proceedings,
or otherwise, and shall retain and apply to the payment of the Note or Notes
held by, or Reimbursement Obligations owed to, such Bank any amount in excess of
its ratable portion of the payments received by all of the Banks with respect to
the Notes held by, and Reimbursement Obligations owed to, all of the Banks, such
Bank will make such disposition and arrangements with the other Banks with
respect to such excess, either by way of distribution, pro tanto assignment of
claims, subrogation or otherwise as shall result in each Bank receiving in
respect of the Notes held by it or Reimbursement obligations owed it, its
proportionate payment as contemplated by this Credit Agreement; provided that if
all or any part of such excess payment is thereafter recovered from such Bank,
such disposition and arrangements shall be rescinded and the amount restored to
the extent of such recovery, but without interest.
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14. THE AGENT.
14.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of each of
the Banks and to exercise all such powers as are hereunder and under any of
the other Loan Documents and any related documents delegated to the Agent,
together with such powers as are reasonably incident thereto, provided that
no duties or responsibilities not expressly assumed herein or therein shall
be implied to have been assumed by the Agent.
(b) The relationship between the Agent and each of the Banks is that
of an independent contractor. The use of the term "Agent" is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the
Banks. Nothing contained in this Credit Agreement nor the other Loan
Documents shall be construed to create an agency, trust or other fiduciary
relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to exercise
certain rights and perform certain duties and responsibilities hereunder
and under the other Loan Documents, the Agent is nevertheless a
"representative" of the Banks, as that term is defined in Article 1 of the
Uniform Commercial Code, for purposes of actions for the benefit of the
Banks and the Agent with respect to all collateral security and guaranties
contemplated by the Loan Documents. Such actions include the designation
of the Agent as "secured party", "mortgagee" or the like on all financing
statements and other documents and instruments, whether recorded or
otherwise, relating to the attachment, perfection, priority or enforcement
of any security interests, mortgages or deeds of trust in collateral
security intended to secure the payment or performance of any of the
Obligations, all for the benefit of the Banks and the Agent.
14.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers and execute
its duties by or through employees or agents and shall be entitled to take, and
to rely on, advice of counsel concerning all matters pertaining to its rights
and duties under this Credit Agreement and the other Loan Documents. The Agent
may utilize the services of such Persons as the Agent in its sole discretion may
reasonably determine, and all reasonable fees and expenses of any such Persons
shall be paid by the Borrower.
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14.3. NO LIABILITY. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable to any Bank for any
waiver, consent or approval given or any action taken, or omitted to be taken,
in good faith by it or them hereunder or under any of the other Loan Documents,
or in connection herewith or therewith, or be responsible for the consequences
of any oversight or error of judgment whatsoever, except that the Agent or such
other Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
14.4. NO REPRESENTATIONS.
14.4.1. GENERAL. The Agent shall not be responsible for the execution
or validity or enforceability of this Credit Agreement, the Notes, the Letters
of Credit, any of the other Loan Documents or any instrument at any time
constituting, or intended to constitute, collateral security for the Notes, or
for the value of any such collateral security or for the validity,
enforceability or collectability of any such amounts owing with respect to the
Notes, or for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of the Borrower or any of its
Subsidiaries, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or in
any instrument at any time constituting, or intended to constitute, collateral
security for the Notes or to inspect any of the properties, books or records of
the Borrower or any of its Subsidiaries. The Agent shall not be bound to
ascertain whether any notice, consent, waiver or request delivered to it by the
Borrower or any holder of any of the Notes shall have been duly authorized or is
true, accurate and complete. The Agent has not made nor does it now make any
representations or warranties, express or implied, nor does it assume any
liability to the Banks, with respect to the credit worthiness or financial
conditions of the Borrower or any of its Subsidiaries. Each Bank acknowledges
that it has, independently and without reliance upon the Agent or any other
Bank, and based upon such information and documents as it has deemed
appropriate, made its own credit analysis and decision to enter into this Credit
Agreement.
14.4.2. CLOSING DOCUMENTATION, ETC. For purposes of determining
compliance with the conditions set forth in (S)10, each Bank that has executed
this Credit Agreement shall be deemed to have consented to, approved or
accepted, or to be satisfied with, each document and matter either sent, or made
available, by the Agent to such Bank for consent, approval, acceptance or
satisfaction, or required thereunder to be to be consent to or approved by or
acceptable or satisfactory to such Bank, unless an officer of the Agent active
upon the Borrower's account shall have received notice from such Bank prior to
the Closing Date specifying such Bank's objection thereto and such objection
shall not have been withdrawn by notice to the Agent to such effect on or prior
to the Closing Date.
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14.5. PAYMENTS.
14.5.1. PAYMENTS TO AGENT. A payment by the Borrower to the Agent
hereunder or any of the other Loan Documents for the account of any Bank shall
constitute a payment to such Bank. The Agent agrees promptly to distribute to
each Bank such Bank's pro rata share of payments received by the Agent for the
account of the Banks except as otherwise expressly provided herein or in any of
the other Loan Documents.
14.5.2. DISTRIBUTION BY AGENT. If in the opinion of the Agent the
distribution of any amount received by it in such capacity hereunder, under the
Notes or under any of the other Loan Documents might involve it in liability, it
may refrain from making distribution until its right to make distribution shall
have been adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received and distributed by
the Agent is to be repaid, each Person to whom any such distribution shall have
been made shall either repay to the Agent its proportionate share of the amount
so adjudged to be repaid or shall pay over the same in such manner and to such
Persons as shall be determined by such court.
14.5.3. DELINQUENT BANKS. Notwithstanding anything to the contrary
contained in this Credit Agreement or any of the other Loan Documents, any Bank
that fails (a) to make available to the Agent its pro rata share of any
Revolving Credit Loan or to purchase any Letter of Credit Participation or (ii)
to comply with the provisions of (S)13 with respect to making dispositions and
arrangements with the other Banks, where such Bank's share of any payment
received, whether by setoff or otherwise, is in excess of its pro rata share of
such payments due and payable to all of the Banks, in each case as, when and to
the full extent required by the provisions of this Credit Agreement, shall be
deemed delinquent (a "Delinquent Bank") and shall be deemed a Delinquent Bank
until such time as such delinquency is satisfied. A Delinquent Bank shall be
deemed to have assigned any and all payments due to it from the Borrower,
whether on account of outstanding Revolving Credit Loans, Unpaid Reimbursement
Obligations, interest, fees or otherwise, to the remaining nondelinquent Banks
for application to, and reduction of, their respective pro rata shares of all
outstanding Revolving Credit Loans and Unpaid Reimbursement Obligations. The
Delinquent Bank hereby authorizes the Agent to distribute such payments to the
nondelinquent Banks in proportion to their respective pro rata shares of all
outstanding Revolving Credit Loans and Unpaid Reimbursement Obligations. A
Delinquent Bank shall be deemed to have satisfied in full a delinquency when and
if, as a result of application of the assigned payments to all outstanding
Revolving Credit Loans and Unpaid Reimbursement Obligations of the nondelinquent
Banks, the Banks' respective pro rata shares of all outstanding Revolving Credit
Loans and Unpaid Reimbursement Obligations have returned to those in effect
immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency.
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14.6. HOLDERS OF NOTES. The Agent may deem and treat the payee of any Note
or the purchaser of any Letter of Credit Participation as the absolute owner or
purchaser thereof for all purposes hereof until it shall have been furnished in
writing with a different name by such payee or by a subsequent holder, assignee
or transferee.
14.7. INDEMNITY. The Banks ratably agree hereby to indemnify and hold
harmless the Agent and its affiliates from and against any and all claims,
actions and suits (whether groundless or otherwise), losses, damages, costs,
expenses (including any expenses for which the Agent or such affiliate has not
been reimbursed by the Borrower as required by (S)16), and liabilities of every
nature and character arising out of or related to this Credit Agreement, the
Notes, or any of the other Loan Documents or the transactions contemplated or
evidenced hereby or thereby, or the Agent's actions taken hereunder or
thereunder, except to the extent that any of the same shall be directly caused
by the Agent's willful misconduct or gross negligence.
14.8. AGENT AS BANK; ETC. In its individual capacity, ABN AMRO shall have
the same obligations and the same rights, powers and privileges in respect to
its Commitment and the Revolving Credit Loans made by it, and as the holder of
any of the Notes and as the purchaser of any Letter of Credit Participations, as
it would have were it not also the Agent. None of the Banks designated as a
"Documentation Agent" herein shall have any rights, powers, privileges,
obligations, responsibilities, liabilities, or duties applicable to it as a
result of such designation.
14.9. RESIGNATION. The Agent may resign at any time by giving sixty (60)
days prior written notice thereof to the Banks and the Borrower. Upon any such
resignation, the Majority Banks shall have the right to appoint a successor
Agent. Unless a Default or Event of Default shall have occurred and be
continuing, such successor Agent shall be reasonably acceptable to the Borrower.
If no successor Agent shall have been so appointed by the Majority Banks and
shall have accepted such appointment within thirty (30) days after the retiring
Agent's giving of notice of resignation, then the retiring Agent may, on behalf
of the Banks, appoint a successor Agent, which shall be a financial institution
having a rating of not less than A or its equivalent by Standard & Poor's
Corporation. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation, the provisions of this Credit
Agreement and the other Loan Documents shall continue in effect for its benefit
in respect of any actions taken or omitted to be taken by it while it was acting
as Agent.
14.10. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Bank hereby
agrees that, upon any officer of such Bank active on the Borrower's account and
this Credit Agreement learning of the existence of a Default or an Event of
Default, it shall promptly notify the Agent thereof. The Agent hereby agrees
that upon receipt of any notice under this (S)14.10 it shall promptly notify the
other Banks of the existence of such Default or Event of Default.
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14.11. ACTION BY AGENT. The Agent shall be fully justified in failing or
refusing to take any action under this Credit Agreement unless it shall first
have received such advice or concurrence of the Majority Banks as it reasonably
deems appropriate or it shall first be indemnified to its reasonable
satisfaction by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Credit Agreement in accordance with a request of the Majority
Banks or, as expressly required herein, all Banks, and such request and any
action taken or failure to act pursuant thereto shall be binding upon the Banks
and all future holders of the Notes or of a Letter of Credit Participation.
15. EXPENSES AND INDEMNIFICATION.
15.1. EXPENSES. The Borrower agrees to pay (a) the reasonable costs of
producing and reproducing this Credit Agreement, the other Loan Documents and
the other agreements and instruments mentioned herein, (b) any taxes (including
any interest and penalties in respect thereto) payable by the Agent or any of
the Banks (other than taxes based upon the Agent's or any Bank's net income or
due to any Bank's failure to comply with (S)5.3.3. and (S)18.8, if applicable)
on or with respect to the transactions contemplated by this Credit Agreement
(the Borrower hereby agreeing to indemnify the Agent and each Bank with respect
thereto), (c) the reasonable fees, expenses and disbursements of the Agent's
Special Counsel or any local counsel to the Agent incurred in connection with
the preparation, syndication, administration or interpretation of the Loan
Documents and other instruments mentioned herein, each closing hereunder, any
amendments, modifications, approvals, consents or waivers hereto or hereunder,
or the cancellation of any Loan Document upon payment in full in cash of all of
the Obligations or pursuant to any terms of such Loan Document for providing for
such cancellation, (d) the fees, expenses and disbursements of the Agent or any
of its affiliates incurred by the Agent or such affiliate in connection with the
preparation, syndication, administration or interpretation of the Loan Documents
and other instruments mentioned herein, including all title insurance premiums
and surveyor, engineering and appraisal charges, (e) all reasonable out-of-
pocket expenses (including without limitation reasonable attorneys' fees and
costs, which attorneys may be employees of any Bank or the Agent, and reasonable
consulting, accounting, appraisal, investment banking and similar professional
fees and charges) incurred by any Bank or the Agent in connection with (i) the
enforcement of or preservation of rights under any of the Loan Documents against
the Borrower or any of its Subsidiaries or the administration thereof after the
occurrence of a Default or Event of Default and (ii) any litigation, proceeding
or dispute whether arising hereunder or otherwise, in any way related to any
Bank's or the Agent's relationship with the Borrower or any of its Subsidiaries
and (f) all reasonable fees, expenses and disbursements of the Agent incurred in
connection with UCC searches.
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15.2. INDEMNIFICATION. The Borrower agrees to indemnify and hold harmless
the Agent, its affiliates and the Banks from and against any and all claims,
actions and suits whether groundless or otherwise, and from and against any and
all liabilities, losses, damages and expenses of every nature and character
arising out of this Credit Agreement or any of the other Loan Documents or the
transactions contemplated hereby including, without limitation, (a) any actual
or proposed use by the Borrower or any of its Subsidiaries of the proceeds of
any of the Revolving Credit Loans or Letters of Credit, (b) the Borrower or any
of its Subsidiaries entering into or performing this Credit Agreement or any of
the other Loan Documents or (c) with respect to the Borrower and its
Subsidiaries and their respective properties and assets, the violation of any
Environmental Law, the presence, disposal, escape, seepage, leakage, spillage,
discharge, emission, release or threatened release of any Hazardous Substances
or any action, suit, proceeding or investigation brought or threatened with
respect to any Hazardous Substances (including, but not limited to, claims with
respect to wrongful death, personal injury or damage to property), in each case
including, without limitation, the reasonable fees and disbursements of counsel
and allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding, except to the extent that any of
the foregoing are directly caused by the gross negligence or willful misconduct
of the otherwise indemnified party. In litigation, or the preparation therefor,
the Banks and the Agent and its affiliates shall be entitled to select their own
counsel and, in addition to the foregoing indemnity, the Borrower agrees to pay
promptly the reasonable fees and expenses of such counsel. If, and to the extent
that the obligations of the Borrower under this (S)15.2 are unenforceable for
any reason, the Borrower hereby agrees to make the maximum contribution to the
payment in satisfaction of such obligations which is permissible under
applicable law.
15.3. SURVIVAL. The covenants contained in this (S)15 shall survive payment
or satisfaction in full of all other Obligations.
16. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
16.1. CONFIDENTIALITY. Each of the Banks and the Agent agrees, on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives, to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of the same nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by the Borrower or any of its Subsidiaries
pursuant to this Credit Agreement that is financial information or that is
otherwise identified by such Person as being confidential at the time the same
is delivered to the Banks or the Agent, provided that nothing herein shall limit
the disclosure of any such information (a) after such information shall have
become public other than through a violation of this (S)16, (b) to the extent
required by statute, rule, regulation or judicial process, (c) to counsel for
any of the Banks or the Agent, (d) to bank examiners or any other regulatory
authority having jurisdiction over any Bank or the Agent, or to auditors or
accountants, (e) to the Agent, any Bank or any affiliate of the Agent or any
Bank which has agreed to be bound by the confidentiality provision of this
(S)16.1, (f) in connection with any litigation to which any one or more of the
Banks, the Agent or any affiliate of the Agent or any Bank is a party, or in
connection with the enforcement of rights or remedies hereunder or under any
other Loan Document, or (g) to any assignee or participant (or prospective
assignee or participant) so long as such assignee or participant agrees to be
bound by the provisions of (S)18.6.
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16.2. PRIOR NOTIFICATION. Unless specifically prohibited by applicable law
or court order, each of the Banks and the Agent shall, prior to disclosure
thereof, notify the Borrower of any request for disclosure of any such non-
public information by any governmental agency or representative thereof (other
than any such request in connection with an examination of the financial
condition of such Bank by such governmental agency) or pursuant to legal
process.
16.3. OTHER. In no event shall any Bank or the Agent be obligated or
required to return any materials furnished to it or any affiliate of any of the
foregoing by the Borrower or any of its Subsidiaries. The obligations of each
Bank under this (S)16 shall supersede and replace the obligations of such Bank
under any confidentiality letter in respect of this financing signed and
delivered by such Bank to the Borrower prior to the date hereof and shall be
binding upon any assignee of, or purchaser of any participation in, any interest
in any of the Revolving Credit Loans or Reimbursement Obligations from any Bank.
17. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein, in
the Notes, in any of the other Loan Documents or in any documents or other
papers delivered by or on behalf of the Borrower or any of its Subsidiaries
pursuant hereto shall be deemed to have been relied upon by the Banks and the
Agent, notwithstanding any investigation heretofore or hereafter made by any of
them, and shall survive the making by the Banks of any of the Revolving Credit
Loans and the issuance, extension or renewal of any Letters of Credit, as herein
contemplated, and shall continue in full force and effect so long as any Letter
of Credit or any amount due under this Credit Agreement or the Notes or any of
the other Loan Documents remains outstanding or any Bank has any obligation to
make any Revolving Credit Loans or the Agent has any obligation to issue, extend
or renew any Letter of Credit, and for such further time as may be otherwise
expressly specified in this Credit Agreement. All statements contained in any
certificate or other paper delivered to any Bank or the Agent at any time by the
Borrower or any of its Subsidiaries pursuant hereto or in connection with the
transactions contemplated hereby shall constitute representations and warranties
by the Borrower or such Subsidiary hereunder.
18. ASSIGNMENT AND PARTICIPATION.
18.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided herein, each
Bank may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Credit Agreement (including all or
a portion of its Revolver A Commitment Percentage, Revolver B Commitment
Percentage and Commitment and the same portion of the Revolving Credit Loans at
the time owing to it, the Notes held by it and its participating interest in the
risk relating to any Letters of Credit, provided, however, any assignor making
an assignment hereunder shall be required to make a pro rata assignment to the
Eligible Assignee of such assignor's interests, rights and obligations of its
Revolver A Commitment Percentage and its Revolver B Commitment Percentage);
provided that (a) each of the Agent and, unless a Default or Event of
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Default shall have occurred and be continuing, the Borrower shall have given its
prior written consent to such assignment, which consents will not be
unreasonably withheld, except that such consents shall not be required in the
event of any assignment from a Bank to an Affiliate of such Bank so long as such
Affiliate qualifies as an Eligible Assignee and such Affiliate is incorporated
or organized under the laws of the United States of America or a state thereof
or the District of Columbia, (b) each such assignment shall be of a constant,
and not a varying, percentage of all the assigning Bank's rights and obligations
under this Credit Agreement, (c) each assignment shall be in an amount that is a
whole multiple of $5,000,000 (or less, if it represents the entire amount of the
Assignors Revolver A Commitment or Revolver B Commitment) and (d) the parties to
such assignment shall execute and deliver to the Agent, for recording in the
Register (as hereinafter defined), an Assignment and Acceptance, substantially
in the form of Exhibit E hereto (an "Assignment and Acceptance"), together with
any Notes subject to such assignment. Upon such execution, delivery, acceptance
and recording, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least five (5) Business Days
after the execution thereof, (i) the assignee thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Bank hereunder, and (ii) the assigning Bank shall, to the
extent provided in such assignment and upon payment to the Agent of the
registration fee referred to in (S)18.3, be released from its obligations under
this Credit Agreement.
18.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS. By
executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows:
(a) other than the representation and warranty that it is the legal
and beneficial owner of the interest being assigned thereby free and clear
of any adverse claim, the assigning Bank makes no representation or
warranty, express or implied, and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
this Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Credit Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or
the attachment, perfection or priority of any security interest or
mortgage,
(b) the assigning Bank makes no representation or warranty and assumes
no responsibility with respect to the financial condition of the Borrower
and its Subsidiaries or any other Person primarily or secondarily liable in
respect of any of the Obligations, or the performance or observance by the
Borrower and its Subsidiaries or any other Person primarily or secondarily
liable in respect of any of the Obligations of any of their obligations
under this Credit Agreement or any of the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto;
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(c) such assignee confirms that it has received a copy of this Credit
Agreement, together with copies of the most recent financial statements
referred to in (S)6.4 and (S)7.4 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision
to enter into such Assignment and Acceptance;
(d) such assignee will, independently and without reliance upon the
assigning Bank, the Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Credit
Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
(f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this Credit
Agreement and the other Loan Documents as are delegated to the Agent by the
terms hereof or thereof, together with such powers as are reasonably
incidental thereto;
(g) such assignee agrees that it will perform in accordance with their
terms all of the obligations that by the terms of this Credit Agreement are
required to be performed by it as a Bank;
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; and
(i) such assignee acknowledges that it has made arrangements with the
assigning Bank satisfactory to such assignee with respect to its pro rata
share of Letter of Credit Fees in respect of outstanding Letters of Credit.
18.3. REGISTER. The Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register or similar list (the "Register") for
the recordation of the names and addresses of the Banks and the Commitment
Percentage of, and principal amount of the Revolving Credit Loans owing to and
Letter of Credit Participations purchased by, the Banks from time to time. The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Agent and the Banks may treat each Person whose name is
recorded in the Register as a Bank hereunder for all purposes of this Credit
Agreement. The Register shall be available for inspection by the Borrower and
the Banks at any reasonable time and from time to time upon reasonable prior
notice. Upon each such recordation, the assigning Bank agrees to pay or cause to
be paid to the Agent a registration fee in the sum of $3,500.00.
18.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance executed
by the parties to such assignment, together with each Note subject to such
assignment, the Agent shall (a) record the information contained therein in the
Register, and (b) give prompt notice thereof to the Borrower and the Banks
(other than the assigning Bank). Within five (5) Business Days after receipt of
such notice, the Borrower, at its own expense, shall execute and deliver to the
Agent, in exchange for each surrendered Note,
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a new Note to the order of such Eligible Assignee in an amount equal to the
amount assumed by such Eligible Assignee pursuant to such Assignment and
Acceptance and, if the assigning Bank has retained some portion of its
obligations hereunder, a new Note to the order of the assigning Bank in an
amount equal to the amount retained by it hereunder. Such new Notes shall
provide that they are replacements for the surrendered Notes, shall be in an
aggregate principal amount equal to the aggregate principal amount of the
surrendered Notes, shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of the assigned
Notes. The surrendered Notes shall be cancelled and returned to the Borrower.
18.5. PARTICIPATIONS. Each Bank may sell participations to one or more
banks or other entities in all or a portion of such Bank's rights and
obligations under this Credit Agreement and the other Loan Documents; provided
that (a) each such participation shall be in an amount of not less than
$1,000,000.00, (b) any such sale or participation shall not affect the rights
and duties of the selling Bank hereunder to the Borrower and (c) the only rights
granted to the participant pursuant to such participation arrangements with
respect to waivers, amendments or modifications of the Loan Documents shall be
the rights to approve waivers, amendments or modifications that would reduce the
principal of or the interest rate on any Revolving Credit Loans, extend the term
or increase the amount of the Commitment of such Bank as it relates to such
participant, reduce the amount of any commitment fees or Letter of Credit Fees
to which such participant is entitled or extend any regularly scheduled payment
date for principal or interest.
18.6. DISCLOSURE. The Borrower agrees that in addition to disclosures made
in accordance with standard and customary banking practices any Bank may
disclose information obtained by such Bank pursuant to this Credit Agreement to
assignees or participants and potential assignees or participants hereunder;
provided that such assignees or participants or potential assignees or
participants shall (a) agree to be bound by the confidentiality provision of
(S)16.1 hereof and (b) not to make use of such information for purposes of
transactions unrelated to such contemplated assignment or participation. For
purposes of this (S)18.6 an assignee or participant or potential assignee or
participant may include a counterparty with whom such Bank has entered into or
potentially might enter into a derivative contract referenced to credit or other
risks or events arising under this Credit Agreement or any other Loan Document.
18.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any assignee
Bank is an Affiliate of the Borrower, then any such assignee Bank shall have no
right to vote as a Bank hereunder or under any of the other Loan Documents for
purposes of granting consents or waivers or for purposes of agreeing to
amendments or other modifications to any of the Loan Documents or for purposes
of making requests to the Agent pursuant to (S)12.1 or (S)12.2, and the
determination of the Majority Banks shall for all purposes of this Credit
Agreement and the other Loan Documents be made without regard to such assignee
Bank's interest in any of the Revolving Credit Loans or Reimbursement
Obligations. If any Bank sells a participating interest in any of the Revolving
Credit Loans or Reimbursement Obligations to a participant, and such participant
is the
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Borrower or an Affiliate of the Borrower, then such transferor Bank shall
promptly notify the Agent of the sale of such participation. A transferor Bank
shall have no right to vote as a Bank hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or modifications to any of the Loan Documents or for
purposes of making requests to the Agent pursuant to (S)12.1 or (S)12.2 to the
extent that such participation is beneficially owned by the Borrower or any
Affiliate of the Borrower, and the determination of the Majority Banks shall for
all purposes of this Credit Agreement and the other Loan Documents be made
without regard to the interest of such transferor Bank in the Revolving Credit
Loans or Reimbursement Obligations to the extent of such participation.
18.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Bank shall retain
its rights to be indemnified pursuant to (S)15 with respect to any claims or
actions arising prior to the date of such assignment. If any Reference Bank
transfers all of its interests, right and obligations under this Credit
Agreement, the Agent shall in consultation with the Borrower and with the
consent of the Borrower and the Majority Banks, appoint another Bank to act as a
Reference Bank hereunder. Anything contained in this (S)18 to the contrary
notwithstanding, any Bank may at any time pledge all or any portion of its
interest and rights under this Credit Agreement (including all or any portion of
its Notes) to any of the twelve Federal Reserve Banks organized under (S)4 of
the Federal Reserve Act, 12 U.S.C. (S)341. No such pledge or the enforcement
thereof shall release the pledgor Bank from its obligations hereunder or under
any of the other Loan Documents.
18.9. ASSIGNMENT BY BORROWER. The Borrower shall not assign or transfer any
of its rights or obligations under any of the Loan Documents without the prior
written consent of each of the Banks.
19. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Applications shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail, postage prepaid, sent by overnight courier, or sent
by telegraph, telecopy, facsimile or telex and confirmed by delivery via courier
or postal service, addressed as follows:
(a) if to the Borrower, at ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇,
Attention: Corporate Treasurer and General Counsel or at such other address
for notice as the Borrower shall last have furnished in writing to the
Person giving the notice;
(b) if to the Agent, at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Assistant Vice
President, or such other address for notice as the Agent shall last have
furnished in writing to the Person giving the notice; and
81
(c) if to any Bank, at such Bank's address set forth on Schedule 1
hereto, or such other address for notice as such Bank shall have last
furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or made
and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile and
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof.
20. GOVERNING LAW.
THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH OF MASSACHUSETTS
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWER
AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF
MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN (S)19. THE
BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE
VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT COURT.
21. HEADINGS.
The captions in this Credit Agreement are for convenience of reference only
and shall not define or limit the provisions hereof.
22. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in several
counterparts and by each party on a separate counterpart, each of which when
executed and delivered shall be an original, and all of which together shall
constitute one instrument. In proving this Credit Agreement it shall not be
necessary to produce or account for more than one such counterpart signed by the
party against whom enforcement is sought.
82
23. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection herewith
or therewith express the entire understanding of the parties with respect to the
transactions contemplated hereby. Neither this Credit Agreement nor any term
hereof may be changed, waived, discharged or terminated, except as provided in
(S)25.
24. WAIVER OF JURY TRIAL.
Each of the Agent, the Banks and the Borrower hereby waives its right to a
jury trial with respect to any action or claim arising out of any dispute in
connection with this Credit Agreement, the Notes or any of the other Loan
Documents, any rights or obligations hereunder or thereunder or the performance
of such rights and obligations. Except as prohibited by law, the Borrower
hereby waives any right it may have to claim or recover in any litigation
referred to in the preceding sentence any special, exemplary, punitive or
consequential damages or any damages other than, or in addition to, actual
damages. The Borrower (a) certifies that no representative, agent or attorney
of any Bank or the Agent has represented, expressly or otherwise, that such Bank
or the Agent would not, in the event of litigation, seek to enforce the
foregoing waivers and (b) acknowledges that the Agent and the Banks have been
induced to enter into this Credit Agreement, the other Loan Documents to which
it is a party by, among other things, the waivers and certifications contained
herein.
25. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Any consent or approval required or permitted by this Credit Agreement to
be given by the Banks may be given, and any term of this Credit Agreement, the
other Loan Documents or any other instrument related hereto or mentioned herein
may be amended, and the performance or observance by the Borrower or any of its
Subsidiaries of any terms of this Credit Agreement, the other Loan Documents or
such other instrument or the continuance of any Default or Event of Default
(other than a Default or Event of Default under (S)12.1(g) or (S)12.1(h)) may be
waived (either generally or in a particular instance and either retroactively or
prospectively) with, but only with, the written consent of the Borrower and the
written consent of the Majority Banks. Notwithstanding the foregoing, the rate
of interest on the Notes (other than interest accruing pursuant to (S)5.11.2
following the effective date of any waiver by the Majority Banks of the Default
or Event of Default relating thereto) or the amount of the Revolver A Commitment
Fee, the Revolver B Commitment Fee or Letter of Credit Fees may not be decreased
without the written consent of each Bank affected thereby; the amount of the
Commitments may not be increased without the written consent of the Borrower and
of each Bank affected thereby; the Revolving Credit A Loan Maturity Date and the
Revolving Credit B Loan Maturity Date may not be postponed, and no date fixed
for payment may be postponed without the written consent of each Bank affected
thereby; (S)12.1(g) and (S)12.1(h) may not be amended, and no Default or Event
of Default thereunder may be waived, and this (S)26 and the definition of
Majority Banks may not be amended, without the written consent of all of the
Banks; and the amount of the Agent's Fee or any Letter of Credit Fees payable
for the
83
Agent's account and (S)15 may not be amended without the written consent of the
Agent. No waiver shall extend to or affect any obligation not expressly waived
or impair any right consequent thereon. No course of dealing or delay or
omission on the part of the Agent or any Bank in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial thereto. No notice to or
demand upon the Borrower shall entitle the Borrower to other or further notice
or demand in similar or other circumstances.
26. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one clause
or provision hereof shall be held invalid or unenforceable in whole or in part
in any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision, or part thereof, in such jurisdiction, and shall not
in any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision of this Credit Agreement in any jurisdiction.
84
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
-----------------------------------
Title: Corporate Treasurer
----------------------------------
ABN AMRO BANK N.V., individually and as Agent
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Title: Assistant Vice President
----------------------------------
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Title: Group Vice President
----------------------------------
BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------------
Title: Vice President
----------------------------------
FLEET NATIONAL BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Title: Director
----------------------------------
▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ BANK
By: /s/ ▇▇▇▇▇▇ Dellatouve
----------------------------------------
Name: ▇▇▇▇▇▇ Dellatouve
-----------------------------------
Title: Assistant Vice President
----------------------------------
CITIZENS BANK OF MASSACHUSETTS
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Title: Vice President
----------------------------------
THE FUJI BANK, LIMITED
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Title: Senior Vice President & Group Head
----------------------------------
86
Schedule 1
Banks; Commitments
REVOLVER A REVOLVER A REVOLVER B REVOLVER B
BANK COMMITMENT COMMITMENT COMMITMENT COMMITMENT
AMOUNT PERCENTAGE AMOUNT PERCENTAGE
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
ABN AMRO Bank N.V.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ $16,000,000 26.6667% $4,000,000 26.6667%
Chicago, Illinois
LIBOR Lending Office: Same
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
Fleet National Bank $11,500,000 19.1667% $2,875,000 19.1667%
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
LIBOR Lending Office: Same
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
Bank of America, N.A. $11,500,000 19.1667% $2,875,000 19.1667%
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
LIBOR Lending Office: Same
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
The Chase Manhattan Bank $ 7,000,000 11.6666% $1,750,000 11.6666%
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
LIBOR Lending Office: Same
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
Citizens Bank of Massachusetts $ 7,000,000 11.6666% $1,750,000 11.6666%
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇
LIBOR Lending Office: Same
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
The Fuji Bank, Limited $ 7,000,000 11.6666% $1,750,000 11.6666%
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
LIBOR Lending Office: Same
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------
87