EXECUTION FORM
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$505,000,000
CREDIT AGREEMENT
among
IMPERIAL ▇▇▇▇▇ CORPORATION,
as Borrower,
The Several Lenders
from Time to Time Parties Hereto,
▇▇▇▇▇▇ BROTHERS, INC.,
as Arranger
▇▇▇▇▇▇ COMMERCIAL PAPER INC.,
as Syndication Agent
and
▇▇▇▇▇▇ COMMERCIAL PAPER INC.,
as Administrative Agent
Dated as of October 17, 1997
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TABLE OF CONTENTS
Page
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SECTION 1. DEFINITIONS................................................... 2
1.1 Defined Terms........................................................ 2
1.2 Other Definitional Provisions........................................ 20
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS............................... 20
2.1 Term Loan Commitments................................................ 20
2.2 Procedure for Term Loan Borrowing.................................... 20
2.3 Revolving Credit Commitments......................................... 21
2.4 Procedure for Revolving Credit Borrowing............................. 21
2.5 Repayment of Loans; Evidence of Debt................................. 22
2.6 Commitment Fees, etc................................................. 22
2.7 Termination or Reduction of Revolving Credit Commitments............. 23
2.8 Optional Prepayments................................................. 23
2.9 Conversion and Continuation Options.................................. 23
2.10 Minimum Amounts and Maximum Number of Eurodollar Tranches........... 24
2.11 Interest Rates and Payment Dates.................................... 24
2.12 Computation of Interest and Fees.................................... 25
2.13 Inability to Determine Interest Rate................................ 25
2.14 Pro Rata Treatment and Payments..................................... 26
2.15 Requirements of Law................................................. 27
2.16 Taxes............................................................... 28
2.17 Indemnity........................................................... 30
2.18 Change of Lending Office; Claims Certificate........................ 30
2.19 Margin Regulations.................................................. 31
2.20 Illegality.......................................................... 32
SECTION 3. LETTERS OF CREDIT............................................. 32
3.1 L/C Commitment....................................................... 32
3.2 Procedure for Issuance of Letter of Credit........................... 33
3.3 Commissions, Fees and Other Charges.................................. 33
3.4 L/C Participations................................................... 33
3.5 Reimbursement Obligation of the Borrower............................. 34
3.6 Obligations Absolute................................................. 35
3.7 Letter of Credit Payments............................................ 35
3.8 Applications......................................................... 35
SECTION 4. REPRESENTATIONS AND WARRANTIES................................ 35
4.1 Financial Condition.................................................. 35
4.2 No Change............................................................ 37
4.3 Corporate Existence; Compliance with Law............................. 37
4.4 Corporate Power; Authorization; Enforceable Obligations.............. 37
4.5 No Legal Bar......................................................... 38
4.6 No Material Litigation............................................... 38
4.7 No Default........................................................... 38
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4.8 Ownership of Property; Liens........................................ 38
4.9 Intellectual Property............................................... 38
4.10 Taxes............................................................... 38
4.11 Federal Regulations................................................. 39
4.13 Investment Company Act; Other Regulations........................... 39
4.14 Subsidiaries........................................................ 39
4.15 Use of Proceeds..................................................... 39
4.16 Environmental Matters............................................... 40
4.17 Accuracy of Information, etc........................................ 41
4.18 Security Documents.................................................. 41
4.19 Solvency............................................................ 42
4.20 Regulation H........................................................ 42
SECTION 5. CONDITIONS PRECEDENT.......................................... 42
5.1 Conditions to Initial Revolving Extension of Credit................. 42
5.2 Conditions to Term Loans............................................ 47
5.3 Conditions to Each Extension of Credit.............................. 48
SECTION 6. AFFIRMATIVE COVENANTS......................................... 49
6.1 Financial Statements................................................ 49
6.2 Certificates; Other Information..................................... 49
6.3 Payment of Obligations.............................................. 50
6.4 Conduct of Business and Maintenance of Existence, etc............... 51
6.5 Maintenance of Property; Insurance.................................. 51
6.6 Inspection of Property; Books and Records; Discussions.............. 51
6.7 Notices............................................................. 51
6.8 Environmental Laws.................................................. 52
6.9 Additional Collateral, etc.......................................... 53
6.10 Merger Consummation; Merger Agreement............................... 55
SECTION 7. NEGATIVE COVENANTS............................................ 55
7.1 Limitation on Activities of IHK Merger Sub.......................... 55
7.2 Limitation on Indebtedness.......................................... 55
7.3 Limitation on Liens................................................. 56
7.4 Limitation on Fundamental Changes................................... 58
7.5 Limitation on Sale of Assets........................................ 58
7.6 Limitation on Dividends............................................. 59
7.7 Limitation on Capital Expenditures.................................. 59
7.8 Limitation on Investments, Loans and Advances....................... 59
7.9 Limitation on Transactions with Affiliates.......................... 60
7.10 Limitation on Sales and Leasebacks.................................. 60
7.11 Limitation on Changes in Fiscal Periods............................. 60
7.12 Limitation on Negative Pledge Clauses............................... 60
7.13 Limitation on Restrictions on Subsidiary Distributions.............. 61
7.14 Limitation on Lines of Business..................................... 61
7.15 Limitation on Amendments to Transaction Documentation............... 61
7.16 Limitation on Optional Payments and Modifications of Debt
Instruments Organizational Documentation, etc....................... 61
SECTION 8. EVENTS OF DEFAULT............................................. 62
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SECTION 9. THE AGENTS.................................................... 65
9.1 Appointment......................................................... 65
9.2 Delegation of Duties................................................ 65
9.3 Exculpatory Provisions.............................................. 65
9.4 Reliance by Administrative Agent.................................... 66
9.5 Notice of Default................................................... 66
9.6 Non-Reliance on Agents and Other Lenders............................ 66
9.7 Indemnification..................................................... 67
9.8 Agent in Its Individual Capacity.................................... 67
9.9 Successor Administrative Agent...................................... 68
9.10 Authorization to Release Liens...................................... 68
9.11 The Arranger........................................................ 68
SECTION 10. MISCELLANEOUS................................................ 68
10.1 Amendments and Waivers............................................. 68
10.2 Notices............................................................ 69
10.3 No Waiver; Cumulative Remedies..................................... 70
10.4 Survival of Representations and Warranties......................... 70
10.5 Payment of Expenses................................................ 70
10.6 Successors and Assigns; Participations and Assignments............. 71
10.7 Adjustments; Setoff................................................ 74
10.8 Counterparts....................................................... 74
10.9 Severability....................................................... 74
10.10 Integration........................................................ 75
10.11 GOVERNING LAW...................................................... 75
10.12 Submission To Jurisdiction; Waivers................................ 75
10.13 Acknowledgements................................................... 75
10.14 WAIVERS OF JURY TRIAL.............................................. 76
10.15 Confidentiality.................................................... 76
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SCHEDULES:
1.1A Commitments
1.1B Mortgaged Property
1.1C Permitted Investors
1.1D Non-Subsidiary Guarantor Subsidiaries
4.4 Consents, Authorizations, Filings and Notices
4.14 Subsidiaries
4.17 Real Property Located in Flood Zone
4.18(a) UCC Filing Jurisdictions
4.18(b) Mortgage Filing Jurisdictions
5.2(c) Governmental and Third Party Approvals
7.2(e) Existing Indebtedness
7.3(f) Existing Liens
7.8(i) Extensions of Credit
EXHIBITS:
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D Form of Mortgage
E Form of Assignment and Acceptance
F-1 Form of Legal Opinion of ▇▇▇▇▇▇▇ & ▇▇▇▇▇ L.L.P.
F-2 Form of Legal Opinion of Borrower's General Counsel
G-1 Form of Term Note
G-2 Form of Revolving Credit Note
H Form of Exemption Certificate
I Form of Target Pledge Agreement
J Form of Depositary Agency Agreement
K-1 Form of Notice of Borrowing (Drawings)
K-2 Form of Notice of Borrowing (Conversions)
K-3 Form of Notice of Borrowing (Continuations)
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CREDIT AGREEMENT, dated as of October 17, 1997, among IMPERIAL ▇▇▇▇▇
CORPORATION, a Texas corporation (the "Borrower"), the several banks and other
financial institutions or entities from time to time parties to this Agreement
(the "Lenders"), ▇▇▇▇▇▇ BROTHERS, INC., as arranger (in such capacity, the
"Arranger"), ▇▇▇▇▇▇ COMMERCIAL PAPER INC., as syndication agent (in such
capacity, the "Syndication Agent"),, ▇▇▇▇▇▇ TRUST AND SAVINGS BANK, as
collateral agent (in such capacity, the "Collateral Agent") and ▇▇▇▇▇▇
COMMERCIAL PAPER INC., as administrative agent (in such capacity, the
"Administrative Agent").
W I T N E S S E T H:
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WHEREAS, IHK Merger Sub Corporation, a Delaware corporation ("IHK
Merger Sub"), a wholly owned subsidiary of the Borrower, has made an offer (the
"Tender Offer") to purchase a number (the "Specified Number of Shares") of the
outstanding shares (the "Shares") of common stock equal to 14,397,836 or such
other number of Shares which represents approximately 50.1% of the Shares
outstanding at the date of such purchase, par value $0.25, of Savannah Foods &
Industries, Inc., a Delaware corporation (the "Target"), pursuant to an Offer to
Purchase dated September 18, 1997 (as amended, supplemented or otherwise
modified from time to time in accordance with the terms hereof, the "Offer to
Purchase") at a price of $20.25 per Share;
WHEREAS, the Offer to Purchase is being made pursuant to an Agreement
and Plan of Merger, dated as of September 12, 1997 (including the schedules
thereto, the "Merger Agreement"), among the Borrower, IHK Merger Sub and Target,
which provides that (i) as soon as practicable after the purchase of Shares (the
"Tender Offer Purchase") pursuant to the Offer to Purchase (subject to certain
conditions), each of the Borrower and the Target acting through its respective
Board of Directors shall give notice of, and convene a special meeting of, its
respective stockholders for the purpose of (in the case of Target) approving and
adopting the Merger Agreement and the Merger or (in the case of the Borrower)
approving the issuance of shares of common stock of the Borrower in the Merger
and subject to such stockholder approvals, IHK Merger Sub will be merged with
and into the Target (the "Merger"; together with the Tender Offer, the Tender
Offer Purchase and the transactions contemplated in connection therewith, the
"Acquisition"), with the Target surviving as a wholly owned subsidiary of the
Borrower; (ii) at the effective time of the Merger, each of the Shares (other
than Shares held by the Borrower, IHK Merger Sub or any of their subsidiaries or
in the treasury of the Target, all of which will be canceled, and Shares held by
Target stockholders who perfect their appraisal rights under Delaware law) will
be converted into the right to receive a combination of cash consideration and
shares of common stock, without par value, of the Borrower pursuant to the
proration and stock price determination procedures set forth in the Merger
Agreement and the Offer to Purchase such that the aggregate cash consideration
paid for Shares pursuant to the Tender Offer Purchase and the Merger equals
approximately 70% of the total such consideration so paid;
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WHEREAS, (i) in order to provide the financing for the Tender Offer
Purchase, the repayment of up to approximately $136,000,000 in existing
indebtedness of the Borrower and certain related expenses, and to provide for
the Borrower's working capital needs pending the Merger, the Borrower will
require senior tender and revolving credit facilities in the aggregate amount of
$505,000,000, comprised of a term loan facility of $295,000,000 and a revolving
credit facility of $210,000,000 and (ii) in order to provide a portion of the
financing for the Merger and certain related expenses, the refinancing of
certain indebtedness of Target, the repayment of amounts owing under the Tender
Facilities and to provide financing for future working capital and other general
corporate purposes, the Borrower will require financing comprised of either (A)
(1) senior credit facilities of up to $455,000,000 (the "Alternative A Merger
Facilities"), comprised of term loan facilities aggregating not more than
$255,000,000 and a $200,000,000 revolving credit facility and (2) $250,000,000
in proceeds of unsecured senior subordinated notes issued by the Borrower (the
"Senior Subordinated Notes") or (B) in the event that the Senior Subordinated
Notes are not issued and sold on the date of consummation of the Merger, senior
credit facilities of up to $705,000,000 (the "Alternative B Merger Facilities"),
comprised of term loan facilities aggregating not more than $505,000,000 and a
$200,000,000 revolving credit facility; and
WHEREAS, the Lenders are willing to make the senior tender and
revolving credit facilities referred to above available upon and subject to the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the agreements
hereinafter set forth, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms listed in
this Section 1.1 shall have the respective meanings set forth in this Section
1.1.
"Acquisition": as defined in the recitals hereto.
"Administrative Agent": as defined in the preamble hereto.
"Affiliate": as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person
means the power, directly or indirectly, either to (a) vote 10% or more of
the securities having ordinary voting power for the election of directors
(or persons performing similar functions) of such Person or (b) direct or
cause the direction of the management and policies of such Person, whether
by contract or otherwise.
"Agents": the collective reference to the Syndication Agent, the
Administrative Agent and the Collateral Agent.
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"Agreement": this Credit Agreement, as amended, supplemented or
otherwise modified from time to time.
"Alternative A Merger Facilities": as defined in the recitals hereto.
"Alternative B Merger Facilities": as defined in the recitals hereto.
"Applicable Margin": for each Type of Loan, the rate per annum set
forth under the relevant column heading below:
Base Rate Eurodollar
Loans Loans
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Revolving Credit Loans 1.50% 2.50%
Term Loans 1.50% 2.50%
"Application": an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to open a Letter
of Credit.
"Arranger": as defined in the preamble hereto.
"Assignee": as defined in Section 10.6(c).
"Assignor": as defined in Section 10.6(c).
"Available Revolving Credit Commitment": as to any Revolving Credit
Lender at any time, an amount equal to the excess, if any, of (a) such
Lender's Revolving Credit Commitment over (b) such Lender's Revolving
Extensions of Credit.
"Available Commitment": as to any Lender at any time, an amount equal
to the sum of (a) such Lender's Available Revolving Credit Commitment at
such time plus (b) the excess, if any, of such Lender's Term Loan
Commitment over the aggregate principal amount of the Term Loans made by
such Lender.
"Base Rate": for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime
Rate in effect on such day, (b) the Base CD Rate in effect on such day plus
1% and (c) the Federal Funds Effective Rate in effect on such day plus 1/2
of 1%. For purposes hereof: "Prime Rate" shall mean the rate of interest
per annum publicly announced from time to time by the Reference Lender as
its prime rate in effect at its principal office in New York City (the
Prime Rate not being intended to be the lowest rate of interest charged by
the Reference Lender in connection with extensions of credit to debtors);
"Base CD Rate" shall mean the sum of (a) the product of (i) the Three-Month
Secondary CD Rate and (ii) a fraction, the numerator of which is one and
the denominator of which is one minus the C/D Reserve Percentage and (b)
the C/D Assessment Rate; and "Three-Month Secondary CD Rate" shall mean,
for any
4
day, the secondary market rate for three-month certificates of deposit
reported as being in effect on such day (or, if such day shall not be a
Business Day, the next preceding Business Day) by the Board through the
public information telephone line of the Federal Reserve Bank of New York
(which rate will, under the current practices of the Board, be published in
Federal Reserve Statistical Release H.15(519) during the week following
such day), or, if such rate shall not be so reported on such day or such
next preceding Business Day, the average of the secondary market quotations
for three-month certificates of deposit of major money center banks in New
York City received at approximately 10:00 A.M., New York City time, on such
day (or, if such day shall not be a Business Day, on the next preceding
Business Day) by the Reference Lender from three New York City negotiable
certificate of deposit dealers of recognized standing selected by it. Any
change in the Base Rate due to a change in the Prime Rate, the Three-Month
Secondary CD Rate or the Federal Funds Effective Rate shall be effective as
of the opening of business on the effective day of such change in the Prime
Rate, the Three-Month Secondary CD Rate or the Federal Funds Effective
Rate, respectively.
"Base Rate Loans": Loans the rate of interest applicable to which is
based upon the Base Rate.
"Board": the Board of Governors of the Federal Reserve System of the
United States (or any successor).
"Borrower": as defined in the preamble hereto.
"Borrowing Date": any Business Day specified by the Borrower as a
date on which the Borrower requests the relevant Lenders to make Loans
hereunder.
"Business Day": (i) for all purposes other than as covered by clause
(ii) below, a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to
close and (ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, any day
which is a Business Day described in clause (i) and which is also a day for
trading by and between banks in Dollar deposits in the interbank eurodollar
market.
"Capital Expenditures": for any period, with respect to any Person,
the aggregate of all expenditures by such Person and its Subsidiaries for
the acquisition or leasing (pursuant to a capital lease) of fixed or
capital assets or additions to equipment (including replacements,
capitalized repairs and improvements during such period) which should be
capitalized under GAAP on a consolidated balance sheet of such Person and
its Subsidiaries.
"Capital Lease Obligations": as to any Person, the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under
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GAAP and, for the purposes of this Agreement, the amount of such
obligations at any time shall be the capitalized amount thereof at such
time determined in accordance with GAAP.
"Capital Stock": any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a
corporation) and any and all warrants, rights or options to purchase any of
the foregoing.
"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by
any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one year from the date of acquisition;
(b) certificates of deposit, time deposits, eurodollar time deposits or
overnight bank deposits having maturities of six months or less from the
date of acquisition issued by any Lender or by any commercial bank
organized under the laws of the United States of America or any state
thereof having combined capital and surplus of not less than $500,000,000;
(c) commercial paper of an issuer rated at least A-2 by Standard & Poor's
Ratings Services ("S&P") or P-2 by ▇▇▇▇▇'▇ Investors Service, Inc.
("Moody's"), or carrying an equivalent rating by a nationally recognized
rating agency, if both of the two named rating agencies cease publishing
ratings of commercial paper issuers generally, and maturing within six
months from the date of acquisition; (d) repurchase obligations of any
Lender or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than 30 days with respect to
securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth
or territory of the United states, by any political subdivision or taxing
authority of any such state, commonwealth or territory or by any foreign
government, the securities of which state, commonwealth, territory,
political subdivision, taxing authority or foreign government (as the case
may be) are rated at least A by S&P or A by Moody's; (f) securities with
maturities of six months or less from the date of acquisition backed by
standby letters of credit issued by any Lender or any commercial bank
satisfying the requirements of clause (b) of this definition; or (g) shares
of money market mutual or similar funds which invest exclusively in assets
satisfying the requirements of clauses (a) through (f) of this definition.
"C/D Assessment Rate": for any day as applied to any Base Rate Loan,
the annual assessment rate in effect on such day which is payable by a
member of the Bank Insurance Fund maintained by the Federal Deposit
Insurance Corporation (the "FDIC") classified as well-capitalized and
within supervisory subgroup "B" (or a comparable successor assessment risk
classification) within the meaning of 12 C.F.R. (S) 327.4 (or any successor
provision) to the FDIC (or any successor) for the FDIC's (or such
successor's) insuring time deposits at offices of such institution in the
United States.
"C/D Reserve Percentage": for any day as applied to any Base Rate
Loan, that percentage (expressed as a decimal) which is in effect on such
day, as prescribed by the Board, for determining the maximum reserve
requirement for a Depositary Institution (as
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defined in Regulation D of the Board as in effect from time to time) in
respect of new non-personal time deposits in Dollars having a maturity of
30 days or more.
"Closing Date": the date on which the conditions precedent set forth
in Section 5.1 shall have been satisfied, which date shall not occur later
than November 30, 1997.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": all Property of the Loan Parties, now owned or
hereafter acquired, upon which a Lien is purported to be created by any
Security Document.
"Collateral Agent": as defined in the preamble hereto.
"Commitment": as to any Lender, the sum of the Term Loan Commitment
and the Revolving Credit Commitment of such Lender.
"Commitment Fee Rate": 3/8 of 1% per annum.
"Commitment Letter Date": September 10, 1997, the date of the
commitment letter executed by the Borrower and the Syndication Agent in
respect of the credit facilities provided for herein (as amended on
September 18, 1997).
"Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of
Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"Compliance Certificate": a certificate duly executed by a
Responsible Officer substantially in the form of Exhibit B.
"Continuing Directors": the directors of the Borrower on the Closing
Date, after giving effect to the Tender Offer and the other transactions
contemplated hereby to occur prior to the Closing Date, and each other
director, if, in each case, such other director's nomination for election
to the board of directors of the Borrower is recommended by at least 66-
2/3% of the then Continuing Directors.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound.
"Control Agreement": the Custody and Control Agreement, dated as of
the date hereof, among ▇▇▇▇▇▇▇ Sachs & Co., as securities intermediary, the
Collateral Agent and the Borrower, as the same may be amended, supplemented
or otherwise modified from time to time.
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"Control Investment Affiliate": as to any Person, any other Person
which (a) directly or indirectly, is in control of, is controlled by, or is
under common control with, such Person and (b) is organized by such Person
primarily for the purpose of making equity or debt investments and/or
holding investments or funds in trust or similar arrangements for the
benefit of such Person's family members. For purposes of this definition,
"control" of a Person means the power, directly or indirectly, to direct or
cause the direction of the management and policies of such Person whether
by contract or otherwise.
"Debt Tender Offer": the Offer to Purchase and Consent Solicitation
Statement, dated September 18, 1997, in respect of the Senior Notes.
"Default": any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
"Depositary": Wachovia Bank, N.A., in its capacity as depositary
under the Depositary Agency Agreement.
"Depositary Agency Agreement": the Depositary Agency Agreement to be
executed and delivered by the Depositary, the Administrative Agent and the
Borrower, substantially in the form of Exhibit J, as the same may be
amended, supplemented or otherwise modified from time to time.
"Disposition": with respect to any Property, any sale, lease, sale
and leaseback, assignment, conveyance, transfer or other disposition
thereof; and the terms "Dispose" and "Disposed of" shall have correlative
meanings.
"Dollars" and "$": dollars in lawful currency of the United States of
America.
"Domestic Subsidiary": any Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States of America.
"Environmental Laws": any and all laws, rules, orders, regulations,
statutes, ordinances, codes, decrees, or other legally enforceable
requirement (including, without limitation, Environmental Permits) of any
Governmental Authority, regulating, relating to or imposing liability or
standards of conduct concerning protection of the environment or of human
health, or employee health and safety, as has been, is now, or may at any
time hereafter be, in effect.
"Environmental Permits": any and all permits, licenses,
registrations, notifications, exemptions and any other authorization
required under any Environmental Law.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
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"Eurocurrency Reserve Requirements": for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such
day (including, without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board or other Governmental
Authority having jurisdiction with respect thereto) dealing with reserve
requirements prescribed for eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D of the Board) maintained by a
member bank of the Federal Reserve System.
"Eurodollar Base Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on
the basis of the rate for deposits in Dollars for a period equal to such
Interest Period commencing on the first day of such Interest Period
appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London
time, two Business Days prior to the beginning of such Interest Period. In
the event that such rate does not appear on Page 3750 of the Telerate
Service (or otherwise on such service), the "Eurodollar Base Rate" for
purposes of this definition shall be determined by reference to such other
comparable publicly available service for displaying eurodollar rates as
may be selected by the Administrative Agent and acceptable to Borrower or,
in the absence of such availability, by reference to the rate at which the
Administrative Agent is offered Dollar deposits at or about 11:00 A.M., New
York City time, two Business Days prior to the beginning of such Interest
Period in the interbank eurodollar market where its eurodollar and foreign
currency and exchange operations are then being conducted for delivery on
the first day of such Interest Period for the number of days comprised
therein.
"Eurodollar Loans": Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upward to the
nearest 1/100th of 1%):
Eurodollar Base Rate
----------------------------------------
1.00 - Eurocurrency Reserve Requirements
"Eurodollar Tranche": the collective reference to Eurodollar Loans
the then current Interest Periods with respect to all of which begin on the
same date and end on the same later date (whether or not such Loans shall
originally have been made on the same day).
"Event of Default": any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of time,
or both, has been satisfied.
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"Excluded Foreign Subsidiaries": any Foreign Subsidiary the pledge of
all of whose Capital Stock as Collateral would, in the good faith judgment
of the Borrower, result in adverse tax consequences to the Borrower.
"Existing Borrower Indebtedness": the collective reference to the
Senior Notes and the Existing Credit Facility.
"Existing Credit Facility": the Credit Agreement, dated as of June
10, 1993, among the Borrower, ▇▇▇▇▇▇ Trust and Savings Bank, as agent,
Texas Commerce Bank National Association, as co-agent and the Banks, as the
same may be amended, supplemented or otherwise modified from time to time.
"Facility": each of (a) the Term Loan Commitments and the Term Loans
made thereunder (the "Term Loan Facility") and (b) the Revolving Credit
Commitments and the extensions of credit made thereunder (the "Revolving
Credit Facility").
"Federal Funds Effective Rate"; for any day, 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 on
the next succeeding Business Day by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business Day,
the average of the quotations for the day of such transactions received by
the Reference Lender from three federal funds brokers of recognized
standing selected by it.
"Foreign Subsidiary": any Subsidiary of the Borrower that is not a
Domestic Subsidiary.
"Funding Office": the office specified from time to time by the
Administrative Agent as its funding office by notice to the Borrower and
the Lenders.
"GAAP": generally accepted accounting principles in the United States
of America as in effect from time to time set forth in the opinions and
pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and the statements and
pronouncements of the Financial Accounting Standards Board, or in such
other statements by such other entity as may be in general use by
significant segments of the accounting profession, which are applicable to
the circumstances of the Borrower as of the date of determination.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government (including, without limitation, the National
Association of Insurance Commissioners).
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by the Borrower and each Subsidiary
Guarantor, substantially
10
in the form of Exhibit A, as the same may be amended, supplemented or
otherwise modified from time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit) to
induce the creation of which the guaranteeing person has issued a
reimbursement, counterindemnity or similar obligation, in either case
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends
or other obligations (the "primary obligations") of any other third Person
(the "primary obligor") in any manner, whether directly or indirectly,
including, without limitation, any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or
any Property constituting direct or indirect security therefor, (ii) to
advance or supply funds (1) for the purchase or payment of any such primary
obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase Property, securities or services
primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the owner
of any such primary obligation against loss in respect thereof; provided,
however, that the term Guarantee Obligation shall not include endorsements
of instruments for deposit or collection in the ordinary course of business
or purchases of inventory (including crops and raw materials) in the
ordinary course of business. The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount equal
to the stated or determinable amount of the primary obligation in respect
of which such Guarantee Obligation is made and (b) the maximum amount for
which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary
obligation and the maximum amount for which such guaranteeing person may be
liable are not stated or determinable, in which case the amount of such
Guarantee Obligation shall be such guaranteeing person's maximum reasonably
anticipated liability in respect thereof as determined by the Borrower in
good faith.
"H-S-R Act": the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvement Act of 1976
as amended.
"IHK Merger Sub": as defined in the recitals hereto.
"Incur": as defined in Section 7.2.
"Indebtedness": of any Person at any date, without duplication, (a)
all indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of Property or services (other
than current trade payables incurred in the ordinary course of such
Person's business), (c) all obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments, (d) all indebtedness
created or arising under any conditional sale or other title retention
agreement with respect to Property acquired by such Person (even though the
rights and remedies of the seller or
11
lender under such agreement in the event of default are limited to
repossession or sale of such Property), (e) all Capital Lease Obligations
of such Person, (f) all obligations of such Person, contingent or
otherwise, as an account party under acceptance, letter of credit or
similar facilities, (g) all obligations of such Person, contingent or
otherwise, to purchase, redeem, retire or otherwise acquire for value any
Capital Stock (other than common stock) of such Person, (h) all Guarantee
Obligations of such Person in respect of obligations of the kind referred
to in clauses (a) through (g) above; (i) all obligations of the kind
referred to in clauses (a) through (h) above secured by (or for which the
holder of such obligation has an existing right, contingent or otherwise,
to be secured by) any Lien on Property (including, without limitation,
accounts and contract rights) owned by such Person, whether or not such
Person has assumed or become liable for the payment of such obligation (for
purposes of calculating the amount of indebtedness referred to in this
clause (i) the amount of indebtedness shall be limited to the value of such
Property) and (j) for the purposes of Section 8(e) only, all obligations of
such Person in respect of Interest Rate Protection Agreements and (k) the
liquidation value of any preferred Capital Stock of such Person or its
Subsidiaries (i) held by any Person other than such Person and its Wholly
Owned Subsidiaries and (ii) providing for any scheduled or mandatory
payment, redemption or sinking fund prior to one year after the Maturity
Date.
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Intellectual Property": the collective reference to all rights,
priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including, without limitation, copyrights, copyright licenses, patents,
patent licenses, trademarks, trademark licenses, technology, and all rights
to ▇▇▇ at law or in equity for any infringement or other impairment
thereof, including the right to receive all proceeds and damages therefrom.
"Interest Payment Date": (a) as to any Base Rate Loan, the last day
of each March, June, September and December to occur while such Loan is
outstanding and the final maturity date of such Loan, (b) as to any
Eurodollar Loan, the last day of such Interest Period and (c) as to any
Loan (other than any Revolving Credit Loan that is a Base Rate Loan), the
date of any repayment or prepayment made in respect thereof.
"Interest Period": as to any Eurodollar Loan, (a) initially, the
period commencing on the borrowing or conversion date, as the case may be,
with respect to such Eurodollar Loan and ending one month thereafter; and
(b) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurodollar Loan and ending one
month thereafter; provided that, all of the foregoing provisions relating
to Interest Periods are subject to the following:
12
(i) if any Interest Period would otherwise end on a day that is
not a Business Day, such 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;
(ii) any Interest Period that would otherwise extend beyond the
Revolving Credit Termination Date or beyond the date final payment is
due on the Term Loans, as the case may be, shall end on the Revolving
Credit Termination Date or such due date, as applicable; and
(iii) any Interest Period that begins on the last Business Day
of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month.
"Interest Rate Protection Agreement": any interest rate protection
agreement, interest rate futures contract, interest rate option, interest
rate cap or other interest rate hedge arrangement, to or under which the
Borrower or any of its Subsidiaries is a party or a beneficiary on the date
hereof or becomes a party or a beneficiary after the date hereof.
"Issuing Lender": ▇▇▇▇▇▇ Commercial Paper Inc., in its capacity as
issuer of any Letter of Credit.
"L/C Commitment": $10,000,000.
"L/C Fee Payment Date": the last day of each March, June, September
and December and the Revolving Credit Termination Date.
"L/C Obligations": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters
of Credit and (b) the aggregate amount of drawings under Letters of Credit
which have not then been reimbursed pursuant to Section 3.5.
"L/C Participants": the collective reference to all the Revolving
Credit Lenders other than the Issuing Lender.
"Lenders": as defined in the preamble hereto.
"Letters of Credit": as defined in Section 3.1(a).
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference, priority or other security agreement
or preferential arrangement of any kind or nature
13
whatsoever, whether or not filed, recorded or otherwise perfected under
applicable law (including, without limitation, any conditional sale or
other title retention agreement and any capital lease having substantially
the same economic effect as any of the foregoing and any filing of or
agreement to give any financing statement under the Uniform Commercial Code
(or equivalent statutes) of any jurisdiction).
"Loan": any loan made by any Lender pursuant to this Agreement.
"Loan Documents": this Agreement, the Security Documents, the
Syndication Letter and the Notes.
"Loan Parties": the Borrower and each Subsidiary of the Borrower
which is a party to a Loan Document.
"Loan Percentage": as to any Lender at any time, the percentage which
such Lender's Commitment then constitutes of the aggregate Commitments (or,
at any time after the Tender Funding Date, the percentage which the
aggregate principal amount of such Lender's Revolving Credit Commitments
(or, if the Revolving Credit Commitments have been terminated, such
Lender's Revolving Extensions of Credit) and Term Loans then outstanding
constitutes of the aggregate principal amount of the Revolving Credit
Commitments (or, if the Revolving Credit Commitments have been terminated,
the Total Revolving Extensions of Credit) and Term Loans then outstanding).
"Majority Facility Lenders": with respect to any Facility, the
holders of more than 50% of the aggregate unpaid principal amount of the
Term Loans or the Total Revolving Extensions of Credit, as the case may be,
outstanding under such Facility (or, in the case of the Revolving Credit
Facility, prior to any termination of the Revolving Credit Commitments, the
holders of more than 50% of the Total Revolving Credit Commitments).
"Majority Revolving Credit Facility Lenders": the Majority Facility
Lenders in respect of the Revolving Credit Facility.
"Margin Stock": as defined in Regulation U.
"Margin Stock Collateral": all Margin Stock of the Borrower and its
Subsidiaries by which the Loans are secured pursuant to the Security
Documents or are deemed "indirectly secured" within the meaning of
Regulation U.
"Material Adverse Effect": a material adverse effect on (a) the
Acquisition, (b) the business, assets, property, operations, liabilities
(including, without limitation, contingent liabilities), or condition
(financial or otherwise) of the Borrower, the Target or their respective
Subsidiaries taken as a whole, (c) the consummation of the Tender Offer or
the Merger or (d) the validity or enforceability of this Agreement or any
of the other Loan
14
Documents or the rights or remedies of the Agents or the Lenders hereunder
or thereunder which materially affects the benefits intended to be bestowed
thereunder.
"Material Environmental Amount": an amount payable by the Borrower
and/or its Subsidiaries in excess of $10,000,000 in any individual
circumstance, or at the time of any determination, $15,000,000 in the
aggregate at any such time for remedial costs, compliance costs,
compensatory damages, punitive damages, fines, penalties or any combination
thereof.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products,
polychlorinated biphenyls, urea-formaldehyde insulation, asbestos,
pollutants, contaminants, radioactivity, and any other substance that is
regulated pursuant to or could give rise to liability under any
Environmental Law or common law.
"Maturity Date": the earliest to occur of (i) the date of the
consummation of the Merger, and (ii) January 15, 1998.
"Merger": as defined in the recitals hereto.
"Merger Agreement": as defined in the recitals hereto.
"Mortgaged Properties": the real properties listed on Schedule 1.1B,
as to which the Administrative Agent for the benefit of the Lenders shall
be granted a Lien pursuant to the Mortgages.
"Mortgages": each of the mortgages and deeds of trust made by any
Loan Party in favor of, or for the benefit of, the Administrative Agent for
the benefit of the Lenders, substantially in the form of Exhibit D (with
such changes thereto as shall be advisable under the law of the
jurisdiction in which such mortgage or deed of trust is to be recorded), as
the same may be amended, supplemented or otherwise modified from time to
time.
"Multiemployer Plan": a Plan which is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.
"Non-Excluded Taxes": as defined in Section 2.16(a).
"Non-U.S. Lender": as defined in Section 2.16(d).
"Notes": the collective reference to any promissory note evidencing
Loans.
"Notice of Borrowing": (i) with respect to (a) any borrowing of
Loans, a Notice of Borrowing (Drawings), substantially in the form of
Exhibit K-1, (b) any conversion of Loans, a Notice of Borrowing
(Conversions), substantially in the form of Exhibit K-2 and
15
(c) any continuation of Eurodollar Loans, a Notice of Borrowing
(Continuations), substantially in the form of Exhibit K-3 or (ii)
telephonic notice of any such borrowing, conversion or continuation
promptly confirmed in writing (in a form reasonably acceptable to the
Administrative Agent).
"Obligations": the unpaid principal of and interest on (including,
without limitation, interest accruing after the maturity of the Loans and
Reimbursement Obligations and interest accruing after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or not
a claim for post-filing or post-petition interest is allowed in such
proceeding) the Loans and all other obligations and liabilities of the
Borrower to the Administrative Agent or to any Lender (or, in the case of
Interest Rate Protection Agreements, any Affiliate of any Lender), whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in
connection with, this Agreement, any other Loan Document, the Letters of
Credit, any Interest Rate Protection Agreement entered into with any Lender
or any Affiliate of any Lender or any other document made, delivered or
given in connection herewith or therewith, whether on account of principal,
interest, reimbursement obligations, fees, indemnities, costs, expenses
(including, without limitation, all fees, charges and disbursements of
counsel to the Administrative Agent or to any Lender that are required to
be paid by the Borrower pursuant hereto) or otherwise.
"Offer to Purchase": as defined in the recitals hereto.
"Other Collateral": all assets of the Borrower and its Subsidiaries
(other than Margin Stock) by which the Loans are secured pursuant to the
Security Documents or are deemed "indirectly secured" within the meaning of
Regulation U.
"Other Taxes": any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies
arising from any payment made hereunder or from the execution, delivery or
enforcement of, or otherwise with respect to, this Agreement.
"Participant": as defined in Section 10.6(b).
"Payment Office": the office specified from time to time by the
Administrative Agent as its payment office by notice to the Borrower and
the Lenders.
"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).
"Permitted Investors": the collective reference to the Persons listed
on Schedule 1.1C, and their respective Control Investment Affiliates.
16
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of
whatever nature.
"Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would
under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Pro Forma Balance Sheets": as defined in Section 4.1(a).
"Projections": as defined in Section 6.2(c).
"Properties": as defined in Section 4.16.
"Property": any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or
intangible, including, without limitation, Capital Stock.
"Reference Lender": Administrative Agent.
"Register": as defined in Section 10.6(d).
"Regulation G": Regulation G of the Board as in effect from time to
time.
"Regulation U": Regulation U of the Board as in effect from time to
time.
"Regulation T": Regulation T of the Board as in effect from time to
time.
"Regulation X": Regulation X of the Board as in effect from time to
time.
"Reimbursement Obligation": the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn
under Letters of Credit.
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC Reg. (S)
2615.
"Required Lenders": the holders of more than 50% of (a) until the
Tender Funding Date, the Commitments and (b) thereafter, the sum of (i) the
aggregate unpaid principal amount of the Term Loans and (ii) the Total
Revolving Credit Commitments or, if the
17
Revolving Credit Commitments have been terminated, the Total Revolving
Extensions of Credit.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its Property or to
which such Person or any of its Property is subject.
"Responsible Officer": the chief executive officer, president or
chief financial officer of the Borrower, but in any event, with respect to
financial matters, the chief financial officer of the Borrower.
"Revolving Credit Commitment": as to any Lender, the obligation of
such Lender, if any, to make Revolving Credit Loans and participate in
Letters of Credit, in an aggregate principal and/or face amount not to
exceed the amount set forth under the heading "Revolving Credit Commitment"
opposite such Lender's name on Schedule 1.1A, as the same may be changed
from time to time pursuant to the terms hereof. The original amount of the
Total Revolving Credit Commitments is $210,000,000.
"Revolving Credit Commitment Period": the period from and including
the Closing Date to the Revolving Credit Termination Date.
"Revolving Credit Lender": each Lender which has a Revolving Credit
Commitment or which has made Revolving Credit Loans.
"Revolving Credit Loans": as defined in Section 2.4.
"Revolving Credit Percentage": as to any Revolving Credit Lender at
any time, the percentage which such Lender's Revolving Credit Commitment
then constitutes of the Total Revolving Credit Commitments (or, at any time
after the Revolving Credit Commitments shall have expired or terminated,
the percentage which the aggregate principal amount of such Lender's
Revolving Credit Loans then outstanding constitutes of the aggregate
principal amount of the Revolving Credit Loans then outstanding).
"Revolving Credit Termination Date": the earlier of (a) the Maturity
Date and (b) the date on which the Term Loans shall be paid in full.
"Revolving Extensions of Credit": as to any Revolving Credit Lender
at any time, an amount equal to the sum of (a) the aggregate principal
amount of all Revolving Credit Loans made by such Lender then outstanding
and (b) such Lender's Revolving Credit Percentage of the L/C Obligations
then outstanding.
"SEC": the Securities and Exchange Commission (or successors thereto
or an analogous Governmental Authority).
18
"Security Documents": the collective reference to the Guarantee and
Collateral Agreement, the Mortgages, the Target Pledge Agreement, the
Control Agreement and all other security documents hereafter delivered to
the Administrative Agent granting a Lien on any Property of any Person to
secure the obligations and liabilities of any Loan Party under any Loan
Document.
"Senior Note Indenture": the Indenture, dated as of October 15, 1992,
between the Borrower and Texas Commerce Bank National Association, as
trustee (as the same may be amended, supplemented or otherwise modified
from time to time), pursuant to which the Senior Notes were issued.
"Senior Notes": the 8-3/8% Senior Notes Due October 15, 1999, issued
by the Borrower.
"Shares": as defined in the recitals hereto.
"Single Employer Plan": any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
"Solvent": when used with respect to any Person, means that, as of
any date of determination, (a) the amount of the "present fair saleable
value" of the assets of such Person will, as of such date, exceed the
amount of all "liabilities of such Person, contingent or otherwise", as of
such date, as such quoted terms are determined in accordance with
applicable Federal and state laws governing determinations of the
insolvency of debtors, (b) the present fair saleable value of the assets of
such Person will, as of such date, be greater than the amount that will be
required to pay the liability of such Person on its debts as such debts
become absolute and matured, (c) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its
business, and (d) such Person will be able to pay its debts as they mature.
"Specified Number of Shares": as defined in the recitals hereto.
"Specified Change of Control": a "change of control" shall occur as
defined in the Senior Note Indenture, as amended, supplemented or otherwise
modified from time to time.
"Stockholders Agreement": the Stockholders Agreement, dated as of
September 12, 1997, among IHK Merger Sub, Imperial ▇▇▇▇▇ and each of the
executive officers and directors of the Target, pursuant to which each such
stockholder has agreed to tender all Shares owned by such stockholder into
the Tender Offer.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such
other ownership interests having such power only by reason of the happening
of a contingency) to elect a majority of the board
19
of directors or other managers of such corporation, partnership or other
entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or
both, by such Person. Unless otherwise qualified, all references to a
"Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a
Subsidiary or Subsidiaries of the Borrower and shall not include the Target
or its Subsidiaries.
"Subsidiary Guarantor": each Subsidiary of the Borrower (other than
any Excluded Foreign Subsidiary, the Target and its Subsidiaries and those
Subsidiaries listed on Schedule 1.1D) that guarantees the Obligations
pursuant to the Guarantee and Collateral Agreement.
"Syndication Letter": the letter agreement, dated as of October 17,
1997, between the Borrower and the Syndication Agent relating to the
syndication of the Facilities.
"Target": as defined in the recitals hereto.
"Target Pledge Agreement": the Target Pledge Agreement to be executed
by the Borrower, substantially in the form of Exhibit I, as the same may be
amended, supplemented or otherwise modified from time to time.
"Tender Funding Date": as defined in Section 2.2.
"Tender Offer": as defined in the recitals hereto.
"Tender Offer Purchase": as defined in the recitals hereto.
"Term Loan Lender": each Lender which has a Term Loan Commitment or
which has made a Term Loan.
"Term Loan": as defined in Section 2.1.
"Term Loan Commitment": as to any Lender, the obligation of such
Lender, if any, to make a Term Loan to the Borrower hereunder in a
principal amount not to exceed the amount set forth under the heading "Term
Loan Commitment" opposite such Lender's name on Schedule 1.1A. The
original aggregate amount of the Term Loan Commitments is $295,000,000.
"Term Loan Percentage": as to any Term Loan Lender at any time, the
percentage which such Lender's Term Loan Commitment then constitutes of the
aggregate Term Loan Commitments (or, at any time after the Tender Funding
Date, the percentage which the aggregate principal amount of such Lender's
Term Loans then outstanding constitutes of the aggregate principal amount
of the Term Loans then outstanding).
20
"Total Revolving Credit Commitments": at any time, the aggregate
amount of the Revolving Credit Commitments at such time.
"Total Revolving Extensions of Credit": at any time, the aggregate
amount of the Revolving Extensions of Credit of the Revolving Credit
Lenders at such time.
"Transaction Documentation": collectively, the Merger Agreement, the
Offer to Purchase (including all documents and materials filed with the SEC
in connection therewith) and all documentation executed in connection with
the Debt Tender Offer and the other transactions contemplated thereby, in
each case, including all schedules, exhibits, certificates, documents and
agreements entered into, executed or delivered in connection therewith, and
as each such agreement, filing, schedule, exhibit, certificate or document
may be amended, supplemented or otherwise modified from time to time in
accordance with Section 7.15.
"Transferee": as defined in Section 10.15.
"Type": as to any Loan, its nature as a Base Rate Loan or a
Eurodollar Loan.
"Uniform Customs": the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No.
500, as the same may be amended from time to time.
"Wholly Owned Subsidiary": as to any Person, any other Person all of
the Capital Stock of which (other than directors' qualifying shares
required by law) is owned by such Person directly and/or through other
Wholly Owned Subsidiaries.
"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that is
a Wholly Owned Subsidiary of the Borrower.
1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the other Loan Documents or any certificate or other document made
or delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms relating to the Borrower and its Subsidiaries not defined in
Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
21
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Term Loan Commitments. Subject to the terms and conditions
hereof, each Term Loan Lender severally agrees to make a term loan (a "Term
Loan") to the Borrower on the Tender Funding Date in an amount not to exceed the
amount of the Term Loan Commitment of such Lender. The Term Loans may from time
to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower
and notified to the Administrative Agent in accordance with Sections 2.2 and
2.9.
2.2 Procedure for Term Loan Borrowing. The Borrower shall give the
Administrative Agent irrevocable Notice of Borrowing (which notice must be
received by the Administrative Agent one Business Day prior to the anticipated
funding of the Term Loans (the "Tender Funding Date"), in the case of Base Rate
Loans) requesting that the Term Loan Lenders make the Term Loans on the Tender
Funding Date and specifying the amount to be borrowed. The Term Loans made on
the Tender Funding Date shall initially be Base Rate Loans and no Term Loan may
be converted into or continued as a Eurodollar Loan if the last day of the
Interest Period with respect thereto would occur on or after the Maturity Date.
Upon receipt of such notice the Administrative Agent shall promptly notify each
Term Loan Lender thereof. Not later than 12:00 noon, New York City time, on the
Tender Funding Date each Term Loan Lender shall make available to the
Administrative Agent at the Funding Office an amount in immediately available
funds equal to the Term Loan or Term Loans to be made by such Lender. The
Administrative Agent shall make available to the Borrower the aggregate of the
amounts made available to the Administrative Agent by the Term Loan Lenders in
immediately available funds not later than 2:00 P.M., New York City time, on the
Tender Funding Date.
2.3 Revolving Credit Commitments. (a) Subject to the terms and
conditions hereof, each Revolving Credit Lender severally agrees to make
revolving credit loans ("Revolving Credit Loans") to the Borrower from time to
time during the Revolving Credit Commitment Period in an aggregate principal
amount at any one time outstanding which, when added to such Lender's Revolving
Credit Percentage of the L/C Obligations then outstanding does not exceed the
amount of such Lender's Revolving Credit Commitment. During the Revolving
Credit Commitment Period the Borrower may use the Revolving Credit Commitments
by borrowing, prepaying the Revolving Credit Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof. The
Revolving Credit Loans may from time to time be Eurodollar Loans or Base Rate
Loans, as determined by the Borrower and notified to the Administrative Agent in
accordance with Sections 2.4 and 2.9, provided that no Revolving Credit Loan
shall be made as a Eurodollar Loan if the last day of the Interest Period with
respect thereto would occur on or after the Revolving Credit Termination Date.
(b) The Borrower shall repay all outstanding Revolving Credit Loans
on the Revolving Credit Termination Date.
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2.4 Procedure for Revolving Credit Borrowing. The Borrower may
borrow under the Revolving Credit Commitments during the Revolving Credit
Commitment Period on any Business Day, provided that the Borrower shall give the
Administrative Agent irrevocable Notice of Borrowing (which notice must be
received by the Administrative Agent prior to 12:00 Noon, New York City time,
(a) three Business Days prior to the requested Borrowing Date, in the case of
Eurodollar Loans, or (b) 12:00 noon New York City time on the day of the
requested Borrowing Date, in the case of Base Rate Loans), specifying (i) the
amount and Type of Revolving Credit Loans to be borrowed and (ii) the requested
Borrowing Date. Any Revolving Credit Loans made on the Closing Date shall
initially be Base Rate Loans and no Revolving Credit Loan may be made as,
converted into or continued as a Eurodollar Loan if the last day of the Interest
Period with respect thereto would occur on or after the Revolving Credit
Termination Date. Each borrowing under the Revolving Credit Commitments shall
be in an amount equal to (x) in the case of Base Rate Loans, $100,000 or a whole
multiple thereof (or, if the then aggregate Available Revolving Credit
Commitments are less than $100,000, such lesser amount) and (y) in the case of
Eurodollar Loans, $1,000,000 or a whole multiple thereof. Upon receipt of any
such notice from the Borrower, the Administrative Agent shall promptly notify
each Revolving Credit Lender thereof. Each Revolving Credit Lender will make
the amount of its Revolving Credit Percentage of each borrowing available to the
Administrative Agent for the account of the Borrower at the Funding Office prior
to 1:00 P.M., New York City time, on the Borrowing Date requested by the
Borrower in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the Administrative
Agent in like funds as received by the Administrative Agent as soon as
practicable, in accordance with the Administrative Agent's normal practice,
after receipt thereof from the Lenders.
2.5 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby
unconditionally promises to pay to the Administrative Agent for the account of
the appropriate Revolving Credit Lender or Term Loan Lender, as the case may be,
(i) the then unpaid principal amount of each Revolving Credit Loan of such
Revolving Credit Lender on the Revolving Credit Termination Date (or such
earlier date on which the Loans become due and payable pursuant to Section 8)
and (ii) the principal amount of each Term Loan of such Term Loan Lender on the
Maturity Date (or on such earlier date on which the Loans become due and payable
pursuant to Section 8). The Borrower hereby further agrees to pay interest on
the unpaid principal amount of the Loans from time to time outstanding from the
date hereof until payment in full thereof at the rates per annum, and on the
dates, set forth in Section 2.11.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Loan of such Lender from time to time, including the amounts
of principal and interest payable and paid to such Lender from time to time
under this Agreement.
(c) The Administrative Agent, on behalf of the Borrower, shall
maintain the Register pursuant to Section 10.6(e), and a subaccount therein for
each Lender, in which shall be recorded (i) the amount of each Loan made
hereunder and any Note evidencing such Loan, the Type thereof and each Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender
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hereunder and (iii) both the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender's share thereof.
(d) The entries made in the Register and the accounts of each Lender
maintained pursuant to Section 2.5(b) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
such Borrower by such Lender in accordance with the terms of this Agreement.
(e) The Borrower agrees that, upon the request to the Administrative
Agent by any Lender, the Borrower will execute and deliver to such Lender a
promissory note of the Borrower evidencing any Term Loans or Revolving Credit
Loans, as the case may be, of such Lender, substantially in the forms of Exhibit
G-1 or G-2, respectively, with appropriate insertions as to date and principal
amount.
2.6 Commitment Fees, etc. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender, a commitment fee for the
period from and including the Closing Date to the Revolving Credit Termination
Date, computed at the Commitment Fee Rate on the average daily amount of the
Available Commitment of such Lender during the period for which payment is made,
payable quarterly in arrears on the last day of each March, June, September and
December and on the Revolving Credit Termination Date, commencing on the first
of such dates to occur after the date hereof.
(b) The Borrower agrees to pay to the Syndication Agent the fees in
the amounts and on the dates previously agreed to in writing by the Borrower and
the Syndication Agent.
(c) The Borrower agrees to pay to the Administrative Agent the fees
in the amounts and on the dates from time to time agreed to in writing by the
Borrower and the Administrative Agent.
2.7 Termination or Reduction of Revolving Credit Commitments. The
Borrower shall have the right, upon not less than two Business Days' notice to
the Administrative Agent, to terminate the Revolving Credit Commitments or, from
time to time, to reduce the amount of the Revolving Credit Commitments; provided
that no such termination or reduction of Revolving Credit Commitments shall be
permitted if, after giving effect thereto and to any prepayments of the
Revolving Credit Loans made on the effective date thereof, the Total Revolving
Extensions of Credit would exceed the Total Revolving Credit Commitments. Any
such reduction shall be in an amount equal to $1,000,000, or a whole multiple
thereof, and shall reduce permanently the Revolving Credit Commitments then in
effect.
2.8 Optional Prepayments. The Borrower may at any time and from time
to time prepay the Loans, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Administrative Agent at least three Business
Days prior thereto in the case of
24
Eurodollar Loans and at least one Business Day prior thereto in the case of Base
Rate Loans, which notice shall specify the date and amount of prepayment and
whether the prepayment is of Eurodollar Loans or Base Rate Loans; provided, that
if a Eurodollar Loan is prepaid on any day other than the last day of the
Interest Period applicable thereto, the Borrower shall also pay any amounts
owing pursuant to Section 2.17. Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with (except in the case of
Revolving Credit Loans which are Base Rate Loans) accrued interest to such date
on the amount prepaid. Partial prepayments of Term Loans and Revolving Credit
Loans shall be in an aggregate principal amount of $1,000,000 or a whole
multiple thereof.
2.9 Conversion and Continuation Options. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to Base Rate Loans by giving the
Administrative Agent at least two Business Days' prior irrevocable Notice of
Borrowing of such election, provided that any such conversion of Eurodollar
Loans may only be made on the last day of an Interest Period with respect
thereto. The Borrower may elect from time to time to convert Base Rate Loans to
Eurodollar Loans by giving the Administrative Agent at least three Business
Days' prior irrevocable notice of such election, provided that no Base Rate Loan
under a particular Facility may be converted into a Eurodollar Loan (i) when any
Event of Default has occurred and is continuing and the Administrative Agent or
the Majority Facility Lenders in respect of such Facility have determined in its
or their sole discretion not to permit such conversions or (ii) after the date
that is one month prior to the final scheduled termination or maturity date of
such Facility. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.
(b) Any Eurodollar Loan may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the Borrower giving
irrevocable Notice of Borrowing to the Administrative Agent, in accordance with
the applicable provisions of the term "Interest Period" set forth in Section
1.1, provided that no Eurodollar Loan under a particular Facility may be
continued as such (i) when any Event of Default has occurred and is continuing
and the Administrative Agent has or the Majority Facility Lenders in respect of
such Facility have determined in its or their sole discretion not to permit such
continuations or (ii) after the date that is one month prior to the final
scheduled termination or maturity date of such Facility, and provided, further,
that if the Borrower shall fail to give any required notice as described above
in this paragraph or if such continuation is not permitted pursuant to the
preceding proviso such Loans shall be automatically converted to Base Rate Loans
on the last day of such then expiring Interest Period. Upon receipt of any such
notice the Administrative Agent shall promptly notify each relevant Lender
thereof.
2.10 Minimum Amounts and Maximum Number of Eurodollar Tranches.
Notwithstanding anything to the contrary in this Agreement, all borrowings,
conversions, continuations and optional prepayments of Eurodollar Loans
hereunder and all selections of Interest Periods hereunder shall be in such
amounts and be made pursuant to such elections so that, (a) after giving effect
thereto, the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to $1,000,000 or a whole multiple of
25
$1,000,000 in excess thereof and (b) no more than ten Eurodollar Tranches shall
be outstanding at any one time.
2.11 Interest Rates and Payment Dates. (a) Each Eurodollar Loan
shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such day
plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest at a rate per annum equal
to the Base Rate plus the Applicable Margin.
(c) (i) If all or a portion of the principal amount of any Loan or
Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), all of such outstanding Loans and
Reimbursement Obligations shall bear interest at a rate per annum which is equal
to (x) in the case of the Loans, the rate that would otherwise be applicable
thereto pursuant to the foregoing provisions of this Section 2.11 plus 2% or (y)
in the case of Reimbursement Obligations, the rate applicable to Base Rate Loans
under the Revolving Credit Facility plus 2%, and (ii) if all or a portion of any
interest payable on any Loan or Reimbursement Obligation or any commitment fee
or other amount payable hereunder shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall bear
interest at a rate per annum equal to the rate applicable to Base Rate Loans
under the relevant Facility plus 2% (or, in the case of any such other amounts
that do not relate to a particular Facility, the Base Rate plus 4%), in each
case, with respect to clauses (i) and (ii) above, from the date of such non-
payment until such amount is paid in full (as well after as before judgment).
(d) Interest shall be payable in arrears on each Interest Payment
Date, provided that interest accruing pursuant to paragraph (c) of this Section
2.11 shall be payable from time to time on demand.
2.12 Computation of Interest and Fees. (a) Interest, fees and
commissions payable pursuant hereto shall be calculated on the basis of a 360-
day year for the actual days elapsed, except that, with respect to Base Rate
Loans the rate of interest on which is calculated on the basis of the Prime
Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-,
as the case may be) day year for the actual days elapsed. The Administrative
Agent shall as soon as practicable notify the Borrower and the relevant Lenders
of each determination of a Eurodollar Rate. Any change in the interest rate on
a Loan resulting from a change in the Base Rate or the Eurocurrency Reserve
Requirements shall become effective as of the opening of business on the day on
which such change becomes effective. The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of the effective date
and the amount of each such change in interest rate.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the
26
Borrower, deliver to the Borrower a statement showing the quotations used by the
Administrative Agent in determining any interest rate pursuant to Section
2.11(a).
2.13 Inability to Determine Interest Rate. If prior to the first day
of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by
reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for such
Interest Period, or
(b) the Administrative Agent shall have received notice from the
Majority Facility Lenders in respect of the relevant Facility that the
Eurodollar Rate determined or to be determined for such Interest Period
will not adequately and fairly reflect the cost to such Lenders (as
conclusively certified by such Lenders) of making or maintaining their
affected Loans during such Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans under the relevant Facility requested
to be made on the first day of such Interest Period shall be made as Base Rate
Loans, (y) any Loans under the relevant Facility that were to have been
converted on the first day of such Interest Period to Eurodollar Loans shall be
continued as Base Rate Loans and (z) any outstanding Eurodollar Loans under the
relevant Facility shall be converted, on the first day of such Interest Period,
to Base Rate Loans. Until such notice has been withdrawn by the Administrative
Agent which notice shall be withdrawn promptly upon notice to the Administrative
Agent confirming the termination of the events precipitating same, no further
Eurodollar Loans under the relevant Facility shall be made or continued as such,
nor shall the Borrower have the right to convert Loans under the relevant
Facility to Eurodollar Loans.
2.14 Pro Rata Treatment and Payments. (a) Each borrowing by the
Borrower from the Lenders hereunder, each payment by the Borrower on account of
any commitment fee and any reduction of the Commitments of the Lenders shall be
made pro rata according to the respective Term Loan Percentages or Revolving
Credit Percentages, as the case may be, of the relevant Lenders.
(b) Each payment (including each prepayment) by the Borrower on
account of principal of and interest on the Term Loans shall be made pro rata
according to the respective outstanding principal amounts of the Term Loans then
held by the Term Loan Lenders. Amounts prepaid on account of the Term Loans may
not be reborrowed.
(c) Each payment (including each prepayment) by the Borrower on
account of principal of and interest on the Revolving Credit Loans shall be made
pro rata according to the respective outstanding principal amounts of the
Revolving Credit Loans then held by the Revolving Credit Lenders.
27
(d) All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without setoff or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent, for the
pro rata account of the Lenders, at the Payment Office, in Dollars and in
immediately available funds. The Administrative Agent shall distribute such
payments to the Lenders promptly upon receipt in like funds as received. If any
payment hereunder (other than payments on the Eurodollar Loans) becomes due and
payable on a day other than a Business Day, such payment shall be extended to
the next succeeding Business Day. If any payment on a Eurodollar Loan becomes
due and payable on a day other than a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day unless the result of such
extension would be to extend such payment into another calendar month, in which
event such payment shall be made on the immediately preceding Business Day. In
the case of any extension of any payment of principal pursuant to the preceding
two sentences, interest thereon shall be payable at the then applicable rate
during such extension.
(e) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the
Administrative Agent by the required time on the Borrowing Date therefor, such
Lender shall pay to the Administrative Agent, on demand, such amount with
interest thereon at a rate equal to the daily average Federal Funds Effective
Rate for the period until such Lender makes such amount immediately available to
the Administrative Agent. A certificate of the Administrative Agent submitted
to any Lender with respect to any amounts owing under this Section 2.14(e) shall
be conclusive in the absence of manifest error. If such Lender's share of such
borrowing is not made available to the Administrative Agent by such Lender
within three Business Days of such Borrowing Date, the Administrative Agent
shall also be entitled to recover such amount with interest thereon at the rate
per annum applicable to Base Rate Loans under the relevant Facility, on demand,
from the Borrower.
(f) Unless the Administrative Agent shall have been notified in
writing by the Borrower prior to the date of any payment being made hereunder
that the Borrower will not make such payment to the Administrative Agent, the
Administrative Agent may assume that the Borrower is making such payment, and
the Administrative Agent may, but shall not be required to, in reliance upon
such assumption, make available to the Lenders their respective pro rata shares
of a corresponding amount. If such payment is not made to the Administrative
Agent by the Borrower within three Business Days of such required date, the
Administrative Agent shall be entitled to recover, on demand, from each Lender
to which any amount which was made available pursuant to the preceding sentence,
such amount with interest thereon at the rate per annum equal to the daily
average Federal Funds Effective Rate. Nothing herein shall be deemed to limit
the rights of the Administrative Agent or any Lender against the Borrower.
28
2.15 Requirements of Law. (a) If the adoption of or any change in
any Requirement of Law or in the interpretation or application thereof or
compliance by any Lender with any request or directive (whether or not having
the force of law) from any central bank or other Governmental Authority in all
cases made subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever
with respect to this Agreement, any Letter of Credit, any Application or
any Eurodollar Loan made by it, or change the basis of taxation of payments
to such Lender in respect thereof (except for Non-Excluded Taxes covered by
Section 2.16 and changes in the rate of tax on the overall net income of
such Lender);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets held
by, deposits or other liabilities in or for the account of, advances, loans
or other extensions of credit by, or any other acquisition of funds by, any
office of such Lender which is not otherwise included in the determination
of the Eurodollar Rate hereunder; or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable. If any Lender becomes
entitled to claim any additional amounts pursuant to this Section 2.15, it shall
promptly notify the Borrower (with a copy to the Administrative Agent) of the
event by reason of which it has become so entitled.
(b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority in all cases made subsequent to the date hereof shall have the effect
of reducing the rate of return on such Lender's or such corporation's capital as
a consequence of its obligations hereunder or under or in respect of any Letter
of Credit to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy)
by an amount deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrower (with a copy to the Administrative
Agent) of a written request therefor, the Borrower shall promptly pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction.
(c) A certificate as to any additional amounts payable pursuant to
this Section 2.15 shall be submitted by the relevant Lender to the Borrower
(with a copy to the Administrative Agent) and shall set forth in detail the
reason for such compensation together with a computation
29
of the amount claimed shall be conclusive in the absence of manifest error. The
obligations of the Borrower pursuant to this Section 2.15 shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder for a period of one year.
2.16 Taxes. (a) All payments made by the Borrower under this
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on any Agent or any Lender as a result of a present or
former connection between such Agent or such Lender and the jurisdiction of the
Governmental Authority imposing such tax or any political subdivision or taxing
authority thereof or therein (other than any such connection arising solely from
such Agent or such Lender having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any
other Loan Document). If any such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings ("Non-Excluded Taxes") or Other Taxes
are required to be withheld from any amounts payable to any Agent or any Lender
hereunder, the amounts so payable to such Agent or such Lender shall be
increased to the extent necessary to yield to such Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement, provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender with respect to any Non-Excluded
Taxes (i) that are attributable to such Lender's failure to comply with the
requirements of paragraph (d) or (e) of this subsection or (ii) that are United
States withholding taxes imposed on amounts payable to such Lender at the time
the Lender becomes a party to this Agreement, except to the extent that such
Lender's assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such Non-Excluded Taxes
pursuant to Section 2.16(a).
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law upon receipt
of a written request complying with Section 2.15(c).
(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for the account of the relevant Agent or Lender, as the
case may be, a certified copy of an original official receipt received by the
Borrower showing payment thereof. If the Borrower fails to pay any Non-Excluded
Taxes or Other Taxes when due to the appropriate taxing authority or fails to
remit to the Agents the required receipts or other required documentary
evidence, the Borrower shall indemnify the Administrative Agent and the Lenders
for any incremental taxes, interest or penalties that may become payable by any
Agent or any Lender as a result of any such failure. The agreements in this
Section 2.16 shall survive the termination of this Agreement and the payment of
the Loans and all other amounts payable hereunder for a period of one year.
(d) Each Lender (or Transferee) that is not a citizen or resident of
the United States of America, a corporation, partnership or other entity created
or organized in or under the laws
30
of the United States of America (or any jurisdiction thereof), or any estate or
trust that is subject to federal income taxation regardless of the source of its
income (a "Non-U.S. Lender") shall deliver to the Borrower and the
Administrative Agent (or, in the case of a Participant, to the Lender from which
the related participation shall have been purchased) two copies of either U.S.
Internal Revenue Service Form 1001 or Form 4224, or, in the case of a Non-U.S.
Lender claiming exemption from U.S. federal withholding tax under Section 871(h)
or 881(c) of the Code with respect to payments of "portfolio interest" a
statement substantially in the form of Exhibit H and a Form W-8, or any
subsequent versions thereof or successors thereto properly completed and duly
executed by such Non-U.S. Lender claiming complete exemption from, or a reduced
rate of, U.S. federal withholding tax on all payments by the Borrower under this
Agreement and the other Loan Documents. Such forms shall be delivered by each
Non-U.S. Lender on or before the date it becomes a party to this Agreement (or,
in the case of any Participant, on or before the date such Participant purchases
the related participation). In addition, each Non-U.S. Lender shall deliver such
forms promptly upon the obsolescence or invalidity of any form previously
delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify
the Borrower at any time it determines that it is no longer in a position to
provide any previously delivered certificate to the Borrower (or any other form
of certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this Section 2.16(d), a Non-U.S. Lender
shall not be required to deliver any form pursuant to this Section 2.16(d) that
such Non-U.S. Lender is not legally able to deliver.
(e) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which the Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender's reasonable judgment such completion, execution or submission would not
materially prejudice the legal position of such Lender.
2.17 Indemnity. The Borrower agrees to indemnify each Lender and to
hold each Lender harmless from any loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in making a borrowing
of, conversion into or continuation of Eurodollar Loans after the Borrower has
given a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by the Borrower in making any prepayment after the
Borrower has given a notice thereof in accordance with the provisions of this
Agreement or (c) the making of a prepayment of Eurodollar Loans on a day which
is not the last day of an Interest Period with respect thereto. Such
indemnification may include an amount equal to the excess, if any, of (i) the
amount of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included therein, if any)
31
over (ii) the amount of interest (as reasonably determined by such Lender) which
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank eurodollar
market. A certificate as to any amounts payable pursuant to this Section 2.17
submitted to the Borrower by any Lender and shall set forth in detail the reason
for such compensation together with a computation of the amount claimed shall be
conclusive in the absence of manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
2.18 Change of Lending Office; Claims Certificate. (a) Each Lender
agrees that, upon the occurrence of any event giving rise to the operation of
Section 2.15 or 2.16(a) with respect to such Lender, it will, if requested by
the Borrower, use reasonable efforts (subject to overall policy considerations
of such Lender) to designate another lending office for any Loans affected by
such event with the object of avoiding the consequences of such event; provided
that such designation is made on terms that, in the sole judgment of such
Lender, cause such Lender and its lending office(s) to suffer no economic, legal
or regulatory disadvantage, and provided, further, that nothing in this Section
2.18 shall affect or postpone any of the obligations of the Borrower or the
rights of any Lender pursuant to Section 2.15 or 2.16(a).
(b) In the event any Lender gives a notice to the Borrower pursuant
to Section 2.15, or any Lender is one of the Lenders notifying the Agent
pursuant to Section 2.13(d), or is unable to deliver the forms as required by
Section 2.16(d), or with respect to whom the Borrower is required to pay
additional amounts pursuant to Section 2.16 or any Lender is unable to make
Eurodollar Loans or cancels its commitment to make Eurodollar Loans pursuant to
Section 2.20, the Borrower may give notice in response, with copies to the
Administrative Agent, that it wishes to seek one or more financial institutions
to replace such Lender in accordance with the provisions set forth in Section
10.6. Each Lender giving such a notice agrees that, at the request of the
Borrower, it will assign all of its interests thereunder and under the Notes and
the Commitment to a designated Assignee for the full amount then owing to it,
all in accordance with Section 10.6. Thereafter, said assignee shall have all of
the rights hereunder and obligations of the assigning Lender (except as
otherwise expressly set forth herein) and such Lender shall have no further
obligations to the Borrower hereunder.
(c) Any notice given pursuant to this Section 2.18 shall be deemed to
contain a representation by the Lender issuing such notice that: (i) such
Lender has used reasonable efforts to minimize said costs or charges but cannot,
in its sole judgment, do so at reasonable expense, and (ii) the increased costs
and charges are common to substantially all of the comparable loan customers of
such Lender and are not unique to the Borrower.
2.19 Margin Regulations. (a) The Loans made by each Lender shall at
all times be treated for purposes of Regulation G and Regulation U as two
separate extensions of credit (the "A Credit" and the "B Credit" of such Lender
and, collectively, the "A Credits" and the "B Credits"), as follows:
(i) the aggregate amount of the A Credit of such Lender shall
be an amount equal to such Lender's pro rata share (based on the amount of
its Loan Percentage) of the
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maximum loan value (as determined in accordance with Regulation G and
Regulation U), of all Margin Stock Collateral; and
(ii) the aggregate amount of the B Credit of such Lender shall
be an amount equal to such Lender's pro rata share (based on the amount of
its Loan Percentage) of all Loans outstanding hereunder minus such Lender's
A Credit.
In the event that any Margin Stock Collateral is acquired or sold, the amount of
the A Credit of such Lender shall be adjusted (if necessary), including, to the
extent necessary, by prepayment, to an amount equal to such Lender's pro rata
share (based on the amount of its Loan Percentage) of the maximum loan value
(determined in accordance with Regulation G and Regulation U) as of the date of
such acquisition or sale) of the Margin Stock Collateral immediately after
giving effect to such acquisition or sale. Nothing contained in this subsection
2.19(a) shall be deemed to permit any sale of Margin Stock Collateral in
violation of any other provisions of this Agreement.
(b) Each Lender will maintain its records to identify the A Credit of
such Lender and the B Credit of such Lender, and, solely for the purposes of
complying with Regulation G and Regulation U, the A and B Credits shall be
treated as separate extensions of credit. Each Lender hereby represents and
warrants that the loan value of the Other Collateral is sufficient for such
Lender to lend its pro rata share of the B Credit.
(c) The benefits of the direct and indirect security in Margin Stock
Collateral created by any provisions of this Agreement and the other Loan
Documents shall be allocated first to the benefit and security of the payment of
the principal of and interest on the A Credits of the Lenders and of all other
amounts payable by the Borrower under this Agreement in connection with the A
Credits (collectively, the "A Credit Amounts") and second, only after the
payment in full of the A Credit Amounts, to the benefit and security of the
payment of the principal of and interest on the B Credits of the Lenders and of
all other amounts payable by the Borrower under this Agreement in connection
with the B Credits (collectively, the "B Credit Amounts"). The benefits of the
direct and indirect security in Other Collateral created by any provisions of
this Agreement and the other Loan Documents, shall be allocated first to the
benefit and security of the payment of the B Credit Amounts and second, only
after the payment in full of the B Credit Amounts, to the benefit and security
of the payment of the A Credit Amounts.
(d) The Borrower shall furnish to each Lender at the time of each
acquisition and sale of Margin Stock Collateral such information and documents
as the Administrative Agent or such Lender may require to determine the A and B
Credits, and at any time and from time to time, such other information and
documents as the Administrative Agent or such Lender may reasonably require to
determine compliance with Regulation U or Regulation G, as applicable.
(e) Each Lender shall be responsible for its own compliance with and
administration of the provisions of this Section 2.19 and Regulation G and
Regulation U, and the Agents shall have no responsibility for any determinations
or allocations made or to be made by any Lender as required by such provisions.
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2.20 Illegality. Notwithstanding any other provision herein, if the
adoption of or any change in any Requirement of Law or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such
Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be cancelled and (b)
such Lender's Loans then outstanding as Eurodollar Loans, if any, shall be
converted automatically to Base Rate Loans on the respective last days of the
then current Interest Periods with respect to such Loans or within such earlier
period as required by law. If any such conversion of a Eurodollar Loan occurs
on a day which is not the last day of the then current Interest Period with
respect thereto, the Borrower shall pay to such Lender such amounts, if any, as
may be required pursuant to subsection 2.17.
SECTION 3. LETTERS OF CREDIT
3.1 L/C Commitment. (a) Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the other Revolving Credit
Lenders set forth in Section 3.4(a), agrees to issue letters of credit ("Letters
of Credit") for the account of the Borrower on any Business Day during the
Revolving Credit Commitment Period in such form as may be approved from time to
time by the Issuing Lender; provided that the Issuing Lender shall have no
obligation to issue any Letter of Credit if, after giving effect to such
issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the
aggregate amount of the Available Revolving Credit Commitments would be less
than zero. Each Letter of Credit shall (i) be denominated in Dollars and (ii)
expire no later than the date which is five Business Days prior to January 31,
1998.
(b) Each Letter of Credit shall be subject to the Uniform Customs
and, to the extent not inconsistent therewith, the laws of the State of New
York.
(c) The Issuing Lender shall not at any time be obligated to issue
any Letter of Credit hereunder if such issuance would conflict with, or cause
the Issuing Lender or any L/C Participant to exceed any limits imposed by, any
applicable Requirement of Law.
3.2 Procedure for Issuance of Letter of Credit. The Borrower may
from time to time request that the Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender at its address for notices specified herein an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
will process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a
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copy of such Letter of Credit to the Borrower promptly following the issuance
thereof. The Issuing Lender shall promptly furnish to the Administrative Agent,
which shall in turn promptly furnish to the Lenders, notice of the issuance of
each Letter of Credit (including the amount thereof).
3.3 Commissions, Fees and Other Charges. (a) The Borrower will pay
a commission on all outstanding Letters of Credit at a per annum rate equal to
the Applicable Margin then in effect with respect to Eurodollar Loans under the
Revolving Credit Facility, shared ratably among the Revolving Credit Lenders and
payable quarterly in arrears on each L/C Fee Payment Date after the issuance
date.
(b) In addition to the foregoing fees and commissions, the Borrower
shall pay or reimburse the Issuing Lender for such normal and customary costs
and expenses as are incurred or charged by the Issuing Lender in issuing,
negotiating, effecting payment under, amending or otherwise administering any
Letter of Credit.
3.4 L/C Participations. (a) The Issuing Lender irrevocably agrees
to grant and hereby grants to each L/C Participant, and, to induce the Issuing
Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably
agrees to accept and purchase and hereby accepts and purchases from the Issuing
Lender, on the terms and conditions hereinafter stated, for such L/C
Participant's own account and risk an undivided interest equal to such L/C
Participant's Revolving Credit Percentage in the Issuing Lender's obligations
and rights under each Letter of Credit issued hereunder and the amount of each
draft paid by the Issuing Lender thereunder. Each L/C Participant
unconditionally and irrevocably agrees with the Issuing Lender that, if a draft
is paid under any Letter of Credit for which the Issuing Lender is not
reimbursed in full by the Borrower in accordance with the terms of this
Agreement, such L/C Participant shall pay to the Issuing Lender upon demand at
the Issuing Lender's address for notices specified herein an amount equal to
such L/C Participant's Revolving Credit Percentage of the amount of such draft,
or any part thereof, which is not so reimbursed.
(b) If any amount required to be paid by any L/C Participant to the
Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion
of any payment made by the Issuing Lender under any Letter of Credit is paid to
the Issuing Lender within three Business Days after the date such payment is
due, such L/C Participant shall pay to the Issuing Lender on demand an amount
equal to the product of (i) such amount, times (ii the daily average Federal
Funds Effective Rate during the period from and including the date such payment
is required to the date on which such payment is immediately available to the
Issuing Lender, times (ii a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to Section
3.4(a) is not made available to the Issuing Lender by such L/C Participant
within three Business Days after the date such payment is due, the Issuing
Lender shall be entitled to recover from such L/C Participant, on demand, such
amount with interest thereon calculated from such due date at the rate per annum
applicable to Base Rate Loans under the Revolving Credit Facility. A
certificate of the Issuing Lender submitted to any L/C Participant with respect
to any amounts owing under this Section shall be conclusive in the absence of
manifest error.
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(c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with Section 3.4(a), the Issuing Lender
receives any payment related to such Letter of Credit (whether directly from the
Borrower or otherwise, including proceeds of collateral applied thereto by the
Issuing Lender), or any payment of interest on account thereof, the Issuing
Lender will distribute to such L/C Participant its pro rata share thereof;
provided, however, that in the event that any such payment received by the
Issuing Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it.
3.5 Reimbursement Obligation of the Borrower. The Borrower agrees to
reimburse the Issuing Lender on each date on which the Issuing Lender notifies
the Borrower of the date and amount of a draft presented under any Letter of
Credit and paid by the Issuing Lender for the amount of (a) such draft so paid
and (b) any taxes, fees, charges or other costs or expenses incurred by the
Issuing Lender in connection with such payment. Each such payment shall be made
to the Issuing Lender at its address for notices specified herein in lawful
money of the United States of America and in immediately available funds.
Interest shall be payable on any and all amounts remaining unpaid by the
Borrower under this Section from the date such amounts become payable (whether
at stated maturity, by acceleration or otherwise) until payment in full at the
rate set forth in Section 2.11(c). Each drawing under any Letter of Credit
shall (unless an event of the type described in clause (i) or (ii) of Section
8(f) shall have occurred and be continuing with respect to the Borrower, in
which case the procedures specified in Section 3.4 for funding by L/C
Participants shall apply) constitute a request by the Borrower to the
Administrative Agent for a borrowing pursuant to Section 2.4 of Base Rate Loans
in the amount of such drawing. The Borrowing Date with respect to such
borrowing shall be the date of such drawing.
3.6 Obligations Absolute. The Borrower's obligations under this
Section 3 shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment which the
Borrower may have or have had against the Issuing Lender, any beneficiary of a
Letter of Credit or any other Person. The Borrower also agrees with the Issuing
Lender that the Issuing Lender shall not be responsible for, and the Borrower's
Reimbursement Obligations under Section 3.5 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or any dispute between or among the Borrower and any
beneficiary of any Letter of Credit or any other party to which such Letter of
Credit may be transferred or any claims whatsoever of the Borrower against any
beneficiary of such Letter of Credit or any such transferee. The Issuing Lender
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, except for errors or
omissions resulting from the gross negligence or willful misconduct of the
Issuing Lender. The Borrower agrees that any action taken or omitted by the
Issuing Lender under or in connection with any Letter of Credit or the related
drafts or documents, if done in the absence of gross negligence or willful
misconduct and in accordance with the standards or care specified in the
36
Uniform Commercial Code of the State of New York, shall be binding on the
Borrower and shall not result in any liability of the Issuing Lender to the
Borrower.
3.7 Letter of Credit Payments. If any draft shall be presented for
payment under any Letter of Credit, the Issuing Lender shall promptly notify the
Borrower of the date and amount thereof. The responsibility of the Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.
3.8 Applications. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Section 3, the provisions of this Section 3 shall apply.
SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Agents and the Lenders to enter into this Agreement and
to make the Loans and issue or participate in the Letters of Credit, the
Borrower hereby represents and warrants to each Agent and each Lender that:
4.1 Financial Condition. (a) Unaudited pro forma consolidated
balance sheet of the Borrower, IHK Merger Sub, the Target and their consolidated
Subsidiaries as at June 30, 1997 (including the notes thereto) (the "Pro Forma
Balance Sheets"), copies of which have heretofore been furnished to each Lender,
have been prepared giving effect (as if such events had occurred on such date)
to (i) the consummation of the Tender Offer, the Loans to be made on the Closing
Date and the Tender Funding Date and the use of proceeds thereof, and,
separately, (ii) the transactions described in the foregoing clause (i) as well
as the Merger and the financings contemplated by the Alternative A Merger
Facilities or the Alternative B Merger Facilities, as contemplated hereby,
together with, in the case of each of the Pro Forma Balance Sheets, the other
financings and transactions contemplated hereby and the payment of fees and
expenses in connection with the foregoing. The Pro Forma Balance Sheets have
been prepared based on the best information available to the Borrower as of the
date of delivery thereof, and present fairly on a pro forma basis the estimated
financial position of Borrower and its consolidated Subsidiaries as at June 30,
1997, assuming that the events specified in the preceding sentence had actually
occurred at such date and based upon good faith estimates and assumptions
believed by management of the Borrower to be reasonable at the time made, it
being recognized by the Lenders that such financial information as it relates to
future events is not viewed as fact and that actual results during the period or
periods covered by such financial information may differ from the projected
results set forth therein by a material amount .
(b) The audited consolidated balance sheets of the Borrower as at
March 31, 1995, March 31, 1996 and March 31, 1997, and the related consolidated
statements of income and of cash flows for the fiscal years ended on such dates,
reported on by and accompanied by an
37
unqualified report from Deloitte & Touche LLP, present fairly the consolidated
financial condition of the Borrower as at such date, and the consolidated
results of its operations and its consolidated cash flows for the respective
fiscal years then ended. The unaudited consolidated balance sheet of the
Borrower as at June 30, 1997, and the related unaudited consolidated statements
of income and cash flows for the three-month period ended on such date, present
fairly the consolidated financial condition of the Borrower as at such dates,
and the consolidated results of its operations and its consolidated cash flows
for the three-month period then ended (including all adjustments consisting only
of normal recurring accruals necessary for fair presentation of such interim
periods). All such financial statements, including the related schedules and
notes thereto, if any, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the
aforementioned firm of accountants and disclosed therein). The Borrower and its
Subsidiaries do not have any material Guarantee Obligations, contingent
liabilities and liabilities for taxes, or any long-term leases or unusual
forward or long-term commitments, including, without limitation, any interest
rate or foreign currency swap or exchange transaction or other obligation in
respect of derivatives, which are not reflected in the most recent financial
statements referred to in this paragraph (b). During the period from March 31,
1997 to and including the date hereof there has been no Disposition by the
Borrower or its Subsidiaries of any material part of its business or Property or
any transfer of Capital Stock to any Person other than a Wholly Owned Subsidiary
Guarantor.
(c) The audited consolidated balance sheets of the Target as at
October 2, 1994, October 1, 1995 and September 29, 1996, and the related
consolidated statements of income and of cash flows for the fiscal years ended
on such dates, reported on by and accompanied by an unqualified report from
Price Waterhouse LLP, present fairly the consolidated financial condition of the
Target as at such dates, and the consolidated results of its operations and its
consolidated cash flows for the respective fiscal years then ended. The
unaudited consolidated balance sheet of the Target as at June 30, 1997, and the
related unaudited consolidated statements of income and cash flows for the nine-
month period ended on such date, present fairly the consolidated financial
condition of the Target as at such date, and the consolidated results of its
operations and its consolidated cash flows for the nine-month period then ended
(subject to normal year-end audit adjustments). All such financial statements,
including the related schedules and notes thereto, if any, have been prepared in
accordance with GAAP applied consistently throughout the periods involved
(except as approved by the aforementioned firm of accountants and disclosed
therein). The Target and its Subsidiaries do not have any material Guarantee
Obligations, contingent liabilities and liabilities for taxes, or any long-term
leases or unusual forward or long-term commitments, including, without
limitation, any interest rate or foreign currency swap or exchange transaction
or other obligation in respect of derivatives, which are not reflected in the
most recent financial statements referred to in this paragraph (c). During the
period from September 30, 1996 to and including the date hereof there has been
no Disposition by the Target or its Subsidiaries of any material part of its
business or Property.
4.2 No Change. Since March 31, 1997 there has been no development or
event which has had or could reasonably be expected to have a Material Adverse
Effect.
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4.3 Corporate Existence; Compliance with Law. Each of the Borrower
and its Subsidiaries (a) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (b) has the
corporate power and authority, and the legal right, to own and operate its
Property, to lease the Property it operates as lessee and to conduct the
business in which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of Property or the conduct of its business
requires such qualification and (d) is in compliance with all Requirements of
Law except, in the case of clauses (c) and (d), to the extent that the failure
to so qualify, be in good standing or comply therewith could not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.
4.4 Corporate Power; Authorization; Enforceable Obligations. Each
Loan Party has the corporate power and authority, and the legal right, to make,
deliver and perform the Loan Documents to which it is a party and, in the case
of the Borrower, to borrow hereunder. Each Loan Party has taken all necessary
corporate action to authorize the execution, delivery and performance of the
Loan Documents to which it is a party and, in the case of the Borrower, to
authorize the borrowings on the terms and conditions of this Agreement. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with the Tender Offer, the Debt Tender Offer, the financing
transactions contemplated hereby and the borrowings hereunder or with the
execution, delivery, performance, validity or enforceability of this Agreement
or any of the Loan Documents, except (i) consents, authorizations, filings and
notices which have been obtained or made and are in full force and effect, (ii)
the filings referred to in Section 4.18(b) and (iii) with respect to the Tender
Offer and the Debt Tender Offer, those which if not obtained could not, in the
aggregate, reasonably be expected to materially affect the consummation thereof.
Each Loan Document has been duly executed and delivered on behalf of each Loan
Party party thereto. This Agreement constitutes, and each other Loan Document
upon execution will constitute, a legal, valid and binding obligation of each
Loan Party party thereto, enforceable against each such Loan Party in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or
similar laws affecting the enforcement of creditors' rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law).
4.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the other Loan Documents, the issuance of Letters of Credit, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or any Contractual Obligation of the Borrower or any of its
Subsidiaries and will not result in, or require, the creation or imposition of
any Lien on any of their respective material properties or revenues pursuant to
any Requirement of Law or any such Contractual Obligation (other than the Liens
created by the Security Documents). No Requirement of Law or Contractual
Obligation applicable to the Borrower or any of its Subsidiaries could
reasonably be expected to have a Material Adverse Effect.
4.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of the Borrower,
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threatened by or against the Borrower or any of its Subsidiaries or against any
of their respective properties or revenues (a) with respect to any of the Loan
Documents or any of the transactions contemplated hereby or thereby, or (b)
which if adversely determined could reasonably be expected to have a Material
Adverse Effect.
4.7 No Default. Neither the Borrower nor any of its Subsidiaries is
in default under or with respect to any of its Contractual Obligations in any
respect which could reasonably be expected to have a Material Adverse Effect.
No Default or Event of Default has occurred and is continuing.
4.8 Ownership of Property; Liens. Each of the Borrower and its
Subsidiaries has indefeasible title to, or a valid leasehold interest in, all
its material real property necessary for the conduct of its business as
currently conducted, and good title to, or a valid leasehold interest in, all
its other material Property necessary for the conduct of its business as
currently conducted, and none of such Property is subject to any Lien except as
permitted by Section 7.3.
4.9 Intellectual Property. The Borrower and each of its Subsidiaries
owns, or is licensed to use, all Intellectual Property necessary to conduct its
business as currently conducted. No material claim has been asserted and is
pending by any Person challenging or questioning the use of any Intellectual
Property or the validity or effectiveness of any Intellectual Property. The use
of Intellectual Property by the Borrower and its Subsidiaries does not infringe
on the rights of any Person in any material respect.
4.10 Taxes. Each of the Borrower and each of its Subsidiaries has
filed or caused to be filed all Federal, state and other material tax returns
which are required to be filed and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any of its
Property and all other taxes, fees or other charges imposed on it or any of its
Property by any Governmental Authority (other than amounts the validity of which
are currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be); no material tax
Lien has been filed, and, to the knowledge of the Borrower, no material claim is
being asserted, with respect to any such tax, fee or other charge.
4.11 Federal Regulations. Assuming compliance by the Lenders with
Section 2.19 and the accuracy of the representations in Section 2.19(b), no part
of the proceeds of any Loans will be used for any purpose which violates the
provisions of Regulations G, T, U or X of the Board.
4.12 ERISA. Except for the Merger of Spreckels Sugar Company, Inc.
into ▇▇▇▇▇ Sugar Company on March 31, 1997, neither a Reportable Event nor an
"accumulated funding deficiency" (within the meaning of Section 412 of the Code
or Section 302 of ERISA) has occurred during the five-year period prior to the
date on which this representation is made or deemed made with respect to any
Plan, and each Plan has complied in all material respects with the applicable
provisions of ERISA and the Code. No termination of a Single Employer Plan has
occurred, and no Lien in favor of the PBGC or a Plan has arisen, during such
five-year period.
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The present value of all accrued benefits under each Single Employer Plan (based
on those assumptions used to fund such Plans) did not, as of the last annual
valuation date prior to the date on which this representation is made or deemed
made, exceed the value of the assets of such Plan allocable to such accrued
benefits by an amount material in light of such amounts and related
circumstances. Neither the Borrower nor any Commonly Controlled Entity has had a
complete or partial withdrawal from any Multiemployer Plan which has resulted or
could reasonably be expected to result in a material liability under ERISA, and
neither the Borrower nor any Commonly Controlled Entity would become subject to
any material liability under ERISA if the Borrower or any such Commonly
Controlled Entity were to withdraw completely from all Multiemployer Plans as of
the valuation date most closely preceding the date on which this representation
is made or deemed made. No such Multiemployer Plan is in Reorganization or
Insolvent.
4.13 Investment Company Act; Other Regulations. No Loan Party is an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) which limits its ability to incur Indebtedness.
4.14 Subsidiaries. The Subsidiaries listed on Schedule 4.14
constitute all the Subsidiaries of the Borrower at the date hereof.
4.15 Use of Proceeds. The proceeds of the Term Loans shall be used to
finance the acquisition by the Borrower of the Specified Number of Shares
pursuant to the Tender Offer. The proceeds of the Revolving Credit Loans and the
Letters of Credit shall be used for (a) the repayment of the principal of, and
accrued interest on and premium, if any, in respect of, the Existing Borrower
Debt, (b) the payment of interest, fees and other expenses incurred in
connection with the Tender Offer and the Merger and (iii) working capital
purposes and other general corporate purposes of the Borrower and its
Subsidiaries.
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4.16 Environmental Matters. Other than exceptions to any of the
following that could not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect or the payment of a Material
Environmental Amount:
(a) The Borrower and its Subsidiaries: (i) are, and within the
period of all applicable statutes of limitation have been, in compliance with
all applicable Environmental Laws; (ii) hold all Environmental Permits (each of
which is in full force and effect) required for any of their current operations
or for any property owned, leased, or otherwise operated by any of them; (iii)
are, and within the period of all applicable statutes of limitation have been,
in compliance with all of their Environmental Permits; and (iv) reasonably
believe that there are no pending changes in applicable Environmental Laws.
(b) Materials of Environmental Concern are not present at, on, under,
in, or about any real property now or formerly owned, leased or operated by the
Borrower or any of its Subsidiaries or, to the Borrower's knowledge, at any
other location (including, without limitation, any location to which Materials
of Environmental Concern have been sent for re-use or recycling or for
treatment, storage, or disposal) which could reasonably be expected to (i) give
rise to liability of the Borrower or any Subsidiary, or (ii) interfere with the
Borrower's or any Subsidiary's continued operations, or (iii) impair the fair
saleable value, as a component of a going business, of any real property owned
or leased by the Borrower or any Subsidiary.
(c) There is no judicial, administrative, or arbitral proceeding
(including any notice of violation or alleged violation) under or relating to
any Environmental Law to which the Borrower or any of its Subsidiaries is, or to
the knowledge of the Borrower will be, named as a party that is pending or, to
the knowledge of the Borrower, threatened.
(d) Neither the Borrower nor any of its Subsidiaries has received any
written request for information, or been notified that it is a potentially
responsible party under or relating to the federal Comprehensive Environmental
Response, Compensation, and Liability Act or any similar Environmental Law, or
with respect to any Materials of Environmental Concern.
(e) Neither the Borrower nor any of its Subsidiaries has entered into
or agreed to any consent decree, order, or settlement or other agreement, nor is
subject to any judgment, decree, or order or other agreement, in any judicial,
administrative, arbitral, or other forum, relating to compliance with or
liability under any Environmental Law.
(f) Neither the Borrower nor any of its Subsidiaries has assumed or
retained, by contract or operation of law, any liabilities of any kind, fixed or
contingent, known or unknown, under any Environmental Law or with respect to any
Material of Environmental Concern.
Notwithstanding the qualification as to the Borrower's knowledge set forth in
the foregoing subsection 4.16(b), for purposes of Section 8(b) the
representations contained in such subsection 4.16(b) shall be deemed to be made,
or have been made, as the case may be, without giving effect to such
qualification.
42
4.17 Accuracy of Information, etc. No statement or information when
taken as a whole contained in this Agreement, any other Loan Document or any
other document, certificate or statement furnished to the Administrative Agent
or the Lenders or any of them, by or on behalf of any Loan Party for use in
connection with the transactions contemplated by this Agreement or the other
Loan Documents, contained as of the date such statement, information, document
or certificate was so furnished, any untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
contained herein or therein not misleading. The projections and pro forma
financial information contained in the materials referenced above are based upon
good faith estimates and assumptions believed by management of the Borrower to
be reasonable at the time made, it being recognized by the Lenders that such
financial information as it relates to future events is not to be viewed as fact
and that actual results during the period or periods covered by such financial
information may differ from the projected results set forth therein by a
material amount. As of the date hereof, the representations and warranties
contained in the Transaction Documentation are true and correct in all material
respects. There is no fact known to any Loan Party that could reasonably be
expected to have a Material Adverse Effect that has not been expressly disclosed
herein, in the other Loan Documents or in any other documents, certificates and
statements furnished to the Administrative Agent and the Lenders for use in
connection with the transactions contemplated hereby and by the other Loan
Documents.
4.18 Security Documents. (a) The Guarantee and Collateral Agreement
is effective to create in favor of the Administrative Agent, for the benefit of
the Lenders, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof. In the case of the Pledged Stock that is
certificated described in the Guarantee and Collateral Agreement, when stock
certificates representing such Pledged Stock are delivered to the Administrative
Agent, in the case of Book Entry Securities (as defined in the Target Pledge
Agreement), upon the taking of the actions described in Section 5.2(f) and in
the case of the other Collateral (including uncertificated Pledged Stock)
described in the Guarantee and Collateral Agreement, when financing statements
in appropriate form are filed in the offices specified on Schedule 4.18(a), the
Guarantee and Collateral Agreement shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the Loan Parties in
such Collateral and, subject to compliance with applicable law, the proceeds
thereof, as security for the Obligations (as defined in the Guarantee and
Collateral Agreement), in each case prior and superior in right to any other
Person (other than Liens expressly permitted by Section 7.3).
(b) Each of the Mortgages is effective to create in favor of the
Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable Lien on the Mortgaged Properties described therein and proceeds
thereof, and when the Mortgages are filed in the offices specified on Schedule
4.18(b), each such Mortgage shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the Loan Parties in the
Mortgaged Properties and the proceeds thereof, as security for the Obligations
(as defined in the relevant Mortgage), in each case prior and superior in right
to any other Person except for (i) Liens expressly permitted by Section 7.3
hereof and (ii) all matters set forth in Schedule B to the mortgagees title
insurance policy delivered to the Administrative Agent in accordance with
Section 5.1(r)(iii) herein.
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(c) The Target Pledge Agreement is effective to create in favor of
the Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable security interest in the Collateral described therein and proceeds
thereof. In the case of the Collateral described in the Target Pledge
Agreement, upon compliance with the provisions of Sections 3(a) and (b) thereof,
the Target Pledge Agreement shall constitute a fully perfected Lien on, and
security interest in, all right, title and interest of the IHK Merger Sub in
such Collateral and the proceeds thereof, subject in the case of proceeds to
compliance with applicable law, as security for the Obligations (as defined in
the Target Pledge Agreement), in each case prior and superior in right to any
other Person.
4.19 Solvency. Each Loan Party is, and after giving effect to the
Tender Offer and the other transactions contemplated hereby and the incurrence
of all Indebtedness and obligations being incurred in connection herewith and
therewith will be and will continue to be, Solvent.
4.20 Regulation H. No Mortgage encumbers improved real property which
is located in an area that has been identified by the Secretary of Housing and
Urban Development as an area having special flood hazards and in which flood
insurance has been made available under the National Flood Insurance Act of 1968
except as set forth on Schedule 4.20.
SECTION 5. CONDITIONS PRECEDENT
5.1 Conditions to Initial Revolving Extension of Credit. The
agreement of each Lender to make the initial extension of credit requested to be
made by it under the Revolving Credit Commitments is subject to the
satisfaction, prior to or concurrently with the making of such extension of
credit on the Closing Date, of the following conditions precedent:
(a) Loan Documents. The Administrative Agent shall have received (i)
this Agreement, executed and delivered by a duly authorized officer of the
Borrower, (ii) the Guarantee and Collateral Agreement, executed and
delivered by a duly authorized officer of the Borrower and each Subsidiary
Guarantor, (iii) each of the Mortgages, executed and delivered by a duly
authorized officer of each party thereto, (iv) for the account of each
relevant Lender, Notes conforming to the requirements hereof and executed
and delivered by a duly authorized officer of the Borrower and (v) the
Control Agreement, executed and delivered by a duly authorized officer of
each party thereto .
(b) Related Agreements. The Administrative Agent shall have received
(in a form reasonably satisfactory to the Syndication Agent), true and
correct copies, certified as to authenticity by the Borrower, of the Merger
Agreement, the Offer to Purchase, the Debt Tender Offer, the Senior Note
Indenture (including the supplemental indenture reflecting the
effectiveness of amendments pursuant to the Debt Tender Offer as described
in clause (e) below), the Stockholders Agreement and such other documents
or instruments as may be reasonably requested by the Syndication Agent.
44
(c) Acquisition Matters. (i) Each of the Offer to Purchase, the
Merger Agreement shall have remained in full force and effect and shall not
have been amended, supplemented, waived or otherwise modified in any
material respect (other than to the extent the Offer to Purchase is
supplemented to extend the final date for the Tender Offer Purchase to a
date not later than November 30, 1997), and the conditions to the Tender
Offer Purchase set forth in the Offer to Purchase shall not have been
waived, in each case without the prior written consent of the Syndication
Agent; (ii) the Tender Offer shall have been made in accordance with
applicable law and the Offer to Purchase and shall not have been terminated
or expired without extension in accordance therewith; (iii) the Specified
Number of Shares shall have been tendered and not withdrawn pursuant to the
Tender Offer; and (iv) the capital structure, corporate structure,
ownership and management of each Loan Party as contemplated after giving
effect to the Tender Offer and as contemplated by the Merger Agreement
shall be substantially as described to the Syndication Agent in writing
prior to the Commitment Letter Date, and the sources and uses of funds for
the Tender Offer and the Merger shall be as set forth on Schedule 4.1(b).
(d) Public Filings. The documents and materials filed publicly by
the Borrower, IHK Merger Sub and Target in connection with the Acquisition
shall have been furnished to the Administrative Agent and the Syndication
Agent and shall be reasonably satisfactory in form and substance to the
Syndication Agent.
(e) Existing Debt. On the Closing Date after giving effect to the
repayments made on the Closing Date concurrently with the other conditions
precedent to be satisfied on the Closing Date, (i) the Existing Credit
Facility shall have been paid in full and terminated, and the Syndication
Agent shall have received such evidence thereof, along with documents and
instruments terminating and releasing any liens thereunder, as shall be
reasonably satisfactory to it, (ii) the Debt Tender Offer shall not have
been amended, supplemented, waived or otherwise modified in any material
respect without the prior written consent of the Syndication Agent, and the
"Proposed Amendments to Indenture" set forth (and as defined) therein shall
have become effective in accordance with applicable law and the terms of
the Debt Tender Offer, and (iii) the "Consent Payments" and "Tender Offer
Consideration" under (and as defined in) the Debt Tender Offer shall be
made with respect to Senior Notes tendered thereunder in accordance
therewith.
(f) Fees. The Lenders, Syndication Agent and the Administrative
Agent shall have received all fees required to be paid, and all expenses
for which invoices have been presented, on or before the Closing Date.
(g) Approvals. All governmental, shareholder and third party
approvals (including debtholders', landlords' and other consents)
reasonably necessary in connection with the making of the Tender Offer, the
effectiveness of the Merger Agreement and the financing contemplated hereby
shall have been obtained, and all applicable waiting periods shall have
expired or been extended without any action being taken or threatened by
any Governmental Authority which would restrain, prevent or otherwise
impose adverse conditions on Tender Offer, the Merger or the financing
thereof.
45
(h) Financial Information. The Lenders shall have received (i)
satisfactory Pro Forma Balance Sheets described in subsection 4.1(a), (ii)
audited financial statements of Target for its fiscal years ended October
2, 1994, October 1, 1995 and September 29, 1996, (iii) audited financial
statements of the Borrower for its fiscal years ended March 31 of 1995,
1996 and 1997 and (iv) unaudited interim financial statements of each of
the Borrower and the Target for each quarterly period ended subsequent to
September 29, 1996, in the case of Target, and March 31, 1997, in the case
of the Borrower, as to which such financial statements are available, and
such financial statements shall not, in the reasonable judgment of the
Lenders, reflect any material adverse change in the consolidated financial
condition of the Borrower and its Subsidiaries (including for this purpose
Target as a Subsidiary), as reflected in the financial statements or
projections provided to the Syndication Agent prior to the Commitment
Letter Date.
(i) Solvency Opinion. The Lenders shall have received a satisfactory
solvency opinion from an independent valuation firm satisfactory to the
Syndication Agent which shall document the solvency of the Borrower and its
subsidiaries taken as a whole after giving effect to the Closing Date and
after giving effect to the Tender Offer Purchase and the financings and
related transactions contemplated hereby.
(j) Environmental Information. The Lenders shall have received
environmental information with respect to the Borrower and its subsidiaries
and Target and its subsidiaries satisfactory to the Syndication Agent.
(k) Proceedings. There shall exist no judgment, order, injunction or
other restraint which would prevent or delay the consummation of, or impose
materially adverse conditions upon, the Tender Offer or the Merger, and
there shall exist no claim, action, suit, investigation, litigation or
proceeding (including, without limitation, shareholder or derivative
litigation) pending or threatened in any court or before any arbitrator or
governmental instrumentality which relates to the Tender Offer or the
Merger which has any reasonable likelihood of having a material adverse
effect on (i) the financial condition, operations, business or properties
of either the Borrower or the Target and their respective subsidiaries
taken as a whole, (ii) the Tender Offer, the Merger, or the financing
thereof or (iii) the rights and remedies of the Administrative Agent, the
Syndication Agent or the Lenders under the Credit Documentation or on the
ability of the Borrower and its subsidiaries to perform their respective
obligations thereunder.
(l) Marketable Securities. The Syndication Agent shall be reasonably
satisfied that the Borrower's portfolio of marketable securities shall have
remained substantially equivalent (other than changes resulting from
changes in market value thereof) to that previously described in writing to
the Syndication Agent prior to the Commitment Letter Date.
(m) Regulations of Board. The Lenders shall be satisfied that the
Tender Offer and the financing thereof comply with Regulation G, T, U and X
of the Board.
46
(n) Closing Certificate. The Administrative Agent shall have
received, with a counterpart for each Lender, a certificate of each Loan
Party, dated the Closing Date, substantially in the form of Exhibit C, with
appropriate insertions and attachments.
(o) Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions:
(i) the legal opinion of ▇▇▇▇▇▇▇ & ▇▇▇▇▇ L.L.P., counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit F-1;
(ii) the legal opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, general counsel of the
Borrower and its Subsidiaries, substantially in the form of Exhibit F-2;
(iii) to the extent consented to by the relevant counsel, each
legal opinion, if any, delivered in connection with the Merger Agreement,
accompanied by a reliance letter in favor of the Lenders; and
(iv) the legal opinion of local counsel in each of California,
Montana and Wyoming and of such other special and local counsel as may be
required by the Administrative Agent.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.
(p) Pledged Stock; Stock Powers. The Administrative Agent shall have
received the certificates representing the shares of Capital Stock pledged
pursuant to the Guarantee and Collateral Agreement, together with an
undated stock power for each such certificate executed in blank by a duly
authorized officer of the pledgor thereof.
(q) Filings, Registrations and Recordings. Each document (including,
without limitation, any Uniform Commercial Code financing statement)
required by the Security Documents or under law or reasonably requested by
the Administrative Agent to be filed, registered or recorded in order to
create in favor of the Administrative Agent, for the benefit of the
Lenders, a perfected Lien on the Collateral described therein, prior and
superior in right to any other Person (other than with respect to Liens
expressly permitted by Section 7.3), shall be in proper form for filing,
registration or recordation. The Syndication Agent shall have received the
results of a recent lien, tax and judgment search in each of the
jurisdictions and offices where assets of each of the Borrower, IHK Merger
Sub, Target and their subsidiaries are located or recorded, and such search
shall reveal no material liens on any of their assets except for liens
permitted by this Agreement or liens to be discharged substantially
concurrently with the Closing Date.
(r) Mortgages, etc. (i) The Syndication Agent shall have received a
Mortgage with respect to each Mortgaged Property, executed and delivered by
a duly authorized officer of each party thereto.
46
(ii) If requested by the Syndication Agent, the Administrative
Agent shall have received, and the title insurance company issuing the
policy referred to in Section 5.1(r)(iii) (the "Title Insurance Company")
shall have received, maps or plats of an as-built survey of the sites of
the Mortgaged Properties certified to the Administrative Agent and the
Title Insurance Company in a manner satisfactory to them, dated a date
satisfactory to the Syndication Agent and the Title Insurance Company by an
independent professional licensed land surveyor satisfactory to the
Syndication Agent and the Title Insurance Company, which maps or plats and
the surveys on which they are based shall be made in accordance with the
Minimum Standard Detail Requirements for Land Title Surveys jointly
established and adopted by the American Land Title Association and the
American Congress on Surveying and Mapping in 1992, and, without limiting
the generality of the foregoing, there shall be surveyed and shown on such
maps, plats or surveys the following: (A) the locations on such sites of
all the buildings, structures and other improvements and the established
building setback lines; (B) the lines of streets abutting the sites and
width thereof; (C) all access and other easements appurtenant to the sites;
(D) all roadways, paths, driveways, easements, encroachments and
overlapping improvements and similar encumbrances affecting the site,
whether recorded, apparent from a physical inspection of the sites or
otherwise known to the surveyor; (E) any encroachments on any adjoining
property by the building structures and improvements on the sites; (F) if
the site is described as being on a filed map, a legend relating the survey
to said map; and (G) the flood zone designations, if any, in which the
Mortgaged Properties are located.
(iii) The Administrative Agent shall have received in respect
of each Mortgaged Property a mortgagee's title insurance policy (or
policies) or marked up unconditional binder for such insurance or, in the
case of Mortgaged Property located in the State of Texas, an effective
commitment in respect thereof. Each such policy shall (A) be in an amount
satisfactory to the Syndication Agent; (B) be issued at ordinary rates; (C)
insure that the Mortgage insured thereby creates a valid first Lien on such
Mortgaged Property free and clear of all defects and encumbrances, except
(i) as disclosed therein and (ii) those Liens expressly permitted by
Section 7.3 hereof; (D) name the Administrative Agent for the benefit of
the Lenders as the insured thereunder; (E) be in the form of ALTA Loan
Policy (or equivalent policies); (F) contain such endorsements and
affirmative coverage as the Syndication Agent may reasonably request and
(G) be issued by title companies satisfactory to the Syndication Agent
(including any such title companies acting as co-insurers or reinsurers, at
the option of the Syndication Agent). The Syndication Agent shall have
received evidence satisfactory to it that all premiums in respect of each
such policy, all charges for mortgage recording tax, and all related
expenses, if any, have been paid.
(iv) If requested by the Syndication Agent, the Administrative
Agent shall have received (A) a policy of flood insurance which (1) covers
any parcel of improved real property which is encumbered by any Mortgage
(2) is written in an amount not less than the outstanding principal amount
of the indebtedness secured by such Mortgage which is reasonably allocable
to such real property or the maximum limit of coverage made
48
available with respect to the particular type of property under the
National Flood Insurance Act of 1968, whichever is less, and (3) has a term
ending not later than the maturity of the Indebtedness secured by such
Mortgage and (B) confirmation that the Borrower has received the notice
required pursuant to Section 208(e)(3) of Regulation H of the Board.
(v) The Administrative Agent shall have received a copy of all
recorded documents referred to, or listed as exceptions to title in, the
title policy or policies referred to in Section 5.1(r)(iii) and a copy of
all other material documents affecting the Mortgaged Properties.
(s) Insurance. The Administrative Agent shall have received
insurance certificates satisfying the requirements of Section 5.3 of the
Guarantee and Collateral Agreement.
5.2 Conditions to Term Loans. The agreement of each Lender to make
the Term Loan requested to be made by it under the Term Loan Commitments is
subject to the satisfaction, prior to or concurrently with the making of such
Term Loan on the Tender Funding Date, of the following conditions precedent:
(a) Initial Conditions. The conditions precedent set forth in
Section 5.1 hereto shall have been satisfied (or waived in a manner
satisfactory to the Syndication Agent) and shall remain satisfied as of the
Tender Funding Date.
(b) Tender Offer. (i) The Tender Offer Purchase shall have been, or
concurrently with the making of the Term Loans on the Tender Funding Date
shall be, consummated pursuant to the Offer to Purchase and in accordance
with the Merger Agreement, (ii) IHK Merger Sub shall have acquired,
concurrently with the making of the Loans on the Tender Funding Date, the
Specified Number of Shares, and there shall not have been any material
change from 14,397,836 as the number of Shares representing the Specified
Number of Shares on the date the Tender Offer is consummated, and (iii) the
Administrative Agent shall have received certified copies of such documents
as shall be requested by the Syndication Agent to evidence that the actions
described above in this paragraph have been taken.
(c) Approvals. All governmental (including compliance with the H-S-R
Act in respect of the Tender Offer and the Merger) and third party
approvals (including debtholders', landlords' and other consents) necessary
or advisable in connection with the Tender Offer, the Tender Offer
Purchase, the Merger, the continuing operations of the Borrower, Target and
each of their Subsidiaries after the Tender Offer Purchase and the Merger
and the financing provided pursuant to this Agreement shall have been
obtained and be in full force and effect, and all applicable waiting
periods shall have expired without any action being taken or threatened by
any competent authority which would restrain, prevent or otherwise impose
adverse conditions on the Tender Offer, the Tender Offer Purchase, the
Merger or the other transactions and financings contemplated hereby.
49
(d) Regulations of Board; Forms G-3 and U-1. The Lenders shall be
satisfied that the Tender Offer and the financing thereof comply with
Regulation G, T, U and X of the Board. Each Lender shall have received a
duly completed and executed Form G-3 or Form FR U-1, as applicable, of the
Board, demonstrating such compliance.
(e) Loan Documents. The Administrative Agent shall have received (i)
the Target Pledge Agreement, executed and delivered by a duly authorized
officer of the IHK Merger Sub, and (ii) the Depositary Agency Agreement,
executed and delivered by a duly authorized officer of each party thereto.
(f) Pledged Stock; Stock Powers. The Administrative Agent or the
Depositary shall have received the certificates representing the Shares
pledged pursuant to the Target Pledge Agreement (other than such Shares
constituting Book-Entry Shares (as defined in the Target Pledge
Agreement)), together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the Borrower, and with
respect to Shares consisting of Book-Entry Shares, evidence that all
actions described in Section 3(b) of the Target Pledge Agreement which are
necessary to create and perfect the security interests pursuant to the
Target Pledge Agreement in accordance with Article 8 of the Uniform
Commercial Code have been taken. The Shares pledged on the Closing Date
pursuant to the Target Pledge Agreement shall constitute all Shares owned
by the Borrower or any of its affiliates, whether acquired in the Tender
Offer or otherwise.
(g) Fees. The Lenders, the Syndication Agent and the Administrative
Agent shall have received all fees required to be paid on or before the
Tender Funding Date.
5.3 Conditions to Each Extension of Credit. The agreement of each
Lender to make any extension of credit requested to be made by it on any date
(including, without limitation, its initial extension of credit) is subject to
the satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the Loan Documents
shall be true and correct on and as of such date as if made on and as of
such date.
(b) No Default. No Default or Event of Default shall have occurred
and be continuing on such date or after giving effect to the extensions of
credit requested to be made on such date.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 5.3 have been satisfied.
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SECTION 6. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in
effect, any Letter of Credit remains outstanding or any Loan or other amount is
owing to any Lender or any Agent hereunder, the Borrower shall and shall cause
each of its Subsidiaries to:
6.1 Financial Statements. Furnish to each Agent and each Lender:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Borrower, a copy of the audited consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at the
end of such year and the related audited consolidated statements of income
and of cash flows for such year, setting forth in each case in comparative
form the figures for the previous year, reported on without a "going
concern" or like qualification or exception, or qualification arising out
of the scope of the audit, by Deloitte & Touche LLP or other independent
certified public accountants of nationally recognized standing; and
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of the Borrower, the unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such quarter
and the related unaudited consolidated statements of income for such
quarter and the portion of the fiscal year through the end of such quarter
and an unaudited consolidated statement of cash flow for the portion of the
fiscal year through the end of such quarter, setting forth in each case in
comparative form the figures for the previous year, certified by a
Responsible Officer as being fairly stated in all material respects
(including all adjustments consisting only of normal recurring accruals
necessary for fair presentation of such interim periods);
all such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
6.2 Certificates; Other Information. Furnish to each Agent and each
Lender, or, in the case of clause (f), to the relevant Lender:
(a) concurrently with the delivery of the financial statements
referred to in Section 6.1(a), a certificate of the independent certified
public accountants reporting on such financial statements stating that in
making the examination necessary therefor no knowledge was obtained of any
Default or Event of Default, except as specified in such certificate;
(b) concurrently with the delivery of any financial statements
pursuant to Sections 6.1(a) and (b), (i) a certificate of a Responsible
Officer stating that, to the best of each such Responsible Officer's
knowledge, each Loan Party during such period has observed
51
or performed all of its covenants and other agreements, and satisfied every
condition, contained in this Agreement and the other Loan Documents to
which it is a party to be observed, performed or satisfied by it, and that
such Responsible Officer has obtained no knowledge of any Default or Event
of Default except as specified in such certificate and (ii) (x) a
Compliance Certificate containing all information necessary for determining
compliance by the Borrower and its Subsidiaries with the provisions of this
Agreement referred to therein as of the last day of the fiscal quarter or
fiscal year of the Borrower, as the case may be, and (y) to the extent not
previously disclosed to the Administrative Agent, a listing of any county
or state within the United States where any Loan Party keeps inventory or
equipment and of any Intellectual Property acquired by any Loan Party since
the date of the most recent list delivered pursuant to this clause (y) (or,
in the case of the first such list so delivered, since the Closing Date);
(c) as soon as available, and in any event no later than 60 days
after the end of each fiscal year of the Borrower, a detailed consolidated
budget for the following fiscal year (including a projected consolidated
balance sheet of the Borrower and its Subsidiaries as of the end of the
following fiscal year, and the related consolidated statements of projected
cash flow, projected changes in financial position and projected income),
and, as soon as available, significant revisions, if any, of such budget
and projections with respect to such fiscal year (collectively, the
"Projections"), which Projections shall in each case be accompanied by a
certificate of a Responsible Officer stating that such Projections are
based on reasonable estimates, information and assumptions and that such
Responsible Officer has no reason to believe that such Projections are
incorrect or misleading in any material respect;
(d) within 45 days after the end of each fiscal quarter of the
Borrower, a narrative discussion and analysis of the financial condition
and results of operations of the Borrower and its Subsidiaries for such
fiscal quarter and for the period from the beginning of the then current
fiscal year to the end of such fiscal quarter, as compared to the portion
of the Projections covering such periods and to the comparable periods of
the previous year;
(e) promptly after the same are sent, copies of all financial
statements and reports which the Borrower sends to the holders of any class
of its debt securities or public equity securities and within five days
after the same are filed, copies of all financial statements and reports
which the Borrower may make to, or file with, the Securities and Exchange
Commission or any successor or analogous Governmental Authority; and
(f) promptly, such additional financial and other information as any
Agent or any Lender may from time to time reasonably request through the
Administrative Agent.
6.3 Payment of Obligations. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being contested in good faith by appropriate proceedings
and reserves in conformity with GAAP with respect thereto have been provided on
the books of the Borrower or its Subsidiaries, as the case may be.
52
6.4 Conduct of Business and Maintenance of Existence, etc. 1 (a)
(i) Continue to engage in business of the same general type as now conducted by
it and business related thereto, all as set forth in subsection 7.14, (ii)
preserve, renew and keep in full force and effect its corporate existence except
that the Borrower shall not be required to preserve, renew or keep in full force
and effect the corporate or other existence of any Subsidiary, if the Board of
Directors of the Borrower shall determine in the exercise of its business
judgment that the preservation thereof is no longer desirable in the conduct of
the business of the Borrower or any Subsidiary and that abandonment of any such
right shall not have a Material Adverse Effect and (iii) take all reasonable
action to maintain all rights, privileges and franchises necessary or desirable
in the normal conduct of its business, except, in each case, as otherwise
permitted by Section 7.4 and except, in the case of clause (iii) above, to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect; (b) comply with its obligations under the Merger Agreement in
all material respects; and1 (c) comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect.
6.5 Maintenance of Property; Insurance. (a) Keep all Property
useful and necessary in its business in good working order and condition,
ordinary wear and tear excepted and (b) maintain with financially sound and
reputable insurance companies insurance or by means of self insurance with
adequate provisions made for the funding therefor on all its Property in at
least such amounts and against at least such risks (but including in any event
public liability, product liability and business interruption) as are usually
insured against in the same general area by companies engaged in the same or a
similar business.
6.6 Inspection of Property; Books and Records; Discussions. (a)
Keep proper books of records and account in which full, true and correct entries
in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its business and activities and (b)
permit representatives of the Administrative Agent and any Lender (coordinated,
to the extent reasonable, through the Administrative Agent) to visit and inspect
any of its properties and examine and make abstracts from any of its books and
records at any reasonable time during normal business hours and as often as may
reasonably be desired and to discuss the business, operations, properties and
financial and other condition of the Borrower and its Subsidiaries with officers
and employees of the Borrower and its Subsidiaries and with its independent
certified public accountants. If an Event of Default has occurred and is
continuing, Borrower will pay for all such examinations; prior thereto the
examining Lender will pay for same.
6.7 Notices. Promptly upon a Responsible Officer becoming aware
thereof, give notice to the Administrative Agent and each Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the
Borrower or any of its Subsidiaries and any
53
Governmental Authority, which in either case, if not cured or if adversely
determined, as the case may be, could reasonably be expected to have a
Material Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or any of its
Subsidiaries in which the amount involved is $10,000,000 or more and not
covered by insurance or in which injunctive or similar relief is sought
which if adversely determined could be reasonably expected to cause a
Material Adverse Effect;
(d) the following events, as soon as possible and in any event within
30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence of any Reportable Event with respect to any Plan, a failure to
make any required contribution to a Plan, the creation of any Lien in favor
of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the
institution of proceedings or the taking of any other action by the PBGC or
the Borrower or any Commonly Controlled Entity or any Multiemployer Plan
with respect to the withdrawal from, or the termination, Reorganization or
Insolvency of, any Plan; and
(e) any development or event which has had or could reasonably be
expected to have a Material Adverse Effect.
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Subsidiary proposes
to take with respect thereto.
6.8 Environmental Laws. (a)(i) Comply with all Environmental Laws
applicable to it, and obtain, comply with and maintain any and all Environmental
Permits necessary for its operations as conducted and as planned; and (ii) take
reasonable efforts to ensure that all of its tenants, subtenants, contractors,
subcontractors, and invitees comply with all Environmental Laws, and obtain,
comply with and maintain any and all Environmental Permits, applicable to any of
them insofar as any failure to so comply, obtain or maintain reasonably could be
expected to adversely affect the Borrower or any of its Subsidiaries. For
purposes of this 6.8(a), noncompliance by the Borrower or any of its
Subsidiaries with any applicable Environmental Law or Environmental Permit shall
be deemed not to constitute a breach of this covenant so long as (x) upon
learning of any actual or suspected noncompliance, the Borrower and any affected
Subsidiary shall promptly undertake reasonable efforts to achieve compliance,
and (y) in any case, such non-compliance, and any other noncompliance with
Environmental Law, individually or in the aggregate, could not reasonably be
expected to give rise to a Material Adverse Effect or materially and adversely
affect the value of the Mortgaged Property, taken as a whole.
(b) Promptly comply with all enforceable requirements of all
Governmental Authorities regarding Environmental Laws, other than such
enforceable requirements as to which appropriate proceedings have been timely
and properly taken in good faith so long as the pendency of any and all such
proceedings could not reasonably be expected to give rise to a Material Adverse
Effect.
54
(c) Prior to acquiring any ownership or leasehold interest in real
property, or other interest in any real property (x) involving aggregate value
for such property (including improvements thereof) of $2,000,000 or more and (y)
that could give rise to Borrower being found an owner, operator, or otherwise
subject to potential liability under any Environmental Law (or any entity with
such interests in any real property): (i) obtain a written report by an
environmental consulting firm reasonably acceptable to the Administrative Agent
(an "Environmental Consultant") of the Environmental Consultant's assessment of
the presence or potential presence of significant levels of any Materials of
Environmental Concern on, in, under, or about such property, or of other
conditions that could give rise to potentially significant liability under or
violations of Environmental Law relating to such acquisition, and notify the
Administrative Agent of such potential acquisition; and (ii) if requested by the
Administrative Agent after learning of such potential acquisition, provide such
Report to the Administrative Agent, provided that in the event that the Borrower
is contractually prohibited from providing any such requested Report prior to
the consummation of the applicable acquisition, such Report shall be delivered
promptly upon such consummation. The Administrative Agent shall have the right,
but shall not have any duty, to obtain any such report.
(d) Promptly upon the Administrative Agent's request if there has
occurred or the Administrative Agent reasonably anticipates an Event of Default,
permit an environmental consultant whom the Administrative Agent in its
discretion designates to perform an environmental assessment (including, without
limitation: reviewing documents; interviewing knowledgeable persons; and
sampling and analyzing soil, air, surface water, groundwater, and/or other media
in or about property owned or leased by the Borrower or any of its Subsidiaries,
or on which operations of the Borrower or any of its Subsidiaries otherwise take
place.) Such environmental assessment shall be in form, scope, and substance
satisfactory to the Administrative Agent. The Borrower and its Subsidiaries
shall cooperate fully in the conduct of such environmental assessment, and
Borrower shall pay the costs of such environmental assessment immediately upon
written demand by the Administrative Agent. The Administrative Agent shall have
the right, but shall not have any duty, to request and/or obtain such
environmental assessment.
6.9 Additional Collateral, etc. (a) With respect to any Property
acquired after the Closing Date by the Borrower or any of its Subsidiaries
(other than (x) any Property described in paragraph (b), (c) or (d) below and
(y) any Property subject to a Lien expressly permitted by Section 7.3(g)) as to
which the Administrative Agent, for the benefit of the Lenders, does not have a
perfected Lien, promptly (i) execute and deliver to the Administrative Agent
such amendments to the Guarantee and Collateral Agreement or such other
documents as the Administrative Agent deems necessary or advisable in order to
grant to the Administrative Agent, for the benefit of the Lenders, a security
interest in such Property and (ii) take all actions necessary or advisable to
grant to the Administrative Agent, for the benefit of the Lenders, a perfected
first priority security interest in such Property, including without limitation,
the filing of Uniform Commercial Code financing statements in such jurisdictions
as may be required by the Guarantee and Collateral Agreement or by law or as may
be requested by the Administrative Agent.
55
(b) With respect to any fee interest in any real estate having a
value (together with improvements thereof) of at least $2,000,000 acquired after
the Closing Date by the Borrower or any of its Subsidiaries (other than any such
real estate subject to a Lien expressly permitted by Section 7.3(g)), promptly
(i) execute and deliver a first priority mortgage or deed of trust, as the case
may be, in favor of the Administrative Agent, for the benefit of the Lenders,
covering such real estate, in form and substance reasonably satisfactory to the
Administrative Agent, (ii) if requested by the Administrative Agent, provide the
Lenders with (x) title and extended coverage insurance covering such real estate
in an amount at least equal to the purchase price of such real estate (or such
other amount as shall be reasonably specified by the Administrative Agent) as
well as a current ALTA survey thereof, together with a surveyor's certificate
and (y) any consents or estoppels reasonably deemed necessary or advisable by
the Administrative Agent in connection with such mortgage or deed of trust, each
of the foregoing in form and substance reasonably satisfactory to the
Administrative Agent and (iii) if requested by the Administrative Agent, deliver
to the Administrative Agent legal opinions relating to the matters described
above, which opinions shall be in form and substance substantially similar to
the relevant opinions delivered on the Closing Date and otherwise reasonably
satisfactory to the Syndication Agent, and from counsel reasonably satisfactory
to the Syndication Agent.
(c) With respect to any new Subsidiary (other than an Excluded
Foreign Subsidiary) created or acquired after the Closing Date (which, for the
purposes of this paragraph (c), shall include any existing Subsidiary that
ceases to be an Excluded Foreign Subsidiary), by the Borrower or any of its
Subsidiaries, promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative Agent
deems necessary or advisable in order to grant to the Administrative Agent, for
the benefit of the Lenders, a perfected first priority security interest in the
Capital Stock of such new Subsidiary which is owned by the Borrower or any of
its Subsidiaries, (ii) deliver to the Administrative Agent the certificates
representing such Capital Stock, together with undated stock powers, in blank,
executed and delivered by a duly authorized officer of the Borrower or such
Subsidiary, as the case may be, (iii) cause such new Subsidiary (A) to become a
party to the Guarantee and Collateral Agreement and (B) to take such actions
necessary or advisable to grant to the Administrative Agent for the benefit of
the Lenders a perfected first priority security interest in the Collateral
described in the Guarantee and Collateral Agreement with respect to such new
Subsidiary, including, without limitation, the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement or by law or as may be requested by the Administrative
Agent, and (iv) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance substantially similar to the
relevant opinions delivered on the Closing Date and otherwise reasonably
satisfactory to the Syndication Agent, and from counsel reasonably satisfactory
to the Syndication Agent.
(d) With respect to any new Excluded Foreign Subsidiary created or
acquired after the Closing Date by the Borrower or any of its Subsidiaries,
promptly (i) execute and deliver to the Administrative Agent such amendments to
the Guarantee and Collateral Agreement as the Administrative Agent deems
necessary or advisable in order to grant to the Administrative Agent, for the
benefit of the Lenders, a perfected first priority security interest in the
Capital Stock of
56
such new Subsidiary which is owned by the Borrower or any of its Subsidiaries
(provided that in no event shall more than 65% of the total outstanding Capital
Stock of any such new Subsidiary be required to be so pledged), (ii) deliver to
the Administrative Agent the certificates representing such Capital Stock,
together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of the Borrower or such Subsidiary, as the case may be and
(iii) if requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Syndication Agent.
6.10 Merger Consummation; Merger Agreement. Use its best efforts to
cause Target to comply in all material respects with all of its material
obligations under the Merger Agreement; cause the consummation of the Merger in
accordance with the Merger Agreement and all applicable Requirements of Law as
promptly as practicable, and, in any event, on or prior to the earlier of
January 31, 1998 and the date that is 90 days after the consummation of the
Tender Offer; and comply in all materials respects with its obligations under
the Transaction Documentation.
SECTION 7. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in
effect, any Letter of Credit remains outstanding or any Loan or other amount is
owing to any Lender or any Agent hereunder, the Borrower shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly:
7.1 Limitation on Activities of IHK Merger Sub. In the case of IHK
Merger Sub, notwithstanding anything to the contrary in this Agreement or any
other Loan Document, except to the extent necessary for the consummation of the
Tender Offer and the Merger in accordance with the Transaction Documentation:
(a) conduct, transact or otherwise engage in, or commit to conduct, transact or
otherwise engage in, any business or operations, (b) incur, create, assume or
suffer to exist any Indebtedness or other liabilities or financial obligations,
except (i) nonconsensual obligations imposed by operation of law, (ii) pursuant
to the Loan Documents to which it is a party and (iii) obligations with respect
to its Capital Stock, or (c) own, lease, manage or otherwise operate any
properties or assets (including cash and cash equivalents).
7.2 Limitation on Indebtedness. Create, incur, assume or suffer to
exist (in each case, to "Incur") any Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan Document;
(b) Indebtedness of the Borrower to any Subsidiary and of any Wholly
Owned Subsidiary Guarantor to the Borrower or any other Subsidiary;
57
(c) Indebtedness secured by Liens permitted by Section 7.3(g) in an
aggregate principal amount not to exceed, when added to the Capital Lease
Obligations permitted under paragraph (d) of this Section 7.2, $30,000,000
at any one time outstanding;
(d) Capital Lease Obligations in an aggregate principal amount not to
exceed, when added to the Indebtedness permitted under paragraph (c) of
this Section 7.2, $30,000,000 at any one time outstanding;
(e) Indebtedness outstanding on the date hereof and listed on
Schedule 7.2(e) and any refinancings, refundings, renewals or extensions
thereof (without any increase in the principal amount thereof);
(f) guarantees made in the ordinary course of business by the
Borrower or any of its Subsidiaries of obligations of any Wholly Owned
Subsidiary Guarantor;
(g) Indebtedness under any Interest Rate Protection Agreements
entered into to protect the Borrower or any of its Subsidiaries against
fluctuations in interest rates and not for speculative purposes;
(h) other Indebtedness (contingent or direct) not to exceed
$6,000,000 outstanding at any one time in respect of letters of credit
issued for the account of the Borrower or any of its Subsidiaries in the
conduct of their business in the ordinary course and any Guarantee
Obligations thereof;
(i) Indebtedness of the Borrower under the remaining Senior Notes
outstanding upon the consummation of the Debt Tender Offer in an aggregate
principal amount not to exceed $_________ at any time outstanding;
(j) renewals and extensions (in the same or lesser principal amount
on similar terms and conditions and in any case no less favorable to the
interests of the Lenders) of any Indebtedness listed in the foregoing
clauses;
(k) Indebtedness of ▇▇▇▇▇ Finance Company not to exceed $13,500,000
in aggregate principal amount outstanding at any time, provided that the
aggregate principal amount of such Indebtedness outstanding at any time,
when added to the aggregate principal amount of Indebtedness incurred
pursuant to subsection 7.2(l) below and outstanding at such time, does not
exceed $20,000,000; and
(l) other unsecured Indebtedness not to exceed $10,000,000 in
aggregate principal amount outstanding at any time, provided that the
aggregate principal amount of such Indebtedness outstanding at any time,
when added to the aggregate principal amount of Indebtedness incurred
pursuant to subsection 7.2(k) above and outstanding at such time, does not
exceed $20,000,000.
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7.3 Limitation on Liens. Create, incur, assume or suffer to exist
any Lien upon any of its Property or revenues, whether now owned or hereafter
acquired, except for:
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, provided that adequate reserves with
respect thereto are maintained on the books of the Borrower or its
Subsidiaries, as the case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's, repairmen's
or other like nonconsensual Liens imposed by operation of law, arising in
the ordinary course of business which are not overdue for a period of more
than 30 days or which are being contested in good faith by appropriate
proceedings;
(c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation;
(d) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions, minor irregularities in
title, and other similar encumbrances incurred in the ordinary course of
business which, in the aggregate, are not material in amount and which do
not in any case materially detract from the value of the Property subject
thereto or materially interfere with the ordinary conduct of the business
of the Borrower or any of its Subsidiaries and all such title matters
described in the Mortgages;
(f) Liens in existence on the date hereof listed on Schedule 7.3(f),
securing Indebtedness permitted by Section 7.2(e), provided that no such
Lien is spread to cover any additional Property after the Closing Date and
that the amount of Indebtedness secured thereby is not increased;
(g) Liens securing Indebtedness of the Borrower and any of its
Subsidiaries incurred pursuant to Section 7.2(c) or (d) to finance the
acquisition or lease of fixed or capital assets, provided that (i) such
Liens shall be created substantially simultaneously with the acquisition of
such fixed or capital assets, (ii) such Liens do not at any time encumber
any Property other than the Property financed by such Indebtedness and
(iii) the amount of Indebtedness secured thereby is not increased;
(h) Liens created pursuant to the Security Documents;
(i) any interest or title of a lessor under any lease entered into by
the Borrower or any Subsidiary of the Borrower in the ordinary course of
its business and covering only the assets so leased;
59
(j) Liens securing judgments which do not constitute an Event of
Default;
(k) Liens on Cash Equivalents to secure letter of credit
reimbursement obligations permitted under Section 7.2(h) in an aggregate
amount not to exceed $6,000,000;
(l) Liens securing Indebtedness of ▇▇▇▇▇ Finance Company permitted
under subsection 7.2(k) on notes payable to ▇▇▇▇▇ Finance Company in
respect of loans made by it in the ordinary course of its business to
growers;
(m) additional Liens securing obligations in an aggregate amount not
to exceed $3,000,000; and
(n) rights of lessees of equipment owned by the Borrower or any of
its Subsidiaries not interfering with the normal conduct of the Borrower's
business.
7.4 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or Dispose of, all or substantially all
of its Property or business, or make any material change in its present method
of conducting business, except:
(a) any Subsidiary of the Borrower may be merged or consolidated with
or into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any Wholly Owned Subsidiary
Guarantor (provided that the Wholly Owned Subsidiary Guarantor shall be the
continuing or surviving corporation);
(b) any Subsidiary of the Borrower may Dispose of any or all of its
assets (upon voluntary liquidation or otherwise) to the Borrower or any
Wholly Owned Subsidiary Guarantor; and
(c) the Tender Offer, Tender Offer Purchase, and the Merger may be
consummated so long as concurrently with the Merger all amounts outstanding
hereunder and under the Loan Documents shall be repaid in full.
7.5 Limitation on Sale of Assets. Dispose of any of its Property or
business (including, without limitation, receivables and leasehold interests),
whether now owned or hereafter acquired, or, in the case of any Subsidiary,
issue or sell any shares of such Subsidiary's Capital Stock to any Person,
except:
(a) the Disposition of surplus, obsolete or worn out property in the
ordinary course of business (including the expiration or termination of
leasehold interests related to receiving station leases);
(b) the sale of inventory in the ordinary course of business;
(c) Dispositions permitted by Section 7.4(b);
60
(d) Dispositions in the normal course of the Borrower's business of
non-operating assets unnecessary for the continued operation of the
Borrower's business;
(e) Disposition of the real property, improvements and equipment
associated with the non operating facilities at ▇▇▇▇▇▇▇▇ City, California
and Santa Barbara, California; and
(f) the sale or issuance of any Subsidiary's Capital Stock to the
Borrower or any Wholly Owned Subsidiary Guarantor.
7.6 Limitation on Dividends. Declare or pay any dividend (other than
dividends payable solely in common stock of the Person making such dividend) on,
or make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any shares of any class of Capital Stock of the Borrower or any
Subsidiary or any warrants or options to purchase any such Capital Stock,
whether now or hereafter outstanding, or make any other distribution in respect
thereof, either directly or indirectly, whether in cash or property or in
obligations of the Borrower or any Subsidiary (collectively, "Restricted
Payments"), except that (a) any Subsidiary may make Restricted Payments to the
Borrower or any Wholly Owned Subsidiary Guarantor and (b) the Borrower may
continue to pay dividends on its common stock in accordance with past practice
and in amounts per share not in excess of recent such amounts.
7.7 Limitation on Capital Expenditures. Make or commit to make (by
way of the acquisition of securities of a Person or otherwise) any Capital
Expenditure, except (i) Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business constituting manufacturing costs
incurred between processing periods which are necessary to prepare any factory
for the next processing campaign which are deferred and allocated to the cost of
sugar produced in the subsequent campaign not to exceed $40,000,000 in any
fiscal year and (ii) other Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business not to exceed $45,000,000 in any
fiscal year; provided that any portion of the amount specified in clause (ii)
for any fiscal year that is not expended in such fiscal year may be carried over
to increase the amount of Capital Expenditures permitted under clause (ii) for
the immediately succeeding fiscal year.
7.8 Limitation on Investments, Loans and Advances. Make any advance,
loan, extension of credit (by way of guaranty or otherwise) or capital
contribution to, or purchase any stock, bonds, notes, debentures or other
securities of or any assets constituting all or a material part of a business
unit of, or make any other investment in, any Person, except:
(a) extensions of trade credit in the ordinary course of business;
(b) investments in Cash Equivalents;
(c) Guarantee Obligations permitted by Section 7.2;
61
(d) loans and advances to employees of the Borrower or its
Subsidiaries in the ordinary course of business (including, without
limitation, for travel, entertainment and relocation expenses) in an
aggregate amount for the Borrower and its Subsidiaries not to exceed
$250,000 at any one time outstanding;
(e) the Tender Offer Purchase;
(f) investments by the Borrower or any of its Subsidiaries in the
Borrower or any Person that, prior to such investment, is a Wholly Owned
Subsidiary Guarantor;
(g) investments and reinvestments in the Borrower's portfolio of
marketable securities in the ordinary course of business;
(h) Loans by ▇▇▇▇▇ Finance Company or ▇▇▇▇▇ Sugar Corporation in the
ordinary course of business not to exceed $15,000,000 in the aggregate
outstanding at any time;
(i) advances, loans, extensions of credit existing on the date hereof
and listed on Schedule 7.8(i); and
(j) any other loans or investments not otherwise permitted under this
Section 7.8 having an aggregate amount at any time not in excess of
$10,000,000 (determined at any time as the aggregate initial amount of such
investment or loan less returns or repayments of such investments at or
prior to such time).
7.9 Limitation on Transactions with Affiliates. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property, the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate (other than the
Borrower or any Wholly Owned Subsidiary Guarantor) unless such transaction is
(a) not prohibited under this Agreement and (b) upon fair and reasonable terms
no less favorable to the Borrower or such Subsidiary, as the case may be, than
it would obtain in a comparable arm's length transaction with a Person which is
not an Affiliate. Notwithstanding the foregoing, the Tender Offer, the Tender
Offer Purchase, and the Merger may be consummated.
7.10 Limitation on Sales and Leasebacks. Enter into any arrangement
with any Person providing for the leasing by the Borrower or any Subsidiary of
real or personal property which has been or is to be sold or transferred by the
Borrower or such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of the Borrower or such Subsidiary, other than any
arrangements otherwise expressly permitted hereunder.
7.11 Limitation on Changes in Fiscal Periods. Permit the fiscal year
of the Borrower to end on a day other than March 31 or change the Borrower's
method of determining fiscal quarters, provided that the Borrower may make one
election after the Closing Date to change its fiscal year end, if the Borrower
enters into such amendments to this Agreement as the Syndication Agent shall
request to reflect such change, including modifications to Section 7, such
62
that the covenants affected by such change shall have the same effect (or, in
any case, be substantively no less favorable to the Lenders, in the
determination of the Syndication Agent) after giving effect thereto as if such
change were not made. The Lenders hereby authorize the Syndication Agent and the
Administrative Agent to enter into such amendments to effect such modifications,
if any, in accordance with the provisions of this subsection.
7.12 Limitation on Negative Pledge Clauses. Enter into or suffer to
exist or become effective any agreement which prohibits or limits the ability of
the Borrower or any of its Subsidiaries to create, incur, assume or suffer to
exist any Lien upon any of its Property or revenues, whether now owned or
hereafter acquired, other than (a) this Agreement and the other Loan Documents
and (b) any agreements governing any purchase money Liens or Capital Lease
Obligations otherwise permitted hereby (in which case, any prohibition or
limitation shall only be effective against the assets financed thereby).
7.13 Limitation on Restrictions on Subsidiary Distributions. Enter
into or suffer to exist or become effective any consensual encumbrance or
restriction on the ability of any Subsidiary of the Borrower to (a) pay
dividends or make any other distributions in respect of any Capital Stock of
such Subsidiary held by, or pay any Indebtedness owed to, the Borrower or any
other Subsidiary of the Borrower, (b) make loans or advances to the Borrower or
any other Subsidiary of the Borrower or (c) transfer any of its assets to the
Borrower or any other Subsidiary of the Borrower, except for such encumbrances
or restrictions existing under or by reason of (i) any restrictions existing
under the Loan Documents and (ii) any restrictions with respect to a Subsidiary
imposed pursuant to an agreement which has been entered into in connection with
the Disposition of all or substantially all of the Capital Stock or assets of
such Subsidiary.
7.14 Limitation on Lines of Business. Enter into any business, either
directly or through any Subsidiary, except for (a) those businesses in which the
Borrower or any of its Subsidiaries, or the Target or any of its Subsidiaries,
are engaged on the date of this Agreement and (b) businesses reasonably related
thereto, the revenues of which do not exceed 10% of the Borrower's consolidated
gross revenues.
7.15 Limitation on Amendments to Transaction Documentation. Amend,
supplement or otherwise modify (pursuant to a waiver or otherwise) the terms and
conditions of the Transaction Documentation in any material respect; or fail to
use commercially reasonable efforts to enforce any material right of such Loan
Party under the Merger Agreement.
7.16 Limitation on Optional Payments and Modifications of Debt
Instruments and Organizational Documentation, etc. (a) Make any optional
payment or prepayment on or redemption or purchase of any material Indebtedness
(other than the Loans), (b) amend, modify or change, or consent or agree to any
amendment, modification or change to any of the terms of any such Indebtedness
on terms less favorable to the Borrower and its Subsidiaries or to the interests
of the Lenders than those currently in effect on such Indebtedness, or (c)
amend, modify or change in any material respect, or consent or agree to any
amendment, modification, or change in any material respect to the terms of any
capitalization or organizational documents (including
63
in respect of any Capital Stock); provided, however, that this Section 7.16
shall not prohibit (i) the Borrower or any of its Affiliates from acquiring,
from time to time, any of the Senior Notes which remain outstanding following
consummation or expiration of the Debt Tender Offer in accordance with the terms
thereof and with the terms of the Senior Note Indenture as described in Section
5.1(e) or (ii) the Borrower or any Subsidiary to amend its charter or other
organizational documents to increase the amount of authorized Capital Stock or
other equity thereunder.
SECTION 8. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan or
Reimbursement Obligation when due in accordance with the terms hereof; or
the Borrower shall fail to pay any interest on any Loan or Reimbursement
Obligation, or any other amount payable hereunder or under any other Loan
Document, within five Business Days after any such interest or other amount
becomes due in accordance with the terms hereof; or
(b) Any representation or warranty made or deemed made by any Loan
Party herein or in any other Loan Document or which is contained in any
certificate, document or financial or other statement furnished by it at
any time under or in connection with this Agreement or any such other Loan
Document shall prove to have been inaccurate in any material respect on or
as of the date made or deemed made; or
(c) (i) Any Loan Party shall default in the observance or
performance of any agreement contained in clause (i) or (ii) of Section
6.4(a) (with respect to the Borrower only), Section 6.7(a), Section 7,
Section 5 of the Guarantee and Collateral Agreement or Section 5(b) of the
Target Pledge Agreement or (ii) an "Event of Default" under and as defined
in any Mortgage shall have occurred and be continuing; or
(d) Any Loan Party shall default in the observance or performance of
any other agreement contained in this Agreement or any other Loan Document
(other than as provided in paragraphs (a) through (c) of this Section), and
such default shall continue unremedied for a period of 30 days after notice
to the Borrower from the Administrative Agent or the Required Lenders; or
(e) The Borrower or any of its Subsidiaries shall (i) default in
making any payment of any principal of any Indebtedness (including, without
limitation, any Guarantee Obligation, but excluding the Loans) on the
scheduled or original due date with respect thereto; or (ii) default in
making any payment of any interest on any such Indebtedness beyond the
period of grace, if any, provided in the instrument or agreement under
which such Indebtedness was created; or (iii) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause,
64
or to permit the holder or beneficiary of such Indebtedness (or a trustee
or agent on behalf of such holder or beneficiary) to cause, with the giving
of notice if required, such Indebtedness to become due prior to its stated
maturity or (in the case of any such Indebtedness constituting a Guarantee
Obligation) to become payable; provided, that a default, event or condition
described in clause (i), (ii) or (iii) of this paragraph (e) shall not at
any time constitute an Event of Default under this Agreement unless, at
such time, one or more defaults, events or conditions of the type described
in clauses (i), (ii) and (iii) of this paragraph (e) shall have occurred
and be continuing with respect to Indebtedness the outstanding principal
amount of which exceeds in the aggregate $10,000,000; or
(f) (i) The Borrower or any of its Subsidiaries (other than ▇▇▇▇▇
Finance Company) shall commence any case, proceeding or other action (A)
under any existing or future law of any jurisdiction, domestic or foreign,
relating to bankruptcy, insolvency, reorganization or relief of debtors,
seeking to have an order for relief entered with respect to it, or seeking
to adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition
or other relief with respect to it or its debts, or (B) seeking appointment
of a receiver, trustee, custodian, conservator or other similar official
for it or for all or any substantial part of its assets, or the Borrower or
any of its Subsidiaries (other than ▇▇▇▇▇ Finance Company) shall make a
general assignment for the benefit of its creditors; or (ii) there shall be
commenced against the Borrower or any of its Subsidiaries (other than ▇▇▇▇▇
Finance Company) any case, proceeding or other action of a nature referred
to in clause (i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any of its Subsidiaries (other than ▇▇▇▇▇
Finance Company) any case, proceeding or other action seeking issuance of a
warrant of attachment, execution, distraint or similar process against all
or any substantial part of its assets which results in the entry of an
order for any such relief which shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof; or
(iv) the Borrower or any of its Subsidiaries (other than ▇▇▇▇▇ Finance
Company) shall take any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the acts set forth in clause
(i), (ii), or (iii) above; or (v) the Borrower or any of its Subsidiaries
(other than ▇▇▇▇▇ Finance Company) shall generally not, or shall be unable
to, or shall admit in writing its inability to, pay its debts as they
become due; or
(g) (i) Any Person shall engage in any "prohibited transaction" (as
defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302
of ERISA), whether or not waived, shall exist with respect to any Plan or
any Lien in favor of the PBGC or a Plan shall arise on the assets of the
Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall
occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate,
any Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is, in the reasonable opinion of
the Required Lenders, likely to result in the
65
termination of such Plan for purposes of Title IV of ERISA, (iv) any Single
Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower or any Commonly Controlled Entity shall, or in the reasonable
opinion of the Required Lenders is likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of,
a Multiemployer Plan or (vi) any other event or condition shall occur or
exist with respect to a Plan; and in each case in clauses (i) through (vi)
above, such event or condition, together with all other such events or
conditions, if any, could reasonably be expected to have a Material Adverse
Effect; or
(h) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries (other than ▇▇▇▇▇ Finance Company)
involving in the aggregate a liability (to the extent not paid or fully
covered by insurance as to which the relevant insurance company has
acknowledged coverage) of $10,000,000 or more, and all such judgments or
decrees shall not have been vacated, discharged, stayed or bonded pending
appeal within 30 days from the entry thereof; or
(i) Any of the Security Documents shall cease, for any reason, to be
in full force and effect, or any Loan Party or any Affiliate of any Loan
Party shall so assert, or any Lien created by any of the Security Documents
shall cease to be enforceable and substantially of the same effect and
priority purported to be created thereby; or
(j) The guarantee contained in Section 2 of the Guarantee and
Collateral Agreement shall cease, for any reason, to be in full force and
effect or any Loan Party or any Affiliate of any Loan Party shall so
assert; or
(k) (i) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), (A) shall become, or obtain rights (whether by means or
warrants, options or otherwise) to become, the "beneficial owner" (as
defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or
indirectly, of more than 40% of the outstanding common stock of the
Borrower or (B) shall obtain the right or ability by voting power, contract
or otherwise to elect or designate for election a majority of the Board of
Directors of the Borrower; (ii) the board of directors of the Borrower
shall cease to consist of a majority of Continuing Directors; or (iii) a
Specified Change of Control shall occur;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement and the other Loan Documents (including, without limitation, all
amounts of L/C Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents required
thereunder) shall immediately become due and payable, and (B) if such event is
any other Event of Default, either or both of the following actions may be
taken: (i) with the consent of the Majority Revolving Credit Facility Lenders,
the Administrative Agent may, or upon the request of the Majority Revolving
Credit Facility Lenders, the Administrative Agent shall, by notice to the
Borrower declare the Revolving
66
Credit Commitments to be terminated forthwith, whereupon the Revolving Credit
Commitments shall immediately terminate; and (ii) with the consent of the
Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans hereunder (with accrued interest thereon) and all other
amounts owing under this Agreement and the other Loan Documents (including,
without limitation, all amounts of L/C Obligations, whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented the
documents required thereunder) to be due and payable forthwith, whereupon the
same shall immediately become due and payable. With respect to all Letters of
Credit with respect to which presentment for honor shall not have occurred at
the time of an acceleration pursuant to this paragraph, the Borrower shall at
such time deposit in a cash collateral account opened by the Administrative
Agent an amount equal to the aggregate then undrawn and unexpired amount of such
Letters of Credit. Amounts held in such cash collateral account shall be applied
by the Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower hereunder and under the other Loan Documents. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of
the Borrower hereunder and under the other Loan Documents shall have been paid
in full, the balance, if any, in such cash collateral account shall be returned
to the Borrower (or such other Person as may be lawfully entitled thereto).
SECTION 9. THE AGENTS
9.1 Appointment. Each Lender hereby irrevocably designates and
appoints the Agents as the agents of such Lender under this Agreement and the
other Loan Documents, and each such Lender irrevocably authorizes each Agent, in
such capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to such Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, no Agent shall have any duties or responsibilities,
except those expressly set forth herein, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against any Agent.
9.2 Delegation of Duties. Each Agent may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.
9.3 Exculpatory Provisions. Neither any Agent nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except to the extent that any of the foregoing are found
67
by a final and nonappealable decision of a court of competent jurisdiction to
have resulted from its or such Person's own gross negligence or willful
misconduct) or (ii) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by any Loan Party or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Agents under or in connection with, this Agreement or any
other Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document or
for any failure of any Loan Party a party thereto to perform its obligations
hereunder or thereunder. The Agents shall not be under any obligation to any
Lender to ascertain or to inquire as to the observance or performance of any of
the agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party.
Without limiting the generality of the foregoing, the Collateral Agent shall not
be responsible to any of the Agents or any of the Lenders for the existence,
creation, attachment, perfection or priority of any lien or security interest in
the Collateral or any part thereof or for the existence of any liens, security
interests or other encumbrances or charges thereon.
9.4 Reliance by Administrative Agent. Each Agent shall be entitled
to rely, and shall be fully protected in relying, upon any instrument, writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Loan Parties), independent accountants and
other experts selected by the Administrative Agent. The Agents may deem and
treat the payee of any Note as the owner thereof for all purposes unless a
written notice of assignment, negotiation or transfer thereof shall have been
filed with the Administrative Agent. Each Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders (or, if so specified by this Agreement, all Lenders) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. Each Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement and the other Loan Documents in accordance with a request of the
Required Lenders (or, if so specified by this Agreement, all Lenders), and such
request and any action taken or failure to act pursuant thereto shall be binding
upon all the Lenders and all future holders of the Loans.
9.5 Notice of Default. No Agent shall be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
such Agent has received notice from a Lender or the Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give notice thereof to
the Lenders. The Administrative Agent shall take such action with respect to
such Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if so specified by this Agreement, all Lenders); provided that
unless and until the Administrative Agent shall have received such directions,
the Administrative Agent may (but shall not be obligated to) take such action,
or
68
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.
9.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates have made any
representations or warranties to it and that no act by any Agent hereinafter
taken, including any review of the affairs of a Loan Party or any affiliate of a
Loan Party, shall be deemed to constitute any representation or warranty by any
Agent to any Lender. Each Lender represents to the Agents that it has,
independently and without reliance upon any Agent or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon any Agent or any other Lender, and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit analysis, appraisals and decisions in taking or not taking action
under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, no Agent shall have any duty or responsibility
to provide any Lender with any credit or other information concerning the
business, operations, property, condition (financial or otherwise), prospects or
creditworthiness of any Loan Party or any affiliate of a Loan Party which may
come into the possession of such Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
9.7 Indemnification. The Lenders agree to indemnify each Agent in
its capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Revolving Credit Percentages and Term Loan Percentages in effect on
the date on which indemnification is sought under this Section 9.7 (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such Percentages immediately prior to such date), from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever which may at any
time (including, without limitation, at any time following the payment of the
Loans) be imposed on, incurred by or asserted against such Agent in any way
relating to or arising out of, the Commitments, this Agreement, any of the other
Loan Documents or any documents contemplated by or referred to herein or therein
or the transactions contemplated hereby or thereby or any action taken or
omitted by such Agent under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements which are found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from such Agent's
gross negligence or willful misconduct. The agreements in this Section 9.7
shall survive the payment of the Loans and all other amounts payable hereunder.
69
9.8 Agent in Its Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with any Loan Party as though such Agent was not an Agent. With
respect to its Loans made or renewed by it and with respect to any Letter of
Credit issued or participated in by it, each Agent shall have the same rights
and powers under this Agreement and the other Loan Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms "Lender" and
"Lenders" shall include each Agent in its individual capacity.
9.9 Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent
under this Agreement and the other Loan Documents, then the Required Lenders
shall appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or Section
8(f) with respect to the Borrower shall have occurred and be continuing) be
approved by the Borrower (which approval shall not be unreasonably withheld or
delayed), whereupon such successor agent shall succeed to the rights, powers and
duties of the Administrative Agent, and the term "Administrative Agent" shall
mean such successor agent effective upon such appointment and approval, and the
former Administrative Agent's rights, powers and duties as Administrative Agent
shall be terminated, without any other or further act or deed on the part of
such former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. If no successor agent has accepted appointment as
Administrative Agent by the date that is 30 days following a retiring
Administrative Agent's notice of resignation, the retiring Administrative
Agent's resignation shall nevertheless thereupon become effective and the
Lenders shall assume and perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above. The Syndication Agent may, at any time, by notice
to the Lenders and the Administrative Agent, resign as Syndication Agent
hereunder, whereupon the duties, rights, obligations and responsibilities
hereunder shall automatically be assumed by, and inure to the benefit of, the
Administrative Agent, without any further act by the Syndication Agent, the
Administrative Agent or any Lender. After any retiring Agent's resignation as
Agent, the provisions of this Section 9 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement and the other Loan Documents.
9.10 Authorization to Release Liens. The Administrative Agent is
hereby irrevocably authorized by each of the Lenders to release any Lien
covering any Property of the Borrower or any of its Subsidiaries that is the
subject of a Disposition which is permitted by this Agreement or which has been
consented to in accordance with Section 10.1.
9.11 The Arranger. The Arranger, in its capacity as such, shall have
no duties or responsibilities, and shall incur no liability, under this
Agreement and the other Loan Documents.
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SECTION 10. MISCELLANEOUS
10.1 Amendments and Waivers. Neither this Agreement, any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party party to the relevant Loan Document may, or
(with the written consent of the Required Lenders) the Syndication Agent, the
Administrative Agent and each Loan Party party to the relevant Loan Document
may, from time to time, (a) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders or of the Loan Parties hereunder or thereunder
or (b) waive, on such terms and conditions as the Required Lenders, or the
Agents, as the case may be, may specify in such instrument, any of the
requirements of this Agreement or the other Loan Documents or any Default or
Event of Default and its consequences; provided, however, that no such waiver
and no such amendment, supplement or modification shall (i) forgive the
principal amount or extend the final scheduled date of maturity of any Loan,
extend the scheduled date of any amortization payment in respect of any Term
Loan, reduce the stated rate of any interest, fee or letter of credit commission
payable hereunder or extend the scheduled date of any payment thereof, or
increase the amount or extend the expiration date of any Lender's Revolving
Credit Commitment, in each case without the consent of each Lender directly
affected thereby; (ii) amend, modify or waive any provision of this Section 10.1
or reduce any percentage specified in the definition of Required Lenders,
consent to the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement and the other Loan Documents, release all or
substantially all of the Collateral or release all or substantially all of the
Subsidiary Guarantors from their obligations under the Guarantee and Collateral
Agreement, in each case without the written consent of all Lenders; (iii) amend,
modify or waive any condition precedent to any extension of credit under the
Revolving Credit Facility set forth in Section 5.3 (including, without
limitation, in connection with any waiver of an existing Default or Event of
Default) without the written consent of the Majority Revolving Credit Facility
Lenders; (iv) reduce the percentage specified in the definition of Majority
Facility Lenders without the written consent of all Lenders under each affected
Facility; (v) amend, modify or waive any provision of Section 9 without the
written consent of the Agents; or (vi) amend, modify or waive any provision of
Section 3 without the written consent of the Issuing Lender; provided, further,
notwithstanding the provisions set forth above, no Lender consent shall be
required in connection with the release of any Liens on Property sold by the
Borrower or its Subsidiaries if such sale is permitted pursuant to Section 7.5.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties, the
Lenders, the Administrative Agent and all future holders of the Loans. In the
case of any waiver, the Loan Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
other Loan Documents, and any Default or Event of Default waived shall be deemed
to be cured and not continuing; but no such waiver shall extend to any
subsequent or other Default or Event of Default, or impair any right consequent
thereon.
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10.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower, the Syndication
Agent, the Collateral Agent and the Administrative Agent, and as set forth in an
administrative questionnaire delivered to the Administrative Agent in the case
of the Lenders, or to such other address as may be hereafter notified by the
respective parties hereto:
The Borrower: Imperial ▇▇▇▇▇ Corporation
One Imperial Square, Suite 200
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇-▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention:
Telecopy:
Telephone:
The Syndication Agent and
the Administrative Agent:
▇▇▇▇▇▇ Commercial Paper Inc.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
The Collateral Agent: ▇▇▇▇▇▇ Trust and Savings Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Agribusiness Division
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
provided that any notice, request or demand to or upon either Agent or the
Lenders shall not be effective until received.
10.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of either Agent or any Lender, any right,
remedy, power or privilege
72
hereunder or under the other Loan Documents shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
10.4 Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.
10.5 Payment of Expenses. The Borrower agrees (a) to pay or reimburse
the Agents for all their reasonable out-of-pocket costs and expenses incurred in
connection with the development, preparation and execution of, and any
amendment, supplement or modification to, this Agreement and the other Loan
Documents (except for any costs or expenses specifically excluded in the
commitment letter executed by the Borrower and the Syndication Agent in respect
of the credit facilities provided for herein) and any other documents prepared
in connection herewith or therewith, and the consummation and administration of
the transactions contemplated hereby and thereby, including, without limitation,
the reasonable fees and disbursements of counsel to the Administrative Agent,
(b) to pay or reimburse each Lender and the Agents for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the reasonable fees and disbursements
of counsel (including the allocated fees and expenses of in-house counsel) to
each Lender and of counsel to the Agents, (c) to pay, indemnify, and hold each
Lender and the Agents harmless from, any and all recording and filing fees or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement, the other Loan Documents and any such other
documents, and (d) to pay, indemnify, and hold each Lender and the Agents and
their respective officers, directors, employees, affiliates, agents and
controlling persons (each, an "indemnitee") harmless from and against any and
all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Loan Documents and any such other
documents, including, without limitation, any of the foregoing relating to the
use of proceeds of the Loans or the violation of, noncompliance with or
liability under, any Environmental Law applicable to the operations of the
Borrower any of its Subsidiaries or any of the Properties (all the foregoing in
this clause (d), collectively, the "indemnified liabilities"), provided, that
the Borrower shall have no obligation hereunder to any indemnitee with respect
to indemnified liabilities to the extent such indemnified liabilities resulted
from the gross negligence or willful misconduct of such indemnitee. Without
limiting the foregoing, and to the extent permitted by applicable law, the
Borrower agrees not to assert and hereby waives, and shall cause each of its
Subsidiaries not to assert and to waive, all rights of contribution or any other
rights of recovery with respect to all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any
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Indemnitee. The agreements in this Section 10.5 shall survive repayment of the
Loans and all other amounts payable hereunder.
10.6 Successors and Assigns; Participations and Assignments. (a)
This Agreement shall be binding upon and inure to the benefit of the Borrower,
the Lenders, the Agents, all future holders of the Loans and their respective
successors and assigns, except that the Borrower may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agents and each Lender.
(b) Any Lender may, without the consent of the Borrower, in
accordance with applicable law, at any time sell to one or more banks, financial
institutions or other entities (each, a "Participant") participating interests
in any Loan owing to such Lender, any Commitment of such Lender or any other
interest of such Lender hereunder and under the other Loan Documents. In the
event of any such sale by a Lender of a participating interest to a Participant,
such Lender's obligations under this Agreement to the other parties to this
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Loan for all purposes under this Agreement and the other Loan Documents, and the
Borrower and the Agents shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement and the other Loan Documents. In no event shall any Participant under
any such participation have any right to approve any amendment or waiver of any
provision of any Loan Document, or any consent to any departure by any Loan
Party therefrom, except to the extent that such amendment, waiver or consent
would reduce the principal of, or interest on, the Loans or any fees payable
hereunder, or postpone the date of the final maturity of the Loans, in each case
to the extent subject to such participation. The Borrower agrees that if
amounts outstanding under this Agreement and the Loans are due or unpaid, or
shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall, to the maximum extent
permitted by applicable law, be deemed to have the right of setoff in respect of
its participating interest in amounts owing under this Agreement to the same
extent as if the amount of its participating interest were owing directly to it
as a Lender under this Agreement, provided that, in purchasing such
participating interest, such Participant shall be deemed to have agreed to share
with the Lenders the proceeds thereof as provided in Section 10.7(a) as fully as
if it were a Lender hereunder. The Borrower also agrees that each Participant
shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 with respect
to its participation in the Commitments and the Loans outstanding from time to
time as if it was a Lender; provided that, in the case of Section 2.16, such
Participant shall have complied with the requirements of said Section and
provided, further, that no Participant shall be entitled to receive any greater
amount pursuant to any such Section than the transferor Lender would have been
entitled to receive in respect of the amount of the participation transferred by
such transferor Lender to such Participant had no such transfer occurred.
(c) Any Lender (an "Assignor") may, in accordance with applicable
law, at any time and from time to time, subject to the consent of the
Syndication Agent, assign to any Lender or any affiliate thereof or, with the
consent of the Borrower and the Agents (which, in each case, shall not be
unreasonably withheld or delayed) (provided that no such consent need be
obtained
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for assignments involving ▇▇▇▇▇▇ Commercial Paper Inc.), to an additional bank,
financial institution or other entity (an "Assignee") all or any part of its
rights and obligations under this Agreement pursuant to an Assignment and
Acceptance, substantially in the form of Exhibit E, executed by such Assignee,
such Assignor, the Syndication Agent and the Administrative Agent (and, where
the consent of the Borrower is required pursuant to the foregoing provisions, by
the Borrower) and delivered to the Administrative Agent for its acceptance and
recording in the Register; provided that no such assignment to an Assignee
(other than any Lender or any affiliate thereof) shall be in an aggregate
principal amount of less than $5,000,000 (other than in the case of an
assignment of all of a Lender's interests under this Agreement), unless
otherwise agreed by the Borrower, the Syndication Agent and the Administrative
Agent. Any such assignment need not be ratable as among the Facilities. Upon
such execution, delivery, acceptance and recording, from and after the effective
date determined pursuant to such Assignment and Acceptance, (x) 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 Lender hereunder
with a Commitment and/or Loans as set forth therein, and (y) the Assignor
thereunder shall, to the extent provided in such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of an Assignor's rights and obligations
under this Agreement, such assigning Lender shall cease to be a party hereto).
Notwithstanding any provision of this Section 10.6, the consent of the Borrower
shall not be required for any assignment which occurs at any time when any of
the events described in Section 8(f) shall have occurred and be continuing.
(d) The Administrative Agent shall maintain at its address referred
to in Section 10.2 a copy of each Assignment and Acceptance delivered to it and
a register (the "Register") for the recordation of the names and addresses of
the Lenders and the Commitment of, and principal amount of the Loans owing to,
each Lender from time to time and any Notes evidencing such Loans. The entries
in the Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders shall treat each Person whose
name is recorded in the Register as the owner of the Loan and any Note
evidencing such Loan recorded therein for all purposes of this Agreement. Any
assignment of any Loan whether or not evidenced by a Note shall be effective
only upon appropriate entries with respect thereto being made in the Register
(and each Note shall expressly so provide). Any assignment or transfer of all
or part of a Loan evidenced by a Note shall be registered on the Register only
upon surrender for registration of assignment or transfer of the Note evidencing
such Loan, accompanied by a duly executed Assignment and Acceptance, and
thereupon one or more new Notes in the same aggregate principal amount shall be
issued to the designated Assignee and the old Notes shall be returned by the
Administrative Agent to the Borrower marked "cancelled". The Register shall be
available for inspection by the Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender, an Assignee and the Syndication Agent (and, in the case of an
Assignee that is not then a Lender or an affiliate thereof or a Person under
common management with such Lender, by the Borrower, the Administrative Agent
and the Issuing Lender) together with payment to the Administrative Agent of a
registration and processing fee of $3,500 (except that no such
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registration and processing fee shall be payable in connection with an
assignment by ▇▇▇▇▇▇ Commercial Paper Inc.), the Administrative Agent shall (i)
promptly accept such Assignment and Acceptance and (ii) on the effective date
determined pursuant thereto record the information contained therein in the
Register and give notice of such acceptance and recordation to the Lenders and
the Borrower. On or prior to such effective date, the Borrower, at its own
expense, upon request, shall execute and deliver to the Administrative Agent (in
exchange for the Revolving Credit Note and/or Term Notes, as the case may be, of
the assigning Lender) a new Revolving Credit Note and/or Term Notes, as the case
may be, to the order of such Assignee in an amount equal to the Revolving Credit
Commitment and/or applicable Term Loans, as the case may be, assumed or acquired
by it pursuant to such Assignment and Acceptance and, if the assigning Lender
has retained a Revolving Credit Commitment and/or Term Loans, as the case may
be, upon request, a new Revolving Credit Note and/or Term Notes, as the case may
be, to the order of the assigning Lender in an amount equal to the Revolving
Credit Commitment and/or applicable Term Loans, as the case may be, retained by
it hereunder. Such new Notes shall be dated the Closing Date and shall otherwise
be in the form of the Note replaced thereby.
(f) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this Section 10.6 concerning assignments of Loans and
Notes relate only to absolute assignments and that such provisions do not
prohibit assignments creating security interests, including, without limitation,
any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve
Bank in accordance with applicable law.
10.7 Adjustments; Setoff. (a) Except to the extent that this
Agreement provides for payments to be allocated to the Lenders under a
particular Facility, if any Lender (a "Benefitted Lender") shall at any time
receive any payment of all or part of its Loans or the Reimbursement Obligations
owing to it, or interest thereon, or receive any collateral in respect thereof
(whether voluntarily or involuntarily, by setoff, pursuant to events or
proceedings of the nature referred to in Section 8(f), or otherwise), in a
greater proportion than any such payment to or collateral received by any other
Lender, if any, in respect of such other Lender's Loans or the Reimbursement
Obligations owing to such other Lender, or interest thereon, such Benefitted
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Loan and/or of the Reimbursement
Obligations owing to each such other Lender, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such Benefitted Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the Lenders;
provided, however, that if all or any portion of such excess payment or benefits
is thereafter recovered from such Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
setoff and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits,
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indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by such Lender or any branch or agency thereof to or for the credit or the
account of the Borrower. Each Lender agrees promptly to notify the Borrower and
the Administrative Agent after any such setoff and application made by such
Lender, provided that the failure to give such notice shall not affect the
validity of such setoff and application.
10.8 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
10.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 Integration. This Agreement and the other Loan Documents
represent the entire agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its Property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which
it is a party, or for recognition and enforcement of any judgment in
respect thereof, to the non-exclusive general jurisdiction of the courts of
the State of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
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(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to the
Borrower at its address set forth in Section 10.2 or at such other address
of which the Administrative Agent shall have been notified pursuant
thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to ▇▇▇ in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to
in this Section 10.12 any special, exemplary, punitive or consequential
damages.
10.13 Acknowledgements. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection
with this Agreement or any of the other Loan Documents, and the
relationship between Administrative Agent and Lenders, on one hand, and the
Borrower, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among
the Lenders or among the Borrower and the Lenders.
10.14 WAIVERS OF JURY TRIAL. THE BORROWER, THE AGENTS AND THE LENDERS
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
10.15 Confidentiality. Each of the Agents and each Lender agrees to
keep confidential all non-public information provided to it by any Loan Party
pursuant to this Agreement that is designated by such Loan Party as
confidential; provided that nothing herein shall prevent any Agent or any Lender
from disclosing any such information (a) to the Administrative Agent, any other
Lender or any affiliate of any Lender, (b) to any Participant or Assignee (each,
a "Transferee") or prospective Transferee which agrees to comply with the
provisions of this Section 10.15, (c) to the employees, directors, agents,
attorneys, accountants and other professional advisors of such Lender or its
affiliates, (d) upon the request or demand of any Governmental Authority having
jurisdiction over the such Agent or such Lender, (e) in response to any order of
any court or other Governmental Authority or as may otherwise be
78
required pursuant to any Requirement of Law, (f) if requested or required to do
so in connection with any litigation or similar proceeding, provided that such
Agent will use commercially reasonable efforts to give notice to the Borrower
thereof, (g) which has been publicly disclosed other than in breach of this
Section 10.15, (h) to the National Association of Insurance Commissioners or any
similar organization or any nationally recognized rating agency that requires
access to information about a Lender's investment portfolio in connection with
ratings issued with respect to such Lender, or (i) in connection with the
exercise of any remedy hereunder or under any other Loan Document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
IMPERIAL ▇▇▇▇▇ CORPORATION
By: /s/▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President and Treasurer
▇▇▇▇▇▇ COMMERCIAL PAPER INC., as
Syndication Agent, Issuing Bank and as a
Lender
By:________________________________________
Name:
Title:
▇▇▇▇▇▇ COMMERCIAL PAPER INC., as
Administrative Agent
By:________________________________________
Name:
Title:
▇▇▇▇▇▇ TRUST AND SAVINGS BANK, as
Collateral Agent
By:________________________________________
Name:
Title: