EXHIBIT 4.1
AMENDED AND RESTATED
$30,000,000
LONG TERM CREDIT AGREEMENT
among
TBC CORPORATION
as the Borrower,
THE LENDING INSTITUTIONS PARTY HERETO,
as the Lenders
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
as the Administrative Agent,
and
THE CHASE MANHATTAN BANK
as the Syndication Agent and Sole Book Manager
dated as of
November 9, 1998
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS................................................................. 1
ARTICLE II
THE CREDITS................................................................. 14
2.1 Commitment........................................................ 14
2.2 Letter of Credit Subfacility...................................... 14
2.2.1 Obligation to Issue......................................... 14
2.2.2 Procedure for Issuance of Facility L/C...................... 14
2.2.3 Participation in Facility L/C............................... 15
2.2.4 Facility L/C Fee............................................ 17
2.2.5 Reimbursement for Draws Under Facility L/C's................ 18
2.2.6 Issuing Lender Reporting Requirements....................... 20
2.2.7 Indemnification; Assumption of Risk......................... 20
2.2.8 Letter of Credit Collateral Account......................... 21
2.2.9 Letter of Credit Applications............................... 21
2.3 Ratable Loans; Types of Advances.................................. 21
2.4 Fees.............................................................. 21
2.4.1 Arranger's Fee.............................................. 21
2.4.2 Administrative Agent's Fee.................................. 21
2.4.3 Commitment Fees............................................. 21
2.5 Reductions in Aggregate Commitment................................ 22
2.6 Minimum Amount of Each Advance.................................... 22
2.7 Optional Principal Payments....................................... 22
2.8 Method of Selecting Types and Interest Periods for New Advances... 22
2.9 Conversion and Continuation of Outstanding Advances............... 22
2.10 Changes in Interest Rate, etc..................................... 23
2.11 Rates Applicable After Default.................................... 23
2.12 Method of Payment................................................. 24
2.13 Notes; Telephonic Notices......................................... 24
2.14 Interest Payment Dates; Interest and Fee Basis.................... 24
2.15 Notification of Advances. Interest Rates. Prepayments and Commitment
Reduction......................................................... 25
2.16 Lending Installations............................................. 25
2.17 Non-Receipt of Funds by the Administrative Agent.................. 25
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ARTICLE III
CHANGE IN CIRCUMSTANCES..................................................... 25
3.1 Yield Protection.................................................. 25
3.2 Changes in Capital Adequacy Regulations........................... 26
3.3 Availability of Types of Advances................................. 27
3.4 Funding Indemnification........................................... 27
3.5 Lender Statements; Survival of Indemnity.......................... 27
ARTICLE IV
CONDITIONS PRECEDENT; WITHHOLDING TAX EXEMPTION............................. 27
4.1 Initial Advances.................................................. 27
4.2 Each Advance...................................................... 27
4.3 Withholding Tax Exemption......................................... 29
ARTICLE V
REPRESENTATIONS AND WARRANTIES.............................................. 30
5.1 Corporate Existence and Standing.................................. 30
5.2 Authorization and Validity........................................ 30
5.3 No Conflict: Government Consent................................... 30
5.4 Financial Statements.............................................. 31
5.5 Material Adverse Change........................................... 31
5.6 Taxes............................................................. 31
5.7 Litigation and Contingent Obligations............................. 31
5.8 Subsidiaries...................................................... 31
5.9 ERISA............................................................. 31
5.10 Accuracy of Information........................................... 32
5.11 Regulation U...................................................... 32
5.12 Material Agreements............................................... 32
5.13 Compliance With Laws.............................................. 32
5.14 Ownership of Properties........................................... 32
5.15 Plan Assets: Prohibited Transactions.............................. 32
5.16 Environmental Matters............................................. 32
5.17 Investment Company Act............................................ 33
ARTICLE VI
COVENANTS................................................................... 33
6.1 Financial Reporting............................................... 33
6.2 Use of Proceeds................................................... 34
6.3 Notice of Default................................................. 34
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6.4 Conduct of Business............................................... 34
6.5 Taxes ............................................................ 35
6.6 Insurance......................................................... 35
6.7 Compliance with Laws.............................................. 35
6.8 Environmental Covenant............................................ 35
6.9 Maintenance of Properties......................................... 35
6.10 Inspection........................................................ 35
6.11 Dividends......................................................... 36
6.12 Merger............................................................ 36
6.13 Indebtedness...................................................... 36
6.14 Sale of Assets.................................................... 36
6.15 Liens............................................................. 37
6.16 Affiliates........................................................ 38
6.17 [Reserved]........................................................ 38
6.18 Consolidated Tangible Net Worth................................... 38
6.19 Consolidated Total Liabilities.................................... 38
6.20 Fixed Charge Coverage Ratio....................................... 38
6.21 [Reserved]........................................................ 38
6.22 Retail Stores Under Development................................... 38
6.23 Minimum Working Capital........................................... 39
6.24 Employee Benefit Plans............................................ 39
6.25 Other Agreements.................................................. 39
ARTICLE VII
DEFAULTS.................................................................... 39
ARTICLE VIII
ACCELERATION WAIVERS, AMENDMENTS AND REMEDIES............................... 41
8.1 Acceleration...................................................... 41
8.2 Amendments........................................................ 42
8.3 Preservation of Rights............................................ 43
ARTICLE IX
GENERAL PROVISIONS.......................................................... 43
9.1 Survival of Representations....................................... 43
9.2 Governmental Regulation........................................... 43
9.3 Taxes............................................................. 43
9.4 Headings.......................................................... 43
9.5 Entire Agreement.................................................. 43
9.6 Several Obligations: Benefits of this Agreement................... 43
9.7 Expenses: Indemnification......................................... 44
9.8 Numbers of Documents.............................................. 44
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9.9 Accounting........................................................ 44
9.10 Severability of Provisions........................................ 44
9.11 Nonliability of Lenders........................................... 44
9.12 Confidentiality................................................... 45
9.13 Nonreliance....................................................... 45
ARTICLE X
THE ADMINISTRATIVE AGENT.................................................... 45
10.1 Appointment; Nature of Relationship............................... 45
10.2 Powers............................................................ 46
10.3 General Immunity.................................................. 46
10.4 No Responsibility for Loans, Recitals, etc........................ 46
10.5 Action on Instructions of Lenders................................. 46
10.6 Employment of Agents and Counsel.................................. 46
10.7 Reliance on Documents Counsel..................................... 47
10.8 Administrative Agent's Reimbursement and Indemnification.......... 47
10.9 Notice of Default................................................. 47
10.10 Rights as a Lender............................................... 47
10.11 Lender Credit Decision........................................... 48
10.12 Successor Administrative Agent................................... 48
ARTICLE XI
SETOFF; RATABLE PAYMENTS.................................................... 48
11.1 Setoff............................................................ 48
11.2 Ratable Payments.................................................. 49
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS........................... 49
12.1 Successors and Assigns............................................ 49
12.2 Participations.................................................... 49
12.2.1 Permitted Participants; Effect............................. 49
12.2.2 Voting Rights.............................................. 50
12.2.3 Benefit of Setoff.......................................... 50
12.3 Assignments....................................................... 50
12.3.1 Permitted Assignments...................................... 50
12.3.2 Effect; Effective Date..................................... 50
12.4 Dissemination of Information...................................... 51
12.5 Tax Treatment..................................................... 51
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ARTICLE XIII
NOTICES..................................................................... 51
13.1 Notices........................................................... 51
13.2 Change of Address................................................. 52
ARTICLE XIV
COUNTERPARTS................................................................ 52
ARTICLE XV
CHOICE OF LAW, CONSENT TO JURISDICTION, WAIVER OF JURY TRIAL............... 52
15.1 Choice of Law..................................................... 52
15.2 Consent to Jurisdiction........................................... 52
15.3 Waiver of Jury Trial.............................................. 52
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EXHIBITS
EXHIBIT "A" NOTE ......................................................A-1
EXHIBIT "B" FORM OF OPINION ...........................................B-1
EXHIBIT "C" COMPLIANCE CERTIFICATE ....................................C-1
EXHIBIT "D" ASSIGNMENT AGREEMENT ......................................D-1
EXHIBIT "E" LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION............ E-1
EXHIBIT "F" GUARANTY ................................................. F-1
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This Amended and Restated Long Term Credit Agreement (the "Agreement")
is entered into this the 9th day of November, 1998, by and among TBC
CORPORATION ("Borrower"), FIRST TENNESSEE BANK NATIONAL ASSOCIATION as
administrative agent ( "Administrative Agent") for itself as Lender and the
other undersigned Lenders, THE CHASE MANHATTAN BANK, as Lender and as the
syndication agent and sole book manager ("Syndication Agent"), and SUNTRUST
BANK, NASHVILLE, N.A. ("Lender").
W I T N E S S E T H:
WHEREAS, TBC Corporation, NBD Bank (now known as First National Bank of
Chicago) as Co-Agent and a Lender, First Tennessee Bank National Association
as Administrative Agent and a Lender, and Suntrust Bank, Nashville, N.A., as
a Lender, entered into a Long Term Credit Agreement on September 25, 1996
(the "Long Term Agreement"); and
WHEREAS, such parties agreed to amend the September 25, 1996 Long Term
Credit Agreement on the following dates: July 1, 1997; October 28, 1997;
December 17, 1997; and October 14, 1998 (the "Amendments"); and
WHEREAS, The Chase Manhattan Bank has agreed to replace First National
Bank of Chicago as a Lender under the Long Term Agreement as amended by the
Amendments, upon assignment by First National Bank of Chicago of its rights
hereunder and under the other Loan Documents; and
WHEREAS, the parties to this Agreement have agreed to enter into an
Amended and Restated Long Term Credit Agreement for the purpose of
consolidating the Long Term Agreement as amended by the Amendments, and to
evidence the substitution of The Chase Manhattan Bank for First National Bank
of Chicago as a Lender hereunder;
NOW, THEREFORE, for valuable consideration the receipt of which is
hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which
the Borrower or any of its Subsidiaries (i) acquires any going business or
all or substantially all of the assets of any firm, corporation, partnership,
joint venture, or limited liability company, or division thereof, or any
other entity, whether through purchase of assets, merger or otherwise or (ii)
directly or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in number of
votes) of the securities of a corporation which have ordinary voting power
for the election of directors (other
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than securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the outstanding
ownership interests of a partnership or limited liability company, or joint
venture or any other entity.
"Acquisition Agreement" means the acquisition documents entered into
between the Borrower and Big O pursuant to the Big O Acquisition.
"Administrative Agent" means First Tennessee Bank in its capacity as
administrative agent for the Lenders pursuant to Article X and not in its
individual capacity as a Lender, and any successor Administrative Agent
appointed pursuant to Article X.
"Administrative Agent's Fee Letter" means the letter agreement dated
September 25, 1996 between the Administrative Agent and the Borrower, as
amended, modified, supplemented or replaced from time to time.
"Advance" means a borrowing hereunder (or conversion or continuation
thereof) consisting of the aggregate amount of the several Loans made on the
same Borrowing Date (or date of conversion or continuation) by the Lenders to
the Borrower of the same Type and, in the case of Eurodollar Advances, for
the same Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10%
or more of any class of voting securities (or other ownership interests) of
the controlled Person or possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of the controlled
Person, whether through ownership of stock, by contract or otherwise.
"Aggregate Commitment" means the aggregate of the Commitments of all
the Lenders. as reduced from time to time pursuant to the terms hereof
"Aggregate Outstandings" means, at any date of determination, the
aggregate of the Outstandings of all the Lenders as of such date of
determination.
"Agreement" means this Amended and Restated Long Term Credit Agreement,
as it may be amended or modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day or (ii) the
sum of Federal Funds Effective Base Rate for such day plus 1/2% per annum.
"Applicable Percentage" means for any day, the rate per annum set forth
below opposite the applicable ratio of (a) the Funded Indebtedness of the
Borrower at the end of the preceding fiscal quarter then most recently ended
to (b) EBITDA of the Borrower for the preceding four fiscal quarters then
most recently ended, it being understood that the Applicable Percentage for
(i) Floating Rate Advances shall be the percentage set forth under the column
"Floating Rate Advance Margin",
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(ii) Eurodollar Advances shall be the percentage set forth under the column
"Eurodollar Advance Margin", and (iii) the Commitment Fee shall be the
percentage set forth under the column "Commitment Fee":
Funded Eurodollar Floating Rate
Indebtedness Advance Margin Advance Margin Commitment Fee
to EBITDA
<=1.5 0.450% 0% 0.175%
>1.5 but <=2.25 0.600% 0% 0.200%
>2.25 but <=3.00 0.750% 0% 0.225%
>3.00 0.875% 0% 0.250%
The Applicable Percentage shall, in each case, be determined and
adjusted quarterly on the first day of the month after the date of delivery
of the quarterly compliance certificate and financial information provided in
accordance with Sections 6.1(ii) and 6.1(iii), as appropriate, provided,
however, that if such compliance certificate and financial information are
not delivered within two Business Days after the date required hereunder
(each an "Interest Determination Date"), the Applicable Percentage shall
increase to the maximum percentage amount set forth in the table above from
the date such compliance certificate and financial statements were required
to be delivered to the Administrative Agent until received by the
Administrative Agent. The Applicable Percentage shall be effective from an
Interest Determination Date until the next such Interest Determination Date.
The Administrative Agent shall determine the appropriate Applicable
Percentages promptly upon receipt of the quarterly or annual financial
information and promptly notify the Borrower and the Lenders of any change
thereof. Such determinations by the Administrative Agent shall be conclusive
absent demonstrable error. The initial Applicable Percentages shall be 0% in
the case of Floating Rate Loans, 0.750% in the case of Eurodollar Loans, and
0.225% in the case of the Commitment Fee, until the first Interest
Determination Date occurring after the Closing Date;
"Arranger" means First Chicago Capital Markets, Inc.
"Arranger's Fee Letter" means the letter agreement dated as of May 24,
1996 between the Arranger and the Borrower.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means any of the President, Senior Vice President
Operations and Treasurer or Vice President and Controller of the Borrower,
acting singly.
"Big O" means Big O Tires, Inc., a Nevada corporation.
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"Big O Acquisition" means the acquisition by the Borrower of all of the
outstanding shares of Big O for a total aggregate purchase price not
exceeding $60,000,000, which occurred contemporaneously with the execution
and delivery of the Long Term Agreement.
"Borrower" means TBC Corporation, a Delaware corporation, and its
successors and assigns.
"Borrowing Date" means a date on which an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing, Facility L/C
issuance, payment or rate selection of Eurodollar Advances, a day (other than
a Saturday or Sunday) on which banks generally are open in Memphis and New
York for the conduct of substantially all of their commercial lending
activities and on which dealings in United States dollars are carried on in
the London interbank market and (ii) for all other purposes, a day (other
than a Saturday or Sunday) on which banks generally are open in Memphis for
the conduct of substantially all of their commercial lending activities.
"Capital Expenditure" means, for any Person and for any period of its
determination, the aggregate of all expenditures and costs (whether paid in
cash or accrued as liabilities during that period and including that portion
of Capital Leases placed in effect during that period which is capitalized on
the balance sheet of such Person) of such Person during such period that, in
conformity with GAAP, are required to be included in or reflected by the
property, plant, or equipment, or any similar fixed asset or long term
capitalized asset accounts reflected in the balance sheet of such Person.
Capital Expenditures does not include amounts attributed to construction or
development of Retail Stores Under Development.
"Capitalized Lease" of a Person means any lease of Property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with GAAP.
"Change in Control" means the acquisition by any Person, or two or more
Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 20% or more of the outstanding shares of voting
stock of the Borrower.
"Chase" means The Chase Manhattan Bank, a New York banking corporation,
in its individual capacity, and its successors and assigns.
"Closing Date" means the date on which the conditions set forth in
Section 4.1 were fulfilled under the Long Term Agreement.
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"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commercial L/C Fee Rate" means, at any time, one percent (1.0%) per
annum.
"Commitment" means, for each Lender, the obligation of such Lender to
make Loans and to participate in Facility L/C's as provided herein not
exceeding the amount set forth opposite its signature below or as set forth
in any Notice of Assignment relating to any assignment that has become
effective pursuant to Section 12.3.2, as such amount may be modified from
time to time pursuant to the terms hereof
"Commitment Fee" is defined in Section 2.4.3.
"Condemnation" is defined in Section 7.8.
"Consolidated Funded Indebtedness" means, at any date, all Funded
Indebtedness of the Borrower and its Subsidiaries at such date, determined on
a consolidated basis.
"Consolidated Net Income" means, for any period, the consolidated net
income or loss of the Borrower and its Subsidiaries for such period,
determined in accordance with GAAP.
"Consolidated Net Worth" means, at any date, the consolidated net worth
of the Borrower and its Subsidiaries at such date, determined in accordance
with GAAP.
"Consolidated Tangible Net Worth" means, at any date, Consolidated Net
Worth after subtracting therefrom the aggregate amount of all intangible
assets of the Borrower and its Subsidiaries, including, without limitation,
goodwill, franchises, licenses, patents, trademarks, trade names, copyrights,
service marks, brand names and operating rights, all determined in accordance
with GAAP.
"Consolidated Total Liabilities" means at any date, the consolidated
total liabilities of the Borrower and its subsidiaries at such date,
determined in accordance with GAAP, plus Contingent Obligations, (excluding
intercompany obligations).
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes
or is contingently liable upon, the obligation or liability of any other
Person, or agrees to maintain the net worth or working capital or other
financial condition of any other Person, or otherwise contractually assures
any creditor of such other Person against loss, which shall include any
recourse deficiency amount or guaranteed residual portion under any Synthetic
Lease.
"Conversion/Continuation Notice" is defined in Section 2.9.
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"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower or any of its Subsidiaries,
are treated as a single employer under Section 414 of the Code.
"Corporate Base Rate" means a rate per annum equal to the prime rate of
interest announced by First Tennessee Bank from time to time, changing when
and as said prime rate changes.
"Default" means an event described in Article VII.
"EBIT" means, with respect to the Borrower and its Subsidiaries and for
any period of its determination, the Consolidated Net Income of the Borrower
and its Subsidiaries for such period, plus the consolidated interest expense,
and taxes, all determined in accordance with GAAP consistently applied.
"EBITDA" means, with respect to the Borrower and its Subsidiaries and
for any period of determination, EBIT of the Borrower and its Subsidiaries
for such period, plus depreciation and amortization of the Borrower and its
Subsidiaries for such period, all determined in accordance with GAAP.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating
to (i) the protection of the environment, (ii) the effect of the environment
on human health, (iii) emissions, discharges or releases of pollutants,
contaminants, hazardous substances or wastes into surface water, ground water
or land, or (iv) the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants,
hazardous substances or wastes or the clean-up or other remediation thereof
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which bears interest at a
Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the rate per annum equal to the applicable
London interbank offered rate for U.S. Dollar deposits appearing on Telerate
Page 3750 as of 11:00 a.m. London time two (2) Business Days prior to the
first day of such Interest Period (and if no London interbank offered rate of
such maturity then appears on Telerate Page 3750, then the Eurodollar Rate
shall be equal to the London interbank offered rate for U.S. Dollar Deposits
maturing immediately before or immediately after such maturity, whichever is
higher, as determined by the Administrative Agent from Telerate Page 3750)
for the number of days comprised therein and in an amount equal to the amount
of the Eurodollar Loan to be outstanding during such Interest Period.
"Eurodollar Loan" means a Loan which bears interest at a Eurodollar Rate.
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"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, a rate per annum equal to the sum of (i) the
quotient of (a) the Eurodollar Base Rate applicable to such Interest Period,
divided by (b) one minus the Reserve Requirement (expressed as a decimal)
applicable to such Interest Period, if any, plus (ii) the Applicable Margin.
The Eurodollar Rate shall be rounded to the next higher multiple of 1/16 of
1% if the rate is not such a multiple.
"Existing Letters of Credit" means those Letters of Credit issued by the
Issuing Lender and in existence on the Closing Date, all as described on
Schedule "3".
"Facility L/C" means a Letter of Credit issued, or deemed issued under
this Agreement pursuant to Section 2.2.1.
"Facility L/C Commitment" means $5,000,000.
"Federal Funds Effective Base Rate" means, for any day, an interest rate
per annum equal to the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published for such day on page 120 of
Telerate Data Service (or, if such day is not a Business Day, for the
immediately preceding Business Day), or, if such rate is not so published for
any day which is a Business Day, the average of the quotations at
approximately 10:00 a.m. (Memphis time) on such day on such transactions
received by the Administrative Agent from three Federal finds brokers of
recognized standing selected by the Administrative Agent in its sole
discretion.
"First Tennessee Bank" means First Tennessee Bank National Association,
in its individual capacity, and its successors.
"Fixed Charge Coverage Ratio" means as of the last day of any fiscal
quarter of the Borrower, the ratio of (a) EBIT plus rental payments for the
period of four fiscal quarters ending on the last day of such quarter to (b)
the sum of (i) the Borrower's and its Subsidiaries consolidated interest
expense and rental payments (each as defined under GAAP) for such period.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day, changing when and as the Alternate Base
Rate changes.
"Floating Rate Advance" means an Advance which bears interest at the
Floating Rate.
"Floating Rate Loan" means a Loan which bears interest at the Floating
Rate.
"Funded Indebtedness" of any Person as of any particular date of
computation means, without duplication, the aggregate Indebtedness of such
Person outstanding on the date of computation.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and in the statements and
pronouncements of the Financial Accounting Standards Board or in such other
statement by such other entity as may be the circumstances as of the date of
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determination, consistently applied. If at any time any change in GAAP would
affect the computation of any financial ratio or requirement set forth in
this Agreement, the Administrative Agent, the Lenders and the Borrower shall
negotiate in good faith to amend such ratio or requirement to reflect such
change in GAAP (subject to the approval of the Required Lenders), provided
that, until so amended, (i) such ratio or requirement shall continue to be
computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of
such ratio or requirement made before and after giving effect to such change
in GAAP.
"Guaranties" means the guaranties dated September 25, 1996 executed and
delivered by the Guarantors pursuant to Section 4.1, which were substantially
in the form of Exhibit "F", as amended, supplemented or otherwise modified
from time to time.
"Guarantors" means each of TBC Sales, Inc., TBC International, Inc. and
Big O Tires, Inc.
"Hazardous Material" means (i) any Hazardous Substance; (ii) any
Hazardous Waste; (iii) any petroleum product; or (iv) any pollutant or
contaminant or hazardous, dangerous or toxic chemical, material or substance
within the meaning of any other federal, state or local law, regulation,
ordinance or requirement (including consent decrees and administrative
orders) relating to or imposing liability or standards of conduct concerning
any hazardous, toxic or dangerous waste, substance or material, all as
amended or hereafter amended.
"Hazardous Substance" means any "hazardous substance," as defined by
CERCLA.
"Hazardous Waste" means any "hazardous waste," as defined by the
Resource Conservation and Recovery Act, as amended.
"Indebtedness" means, as to any Person, at a particular time, all items
which constitute, without duplication, (i) indebtedness for borrowed money or
the deferred purchase price of Property (other than trade payables incurred
in the ordinary course of business), (ii) indebtedness evidenced by notes,
bonds, debentures or similar instruments, (iii) obligations with respect to
any conditional sale or title retention agreement, (iv) indebtedness arising
under acceptance facilities and the amount available to be drawn under all
letters of credit (other than Commercial Letters of Credit) issued for the
account of such Person and, without duplication, all drafts drawn thereunder
to the extent such Person shall not have reimbursed the issuer in respect of
the issuer's payment of such drafts, (v) all liabilities secured by any Lien
on any Property owned by such Person even though such Person has not assumed
or otherwise become liable for the payment thereof [other than (A) carriers',
warehousemen's, mechanics', repairmen's or other like non-consensual
statutory Liens arising in the ordinary course of business and (B)
liabilities of Subsidiaries for which recourse may be had by the creditor
only to the Property secured by the Lien], (vi) Capitalized Lease
Obligations, and (vii) Contingent Obligations, other than Intercompany
Contingent Obligations.
"Intercompany Contingent Obligation" means a Contingent Obligation
pursuant to which the Borrower or a Subsidiary is contingently liable solely
with respect to a primary obligation of the
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Borrower or any Subsidiary and such primary obligation is included among the
liabilities shown on the Borrower's consolidated balance sheets to be
submitted to the Lenders pursuant to Section 6.1.
"Interest Period" means, with respect to a Eurodollar Advance, a period
of one, two, three, or six months commencing on a Business Day selected by
the Borrower pursuant to this Agreement. Such Interest Period shall end on
the day which corresponds numerically to such date one, two, three, or six
months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third, or sixth succeeding month,
such Interest Period shall end on the last Business Day of such next, second,
third, or sixth succeeding month. If an Interest Period would otherwise end
on a day which is not a Business Day, such Interest Period shall end on the
next succeeding Business Day, provided, however, that if said next succeeding
Business Day falls in a new calendar month, such Interest Period shall end on
the immediately preceding Business Day.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable and
trade acceptances arising in the ordinary course of business on terms
customary in the trade) or contribution of capital by such Person; stocks,
bonds, mutual funds, partnership interests, notes, debentures or other
securities owned by such Person; any deposit accounts and certificate of
deposit owned by such Person; and structured notes, derivative financial
instruments and other similar instruments or contracts owned by such Person.
"Issuing Lender" means First Tennessee Bank National Association.
"L/C Participation Amount" means, for each Lender at any date of
determination, such Lender's Percentage of the aggregate undrawn amount
available (whether or not the conditions which would allow a draw thereunder
have been met) to the beneficiaries thereof under all outstanding Facility
L/C's as of such date of determination.
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the
Administrative Agent, any office, branch, subsidiary or affiliate of such
Lender or the Administrative Agent.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way
liable, and shall be either (i) a standby letter of credit issued to support
obligations of the Borrower, contingent or otherwise (a "Standby Letter of
Credit"), or (ii) a commercial letter of credit issued in respect of the
purchase of inventory or other goods or services by the Borrower in the
ordinary course of business (a "Commercial Letter of Credit"). Commencing
on the Closing Date, the Existing Letters of Credit were deemed to be Letters
of Credit issued under this Agreement.
"Letter of Credit Collateral Account" is defined in Section 2.2.8.
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"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind
or nature whatsoever (including, without limitation, the interest of a vendor
or lessor under any conditional sale, Capitalized Lease or other title
retention agreement).
"Loan" means, with respect to a Lender, such Lender's loan made pursuant
to Article II (or any conversion or continuation thereof).
"Loan Documents" means this Agreement, the Notes, the Guaranties and any
applications for Facility L/Cs executed and delivered by the Borrower
pursuant to Section 2.2.2.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of
operations, or prospects of the Borrower or the Borrower and its Subsidiaries
taken as a whole, (ii) the ability of the Borrower to perform its obligations
under the Loan Documents, or (iii) the validity or enforceability of any of
the Loan Documents or the rights or remedies of the Administrative Agent or
the Lenders thereunder.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Note" means a promissory note, in substantially the form of Exhibit "A"
hereto, duly executed by the Borrower and payable to the order of a Lender in
the amount of its Commitment, including any amendment, modification, renewal
or replacement of such promissory note.
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Notes, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Borrower to the
Lenders or to any Lender, the Administrative Agent or any indemnified party
hereunder arising under the Loan Documents.
"Outstandings" means, for each Lender at any date of determination, the
sum of (a) the aggregate outstanding principal amount of all Loans made by
such Lender as of the date of determination, plus (b) such Lender's L/C
Participation Amount as of the date of determination, plus (c) such Lender's
Percentage of any Unreimbursed Drawings outstanding as of the date of
determination.
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each March, June, September, and
December.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
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"Percentage" means, for any Lender, 100% times a fraction (a) the
numerator of which is such Lender's Commitment, and (b) the denominator of
which is the Aggregate Commitment.
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or
other entity or organization, or any government or political subdivision or
any agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of
the Code as to which the Borrower or any member of the Controlled Group may
have any liability.
"Private Placement" means the private placement of debt by the Borrower
with the Prudential Insurance Company of America or its affiliates for the
purpose of, among other things, funding the Big O Acquisition.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets
owned, leased or operated by such Person
"Purchasers" is defined in Section 12.3.1.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors
relating to the extension of credit by banks for the purpose of purchasing or
carrying margin stocks applicable to member banks of the Federal Reserve
System.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a
Plan, excluding, however, such events as to which the PBGC by regulation
waived the requirement of Section 4043(a) of ERISA that it be notified within
thirty (30) days of the occurrence of such event, provided, however, that a
failure to meet the minimum funding standard of Section 412 of the Code and
of Section 302 of ERISA shall be a Reportable Event regardless of the
issuance of any such waiver of the notice requirement in accordance with
either Section 4043(a) of ERISA or Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 51% of
the Aggregate Commitment or, if the Aggregate Commitment has been eliminated,
Lenders in the aggregate holding at least 51% of the total of the aggregate
unpaid principal amount of the aggregate holding at least 51% of the total of
the aggregate unpaid principal amount of the outstanding Advances, L/C
Participation Amounts, and Percentages of Unreimbursed Drawings.
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"Reserve Requirement" means the maximum aggregate reserve requirement
(including all basic, supplemental, marginal and other reserves) which is
imposed under Regulation D on Eurocurrency liabilities.
"Retail Stores Under Development" means retail stores under development
or construction by Big O which are shown as such by the Borrower on its
balance sheet.
"Revolving Credit Termination Balance" means the aggregate principal
amount of Advances outstanding on the Termination Date after giving effect to
any Advances made or repaid on such date.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Short Term Credit Agreement" means the amended and restated short term
credit agreement entered into among the Borrower, the Lenders and the
Administrative Agent as of the Closing Date.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"Standby L/C Fee Rate" means a percentage amount per annum equal to the
Applicable Percentage for Eurodollar Advances.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the
time be owned or controlled, directly or indirectly, by such Person or by one
or more of its Subsidiaries or by such Person and one or more of its
Subsidiaries, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization more than 50% of
the ownership interests having ordinary voting power of which shall at the
time be so owned or controlled. Unless otherwise expressly provided, all
references herein to a "Subsidiary" shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the
Borrower and its Subsidiaries, Property which (i) represents more than 10% of
the consolidated assets of the Borrower and its Subsidiaries as would be
shown in the consolidated financial statements of the Borrower and its
Subsidiaries as at the beginning of the twelve-month period ending with the
month in which such determination is made, or (ii) is responsible for more
than 10% of the consolidated net sales or of the consolidated net income of
the Borrower and its Subsidiaries as reflected in the financial statements
referred to in clause (i) above.
"Syndication Agent" means The Chase Manhattan Bank, a New York banking
corporation, in its capacity as Syndication Agent and Sole Book Manager.
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"Synthetic Leases" means any lease entered into by Borrower pursuant to
the lease program with Suntrust Capital Markets, Inc., and any future lease
that evidences a transaction that satisfies the requirements of the Statement
of Financial Accounting Standards No. 13 (SFAS 13) promulgated by the
Financial Accounting Standards Board and the Emerging Issues Task Force of
the Financial Accounting Standards Board (1990) (EITF 90-15) that is
classified as a lease for financial accounting purposes and as a loan for tax
purposes.
"Termination Date" means the date which is 364 days after the Closing
Date, or such earlier date of termination of the Lenders' obligations
pursuant to Section 8.1 upon the occurrence of an Event of Default.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or Eurodollar Advance.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Unreimbursed Drawing" is defined in Section 2.2.3(b).
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more
Wholly-Owned Subsidiaries of such Person, or by such Person and one or more
Wholly-Owned Subsidiaries of such Person, or (ii) any partnership, limited
liability company, association, joint venture or similar business
organization 100% of the ownership interests having ordinary voting power of
which shall at the time be so owned or controlled.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
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ARTICLE II
THE CREDITS
2.1 Commitment. From and including the date of this Agreement and
prior to the Termination Date, each Lender severally agrees, on the terms and
conditions set forth in this Agreement, to make Loans to the Borrower from
time to time in amounts (combined with such Lender's L/C Participation
Amount) not to exceed in the aggregate at any one time outstanding the amount
of its Commitment and provided that, after giving effect to the making of any
Loan, the Aggregate Outstandings do not exceed the Aggregate Commitment. In
furtherance and not in limitation of the foregoing, any unused portion of the
Facility L/C Commitment shall be available for the making of Loans hereunder,
up to the Aggregate Commitment. Subject to the terms of this Agreement, the
Borrower may borrow, repay and reborrow Loans at any time prior to the
Termination Date and may borrow to pay draws under Facility L/C's pursuant to
Section 2.2.5(b) at any time prior to the Termination Date. The Commitments
to lend hereunder shall expire on the Termination Date except as otherwise
provided for draws under Facility L/C's. Any outstanding Advances,
Unreimbursed Drawings, and all other unpaid Obligations shall be paid in full
by the Borrower on the Termination Date.
2.2 Letter of Credit Subfacility.
2.2.1 Obligation to Issue. Subject to the terms and conditions
of this Agreement, from and including the date of this Agreement and on
or before the Termination Date, the Issuing Lender agrees to issue
Facility L/C's for the account of the Borrower from time to time in
amounts such that, after giving effect to the issuance of any Facility
L/C (i) the aggregate undrawn amount available (whether or not the
conditions which would allow a draw thereunder have been met) to the
beneficiaries thereof under all outstanding Facility L/C's does not
exceed the Facility L/C Commitment, and (ii) the Aggregate Outstandings
do not exceed the Aggregate Commitment. Each Facility L/C shall be
denominated in U. S. dollars. The issuance of a Facility L/C shall be
deemed to be a utilization of the Aggregate Commitment for all purposes
under this Agreement. No Facility L/C may have an expiry date occurring
after the Termination Date. Notwithstanding anything in this Agreement
to the contrary, the Issuing Lender shall not be required to issue a
Facility L/C supporting an underwriting, remarketing, or placement by
the Issuing Lender or any Affiliate of the Issuing Lender.
2.2.2 Procedure for Issuance of Facility L/C. (a) The Borrower
shall give the Issuing Lender and the Administrative Agent notice of any
requested issuance of a Facility L/C under this Agreement not later than
10:00 a.m. (Memphis time) at least two Business Days' prior to the
requested date of issuance, together with such other documents and
materials as the Issuing Lender may require (including, without
limitation and at the Issuing Lender's discretion, a duly executed
application, as may be amended from time to time, for a Letter of Credit
on the Issuing Lender's standard form for such transactions (the "L/C
Application" and a form of which is attached hereto as Exhibit "G")).
Such notice shall be irrevocable and shall specify the stated amount of
the Facility L/C requested, the effective
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date (which day shall be a Business Day) of issuance of such requested
Facility L/C, the date on which such requested Facility L/C is to expire
(which date shall be a Business Day occurring on or before the
Termination Date), the purpose for which such Facility L/C is to be
issued, and the Person for whose benefit the requested Facility L/C is
to be issued. At the time such request is made, the Borrower shall also
provide the Issuing Lender and the Administrative Agent with a copy of
the form of the Facility L/C it is requesting be issued, if any, which
proposed Facility L/C shall be reasonably satisfactory to the Issuing
Lender as to form and content. Prior to the close of business on the
second Business Day following the Business Day on which the
Administrative Agent first received such notice, the Administrative
Agent shall confirm by written notice (including via facsimile), or
telephone notice confirmed promptly thereafter in writing, to the
Issuing Lender whether the Issuing Lender is authorized to issue the
requested Facility L/C in accordance with subsection 2.2.2(b) below.
(b) The Administrative Agent shall determine, as of the close of
business on the day it receives a notice from the Borrower pursuant to
subsection 2.2.2(a) above, whether after giving effect to the issuance
of the requested Facility L/C (i) the aggregate undrawn amount available
(whether or not the conditions which would allow a draw thereunder have
been met) to the beneficiaries thereof under all outstanding Facility
L/CIs would exceed the Facility L/C Commitment, and (ii) the Aggregate
Outstandings would exceed the Aggregate Commitment. If, and only if, the
stated amount of the requested Facility L/C would not exceed such
limitations, and subject to the terms and conditions of this Section 2.2
and provided that the applicable conditions set forth in Section 4.2
hereof have been satisfied, the Issuing Lender shall, on the requested
date, issue a Facility L/C on behalf of the Borrower in accordance with
the Issuing Lender's usual and customary business practices.
(c) The Issuing Lender shall give the Administrative Agent written
or telex notice, or telephonic notice confirmed promptly thereafter in
writing, of the issuance of a Facility L/C.
(d) The Issuing Lender shall not extend or amend any Facility L/C
unless the requirements of this Section 2.2.2 are met as though a new
Facility L/C was being requested and issued.
2.2.3 Participation in Facility L/C.
(a) Immediately upon the issuance of each and every Facility L/C,
each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Issuing Lender, without recourse or
warranty, an undivided interest and participation to the extent of each
Lender's Percentage in each Facility L/C (including, without limitation,
all obligations of the Borrower with respect thereto and any security
therefor other than amounts owing pursuant to the last sentence of
Section 2.2.4(c) and any security therefor).
(b) In the event that the Issuing Lender makes any payment under
any Facility L/C and the Borrower shall not have repaid such amount (an
"Unreimbursed Drawing") to the
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Issuing Lender pursuant to Section 2.2.5 hereof (with the proceeds of an
Advance or otherwise), the Issuing Lender shall promptly notify the
Administrative Agent, which shall promptly notify each Lender, of such
failure (by facsimile, or telephone promptly confirmed in writing), and
each Lender shall promptly and unconditionally pay to the Administrative
Agent for the account of the Issuing Lender the amount of such Lender's
Percentage of such payment in same day funds. If the Administrative
Agent so notifies a Lender prior to noon (Memphis time) on any Business
Day, such Lender shall make available to the Administrative Agent for
the account of the Issuing Lender its Percentage of the amount of such
payment on such Business Day in same day funds. If and to the extent
such Lender shall not have so made its Percentage of the amount of such
payment available to the Administrative Agent for the account of the
Issuing Lender, such Lender agrees to pay to the Administrative Agent
for the account of the Issuing Lender forthwith on demand such amount
together with interest thereon, for each day from the date such payment
was first due until the date such amount is paid to the Administrative
Agent for the account of the Issuing Lender, at the Federal Funds
Effective Base Rate. The failure of any Lender to make available to the
Administrative Agent for the account of the Issuing Lender its
Percentage of any such payment shall not relieve any other Lender of its
obligation hereunder to make available to the Administrative Agent for
the account of the Issuing Lender its Percentage of any payment on the
date such payment is to be made.
(c) Whenever the Issuing Lender receives a payment on account of
an Unreimbursed Drawing, including any interest thereon, as to which the
Administrative Agent has received payments from the Lenders for the
account of the Issuing Lender pursuant to this Section 2.2.3, it shall
promptly pay to the Administrative Agent and the Administrative Agent
shall promptly pay to each Lender which has funded its participating
interest therein, in the kind of funds so received, an amount equal to
such Lender's Percentage thereof. Each such payment shall be made by the
Issuing Lender on the Business Day on which it receives the funds paid
to it pursuant to the preceding sentence, if received prior to noon
(Memphis time) on such Business Day, and otherwise on the next
succeeding Business Day.
(d) Upon the request of either the Administrative Agent or any
Lender, the Issuing Lender shall furnish to the Administrative Agent or
such Lender copies of any Letter of Credit application to which the
Issuing Lender is a party and such other documentation as may reasonably
be requested by the Administrative Agent or such Lender. Promptly after
the issuance of each Facility L/C, the Issuing Lender shall send a copy
of such Facility L/C to the Administrative Agent and each Lender by
telefacsimile.
(e) The obligations of a Lender to make payments to the
Administrative Agent for the account of the Issuing Lender with respect
to a Facility L/C shall be irrevocable, not subject to any qualification
or exception whatsoever and shall be made in accordance with the terms
and conditions of this Agreement under all circumstances, including,
without limitation, any of the following circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Loan Documents;
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(ii) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against a beneficiary
named in a Facility L/C or any transferee of any Facility L/C (or
any Person for whom any such transferee may be acting), the
Administrative Agent, the Issuing Lender, any Lender, or any other
Person, whether in connection with this Agreement, any Facility
L/C, the transactions contemplated herein or any unrelated
transactions (including any underlying transactions between the
Borrower or any Affiliate of the Borrower and the beneficiary named
in any Facility L/C);
(iii) any draft, certificate of any other document
presented under the Facility L/C proving to be forged, fraudulent
or invalid in any respect, or insufficient in accordance with the
Uniform Customs and Practice for Documentary Credits (1993
revision), International Chamber of Commerce, Publication 500, or
any statement therein being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents; or
(v) the occurrence of any Default or Unmatured Default;
provided, that the Lenders shall not be required to fund their
participations in a Facility L/C if the corresponding payment made by
the Issuing Lender under such Facility L/C was made as a result of the
Issuing Lender's gross negligence or willful misconduct or failure to
negotiate a draft in accordance with the standard of care required by
the Uniform Customs and Practice for Documentary Credits (1993
revision), International Chamber of Commerce, Publication 500.
(f) In the event any payment by the Borrower received by the
Issuing Lender with respect to a Facility L/C and distributed by the
Administrative Agent to the Lenders on account of their participations
is thereafter set aside, avoided or recovered from that Issuing Lender
in connection with any receivership, liquidation, reorganization or
bankruptcy proceeding, each Lender which received such distribution
shall, upon demand by that Issuing Lender, contribute such Lender's
Percentage of the amount set aside, avoided or recovered together with
interest at the rate required to be paid by that Issuing Lender upon the
amount required to be repaid by it.
2.2.4 Facility L/C Fee.
(a) The Borrower hereby agrees to pay to the Issuing Lender and
the Lenders a fee (calculated for the actual number of days elapsed on
the basis of a year consisting of 360 days) with respect to each
Commercial Letter of Credit issued under this Agreement with respect to
the period from the date of issuance of such Commercial Letter of Credit
to the expiration or termination date of such Letter of Credit, computed
at a rate per annum equal to the Commercial L/C Fee Rate on the average
aggregate amount available to be drawn under such Commercial Letter of
Credit during the period for which such fee is calculated
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provided, however, that no such fee shall be due with respect to the
Existing Letters of Credit.
(b) The Borrower hereby agrees to pay to the Issuing Lender and
the Lenders a fee (calculated for the actual number of days elapsed on
the basis of a year consisting of 360 days) with respect to each Standby
Letter of Credit issued under this Agreement with respect to the period
from the date of issuance of such Standby Letter of Credit to the
expiration or termination date of such Letter of Credit, computed at a
rate equal to the Standby L/C Fee Rate of the average aggregate amount
available to be drawn under such Standby Letter of Credit during the
period for which such fee is calculated; provided, however, that no such
fee shall be due with respect to the Existing Letters of Credit.
(c) In consideration of its issuance of a Facility L/C, the
Borrower hereby additionally agrees to pay to the Issuing Lender for its
own account a fee for its own account (calculated for the actual number
of days elapsed on the basis of a year consisting of 360 days) on any
undrawn portion of such Facility L/C from time to time outstanding equal
to .10% per annum.
(d) All fees due under this Section 2.2.4 shall be payable in
arrears to the Administrative Agent for the account of the Issuing
Lender and the Lenders at the principal office of the Administrative
Agent in Memphis, Tennessee on each Payment Date, on the Termination
Date, and on the expiration date of each Facility L/C or when such
Facility L/C is fully drawn, whichever first occurs. The Borrower also
hereby agrees to pay directly to the Issuing Lender with respect to each
Facility L/C issued for the Borrower's account the usual and customary
administrative and other charges of the Issuing Lender in connection
with any Facility L/C, including, without limitation, a charge of $100
for the issuance of any Facility L/C and charges for the negotiation of
any draft paid pursuant to any Facility L/C and any amendments or
supplements to any Facility L/C.
2.2.5 Reimbursement for Draws Under Facility L/C's.
(a) Promptly upon receipt of notice from the Issuing Lender of any
drawing under a Facility L/C, the Borrower hereby agrees to reimburse
the Lenders ratably in accordance with their respective Percentages by
making a payment to the Issuing Lender for the amount of each draft
drawn or purporting to be drawn under any such Facility L/C for the
account of the Borrower which is paid by the Issuing Lender, except to
the extent that any of the foregoing arises solely from the Issuing
Lender's gross negligence, willful misconduct or failure to negotiate
the draft in accordance with the standard of care required by the
Uniform Customs and Practice for Documentary Credits (1993 revision),
International Chamber of Commerce, Publication 500. Unless funded with
an Advance made pursuant to Section 2.2.5(b), amounts which the Borrower
has agreed to reimburse the Lenders pursuant to the preceding sentence
shall be due on demand and shall bear interest until paid at a rate per
annum (calculated for the actual number of days elapsed on the basis of
year consisting of 360 days) equal to the Floating Rate plus 2% per
annum.
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(b) The payment by the Issuing Lender of a draft drawn under or
purporting to be drawn under any Facility L/C shall be deemed to
constitute a Borrowing Notice for a Floating Rate Advance in the amount
of such draft and, subject to the terms and conditions of this Agreement
(including, without limitation, that (i) the provisions of Section 4.2
shall have been satisfied or waived and (ii) after giving effect to such
Advance, the Aggregate Outstandings will not exceed the Aggregate
Available Commitment), the Lenders shall make such Floating Rate Advance
and the Administrative Agent shall apply the proceeds thereof to the
payment of the Borrower's obligations under Section 2.2.5(a) with
respect to such draft.
(c) The Borrower's obligation to make all payments due under
Section 2.2.5(a) shall be absolute, unconditional and irrevocable, and
such payments shall be made strictly in accordance with the terms of
this Agreement, under all circumstances whatsoever, including, without
limitation, any or all of the following circumstances:
(i) any determination of invalidity or unenforceability with
respect to any Facility L/C after payment by the Issuing Lender; or
(ii) any lack of validity or enforceability of any or all or
the Loan Documents; or
(iii) any amendment to, waiver of, any consent under or
departure from any or all of the Loan Documents; or
(iv) any exchange, release or nonperfection of any collateral
securing any Facility L/C, or any release or amendment or waiver of
or consent to departure from any guaranty of any Facility L/C; or
(v) the existence of any claim, set-off, defense or other
right which the Borrower may have at any time against a beneficiary
of any Facility L/C (or any entities for whom such beneficiary may
be acting), the Lenders, the Issuing Lenders, the Administrative
Agent or any other Person; or
(vi) any statement or any other document presented under any
Facility L/C proving to be forged (unless the Issuing Lender failed
to discover such forging solely as a result of its own gross
negligence or willful misconduct), fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any
respect whatsoever.
(d) The Issuing Lender shall use its best efforts to give prompt
notice to the Borrower of the presentation of a draft under a Facility
L/C; provided, that failure to give such notice shall not limit or
otherwise affect the Borrower's obligations under this Agreement except
as explicitly provided herein.
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2.2.6 Issuing Lender Reporting Requirements. In addition to
the reports required by Section 2.2.2(c), the Issuing Lender shall, no
later than the tenth Business Day following the last day of each month,
provide to the Administrative Agent a schedule of Facility L/C's issued
by it, in form and substance reasonably satisfactory to the
Administrative Agent, showing the date of issue, account party, amount,
expiration date and the reference number of each Facility L/C issued by
it outstanding at any time during such month and the aggregate amount
payable by the Borrower during the month pursuant. Copies of such
reports shall be provided promptly to the Borrower and each Lender by
the Administrative Agent.
2.2.7 Indemnification; Assumption of Risk.
(a) The Borrower hereby agrees to indemnify and hold harmless the
Administrative Agent, the Issuing Lender and each Lender from and
against any and all claims, damages, losses, liabilities, costs or
expenses of any kind which any thereof may incur by reason of or in
connection with the execution and delivery, issuance or transfer of, or
any payment or failure to pay under, any Facility L/C; provided, the
Borrower shall not be required to indemnify the Issuing Lender for any
claims, damages, losses, liabilities, costs or expenses to the extent
caused by the gross negligence, wilful misconduct, or failure to
negotiate the draft in accordance with the standard of care required by
the Uniform Customs and Practice for Documentary Credits (1993
revision), International Chamber of Commerce, Publication 500 on the
part of the Issuing Lender in making payment under a Facility L/C.
(b) The Borrower assumes all risks of the acts or omissions of any
beneficiary of any Facility L/C issued for its account with respect to
its use or reliance on any such Facility L/C. Neither the Lenders, the
Issuing Lender, nor the Administrative Agent shall be responsible for:
the validity or genuineness of certificates or other documents delivered
under or with any Facility L/C, even if such certificates or other
documents should in fact prove to be invalid, fraudulent or forged;
errors, omissions, interruptions or delays in transmission or delivery
of any messages, by mail, cable, telegraph, wireless or otherwise,
whether or not they are in code; errors in translation or for errors in
interpretation of technical terms; any failure or inability by any
Lender, the Issuing Lender or the Administrative Agent or anyone else to
perform under the foreign laws, customs or regulations or by reason of
any control or restriction rightfully or wrongfully exercised by any
government or group asserting or exercising governmental or paramount
powers; or any other consequences arising from causes beyond any
Lender's, the Issuing Lender's or the Administrative Agent's control;
nor shall any Lender, the Issuing Lender, or the Administrative Agent be
responsible for any error, neglect, or default of any correspondent of
such Person; and none of the above shall affect, impair or prevent the
vesting of any of the rights or powers of any Lender, the Issuing Lender
or the Administrative Agent under any of the Loan Documents. The Issuing
Lender may accept statements, certificates or other documents that
appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary.
In furtherance and not in limitation of the foregoing provisions, the
Borrower agrees that any action taken by any Lender, the Issuing Lender
or the Administrative Agent in good faith in connection with any
Facility L/C, or the relevant drafts, certificates or other documents,
shall be binding on the Borrower and shall not result in any liability
of such Lender, the Issuing
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Lender or the Administrative Agent to the Borrower except as provided in
the parenthetical phrase which appears in Section 2.2.5(c)(vi) or
otherwise resulting solely from the gross negligence or willful
misconduct of the Issuing Lender, the Administrative Agent or any Lender
or the failure of the Issuing Lender to negotiate a Facility L/C in
accordance with the standard of care required by the Uniform Customs and
Practice for Documentary Credits (1993 revision), International Chamber
of Commerce, Publication 500; and the Borrower makes like agreement as
to any inaction or omission.
2.2.8 Letter of Credit Collateral Account. From and after the
occurrence and during the continuance of a Default, the Borrower hereby
agrees that it will, until the Termination Date, maintain a special
collateral account (the "Letter of Credit Collateral Account") at the
Administrative Agent's office at the address specified pursuant to
Article XIII, in the name of the Borrower but under the sole dominion
and control of the Administrative Agent, for the benefit of the Lenders,
and in which the Borrower shall have no interest other than as set forth
in Section 8.1. In addition to the foregoing, the Borrower hereby grants
to the Administrative Agent, for the benefit of the Lenders, a security
interest in and to the Letter of Credit Collateral Account and any funds
that may hereafter be on deposit in such account.
2.2.9 Letter of Credit Applications. To the extent that any
provision of any L/C Application related to any Letter of Credit is
inconsistent with this Agreement, the provisions of this Agreement shall
apply.
2.3 Ratable Loans; Types of Advances. Each Advance hereunder shall
consist of Loans made from the several Lenders ratably in proportion to the
ratio that their respective Commitments bear to the Aggregate Commitment. The
Advances may be Floating Rate Advances or Eurodollar Advances, or a
combination thereof, selected by the Borrower in compliance with Sections 2.8
and 2.9.
2.4 Fees.
2.4.1 Arranger's Fee. The Borrower agrees to pay to the
Arranger, for its own account, the fees referred to in the
Arranger's Fee Letter (the "Arranger's Fees").
2.4.2 Administrative Agent's Fee. The Borrower agrees to pay
to the Administrative Agent, for its own account, the administrative and
other fees referred to in the Administrative Agent's Fee Letter (the
"Administrative Agent's Fee").
2.4.3 Commitment Fees. The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee in
the amount of the Applicable Percentage on the daily unused portion of
such Lender's Commitment (which unused portion includes the unissued
portion of the Facility L/C Commitment) from the date hereof to and
including the Termination Date, payable in arrears on each Payment Date
hereafter and on the Termination Date (the "Commitment Fee").
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2.5 Reductions in Aggregate Commitment. The Borrower may permanently
reduce the Aggregate Commitment in whole, or in part ratably among the
Lenders in a minimum amount of $2,000,000 and in integral multiples of
$1,000,000 in excess thereof, upon at least five Business Days' written
notice to the Administrative Agent, which notice shall specify the amount of
any such reduction, provided, however, that the amount of the Aggregate
Commitment may not be reduced below the aggregate principal amount of the
Aggregate Outstandings. All accrued commitment fees shall be payable on the
effective date of any termination of the obligations of the Lenders to make
Loans hereunder.
2.6 Minimum Amount of Each Advance. Each Eurodollar Advance shall be
in the minimum amount of $ 1,000,000 (and in integral multiples of $500,000
if in excess thereof), and each Floating Rate Advance shall be in the minimum
amount of $100,000 (and in multiples of $50,000 if in excess thereof),
provided, however, that any Floating Rate Advance may be in the amount of the
unused Aggregate Commitment.
2.7 Optional Principal Payments. The Borrower may from time to time
pay, without penalty or premium, all outstanding Floating Rate Advances, or,
in a minimum aggregate amount of $2,000,000 or any integral multiple of
$1,000,000 in excess thereof, any portion of the outstanding Floating Rate
Advances. A Eurodollar Advance may be prepaid prior to the last day of the
applicable Interest Period upon three Business Days' prior written notice to
the Administrative Agent, subject to Section 3.4.
2.8 Method of Selecting Types and Interest Periods for New Advances.
The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable to each Advance from time
to time. The Borrower shall give the Administrative Agent irrevocable notice
(a "Borrowing Notice") not later than 11:30 a.m. (Memphis time) on the
Borrowing Date of each Floating Rate Advance and three Business Days before
the Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of
such Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest
Period applicable thereto.
Not later than 2:00 p.m. (Memphis time) on each Borrowing Date, each Lender
shall make available its Loan or Loans, in funds immediately available in
Memphis to the Administrative Agent at its address specified pursuant to
Article XIII. The Administrative Agent will make the funds so received from
the Lenders available to the Borrower at the Administrative Agent's aforesaid
address.
2.9 Conversion and Continuation of Outstanding Advances. Floating Rate
Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into
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Eurodollar Advances. Each Eurodollar Advance of any Type shall continue as a
Eurodollar Advance of such Type until the end of the then applicable Interest
Period therefor, at which time such Eurodollar Advance shall be automatically
converted into a Floating Rate Advance unless the Borrower shall have given
the Administrative Agent a Conversion/Continuation Notice requesting that, at
the end of such Interest Period, such Eurodollar Advance either continue as a
Eurodollar Advance of such Type for the same or another Interest Period or be
converted into an Advance of another Type. Subject to the terms of Section
2.6 and Section 3.4, the Borrower may elect from time to time to convert all
or any part of an Advance of any Type into any other Type or Types of
Advances. The Borrower shall give the Administrative Agent irrevocable notice
(a "Conversion/Continuation Notice") of each conversion of an Advance or
continuation of a Eurodollar Advance not later than 10:00 a.m. (Memphis time)
at least one Business Day, in the case of a conversion into a Floating Rate
Advance or three Business Days, in the case of a conversion into or
continuation of a Eurodollar Advance, prior to the date of the requested
conversion or continuation, specifying:
(i) the requested date which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Advance which is to
be converted or continued, and
(iii) the amount and Type(s) of Advance(s) into which such
Advance is to be converted or continued and, in the case of a
conversion into or continuation of a Eurodollar Advance, the
duration of the Interest Period applicable thereto.
2.10 Changes in Interest Rate, etc. Each Floating Rate Advance
shall bear interest on the outstanding principal amount thereof, for each day
from and including the date such Advance is made or is converted from a
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.9 to
but excluding the date it becomes due or is converted into a Eurodollar
Advance pursuant to Section 2.9 hereof, at a rate per annum equal to the
Floating Rate for such day. Changes in the rate of interest on that portion
of any Advance maintained as a Floating Rate Advance will take effect
simultaneously with each change in the Alternate Base Rate. Each Eurodollar
Advance shall bear interest on the outstanding principal amount thereof from
and including the first day of the Interest Period applicable thereto to (but
not including) the last day of such Interest Period at the interest rate
determined as applicable to such Eurodollar Advance. No Interest Period may
end after the Termination Date.
2.11 Rates Applicable After Default. Notwithstanding anything to
the contrary contained in Section 2.8 or 2.9, during the continuance of a
Default or Unmatured Default the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that
no Advance may be made as, converted into or continued as a Eurodollar
Advance. During the continuance of a Default the Required Lenders may, at
their option, by notice to the Borrower (which notice may be revoked at the
option of the Required Lenders notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates),
declare that (i) each Eurodollar Advance shall bear interest for the
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remainder of the applicable Interest Period at the rate otherwise applicable
to such Interest Period plus 2% per annum and (ii) each Floating Rate Advance
shall bear interest at a rate per annum equal to the Floating Rate otherwise
applicable to the Floating Rate Advance plus 2% per annum.
2.12 Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Administrative Agent at the Administrative Agent's
address specified pursuant to Article XIII, or at any other Lending
Installation of the Administrative Agent specified in writing by the
Administrative Agent to the Borrower, by noon (local time) on the date when
due and shall be applied ratably by the Administrative Agent among the
Lenders. Each payment delivered to the Administrative Agent for the account
of any Lender shall be delivered promptly by the Administrative Agent to such
Lender in the same type of funds that the Administrative Agent received at
its address specified pursuant to Article XIII or at any Lending Installation
specified in a notice received by the Administrative Agent from such Lender.
The Administrative Agent may charge the account of the Borrower maintained
with the Administrative Agent for each payment of principal, interest and
fees as it becomes due hereunder if so directed by the Borrower from time to
time or, if an Event of Default has occurred and is then continuing, at the
Administrative Agent's discretion.
2.13 Notes; Telephonic Notices. Each Lender is hereby authorized to
record the principal amount of each of its Loans and each repayment on the
schedule attached to its Note, provided, however, that neither the failure to
so record nor any error in such recordation shall affect the Borrower's
obligations under such Note. The Borrower hereby authorizes the Lenders and
the Administrative Agent to extend, convert or continue Advances, effect
selections of Types of Advances and to transfer funds based on telephonic
notices made by any person or persons the Administrative Agent or any Lender
in good faith believes to be acting on behalf of the Borrower. The Borrower
agrees to deliver promptly to the Administrative Agent a written
confirmation, if such confirmation is requested by the Administrative Agent
or any Lender, of each telephonic notice signed by an individual who is
authorized so to act pursuant to the then existing Money Transfer
Instructions of Borrower (see "Exhibit E"). If the written confirmation
differs in any material respect from the action taken by the Administrative
Agent and the Lenders, the records of the Administrative Agent and the
Lenders shall govern absent demonstrable error.
2.14 Interest Payment Dates; Interest and Fee Basis. Interest
accrued on each Floating Rate Advance shall be payable on each Payment Date,
commencing with the first such date to occur after the date hereof, on any
date on which the Floating Rate Advance is prepaid, whether due to
acceleration or otherwise, and at maturity. Interest accrued on that portion
of the outstanding principal amount of any Floating Rate Advance converted
into a Eurodollar Advance on a day other than a Payment Date shall be payable
on the date of conversion. Interest accrued on each Eurodollar Advance shall
be payable on the last day of its applicable Interest Period, on any date on
which the Eurodollar Advance is prepaid, whether by acceleration or
otherwise, and at maturity. Interest accrued on each Eurodollar Advance
having an Interest Period longer than three months shall also be payable on
the last day of each three-month interval during such Interest Period.
Interest on Floating Rate Advances shall be calculated for actual days
elapsed on the basis of a 365- or 366-day year, as appropriate. Interest on
Eurodollar Advances and commitment fees shall be calculated for actual days
elapsed on the basis of a 360-day year. Interest shall be payable for the day
an Advance
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is made but not for the day of any payment on the amount paid if payment is
received prior to noon (local time) at the place of payment. If any payment
of principal of or interest on an Advance shall become due on a day which is
not a Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such extension of time
shall be included in computing interest in connection with such payment.
2.15 Notification of Advances. Interest Rates. Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Administrative
Agent will notify each Lender of the contents of each Aggregate Commitment
reduction notice, Borrowing Notice, Conversion/Continuation Notice, and
repayment notice received by it hereunder. The Administrative Agent will
notify each Lender of the interest rate applicable to each Eurodollar Advance
promptly upon determination of such interest rate and will give each Lender
prompt notice of each change in the Alternate Base Rate.
2.16 Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to
any such Lending Installation and the Notes shall be deemed held by each
Lender for the benefit of such Lending Installation. Each Lender may, by
written or telex notice to the Administrative Agent and the Borrower,
designate a Lending Installation through which Loans will be made by it and
for whose account Loan payments are to be made.
2.17 Non-Receipt of Funds by the Administrative Agent. Unless the
Borrower or a Lender, as the case may be, notifies the Administrative Agent
prior to the date on which it is scheduled to make payment to the
Administrative Agent of (i) in the case of a Lender, the proceeds of a Loan
or (ii) in the case of the Borrower, a payment of principal, interest or fees
to the Administrative Agent for the account of the Lenders, that it does not
intend to make such payment, the Administrative Agent may assume that such
payment has been made. The Administrative Agent may, but shall not be
obligated to, make the amount of such payment available to the intended
recipient in reliance upon such assumption. If such Lender or the Borrower,
as the case may be, has not in fact made such payment to the Administrative
Agent, the recipient of such payment shall, on demand by the Administrative
Agent, repay to the Administrative Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender,
the Federal Funds Effective Rate for such day or (ii) in the case of payment
by the Borrower, the interest rate applicable to the relevant Loan.
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1 Yield Protection. If any law or any governmental or
quasi-governmental rule, regulation, policy, guideline or directive (whether
or not having the force of law), or any interpretation thereof, or the
compliance of any Lender therewith,
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(i) subjects any Lender or any applicable Lending
Installation to any tax, duty, charge or withholding on or from
payments due from the Borrower (excluding taxation of the overall
net income of any Lender or applicable Lending Installation), or
changes the basis of taxation of payments to any Lender in respect
of its Loans or its participation in Facility L/C's or other
amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the account of,
or credit extended by, any Lender or any applicable Lending
Installation (other than reserves and assessments taken into
account in determining the interest rate applicable to Eurodollar
Advances), or
(iii) imposes any other condition the result of which is
to increase the cost to any Lender or any applicable Lending
Installation of making, funding or maintaining Loans or
participating in Letters of Credit or reduces any amount receivable
by any Lender or any applicable Lending Installation in connection
with Loans or Letters of Credit, or requires any Lender or any
applicable Lending Installation to make any payment calculated by
reference to the amount of Loans held, Letters of Credit issued or
participated in, or interest received by it, by an amount deemed
material by such Lender,
then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an
amount received which such Lender determines is attributable to making,
funding and maintaining its Loans and its commitment.
3.2 Changes in Capital Adequacy Regulations. If a Lender
determines the amount of capital required or expected to be maintained by
such Lender, any Lending Installation of such Lender or any corporation
controlling such Lender is increased as a result of a Change, then, within 15
days of demand by such Lender, the Borrower shall pay such Lender the amount
necessary to compensate for any shortfall in the rate of return on the
portion of such increased capital which such Lender determines is
attributable to this Agreement, its Loans, its obligation to make Loans
hereunder, or its issuance of or participation in Facility L/C's (after
taking into account such Lender's policies as to capital adequacy). "Change"
means (i) any change after the date of this Agreement in the Risk-Based
Capital Guidelines or (ii) any adoption of or change in any other law,
governmental or quasi-governmental rule, regulation, policy, guideline,
interpretation, or directive (whether or not having the force of law) after
the date of this Agreement which affects the amount of capital required or
expected to be maintained by any Lender or any Lending Installation or any
corporation controlling any Lender. "Risk-Based Capital Guidelines" means (i)
the risk-based capital guidelines in effect in the United States on the date
of this Agreement, including transition rules, and (ii) the corresponding
capital regulations promulgated by regulatory authorities outside the United
States implementing the July 1988 report of the Base Committee on Banking
Regulation and Supervisory Practices Entitled "International Convergence of
Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the date of this
Agreement.
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3.3 Availability of Types of Advances. If any Lender determines
that maintenance of its Eurodollar Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or
not having the force of law, or if the Required Lenders determine that (i)
deposits of a type and maturity appropriate to match fund Eurodollar Advances
are not available or (ii) the interest rate applicable to a Type of Advance
does not accurately reflect the cost of making or maintaining such Advance,
then the Administrative Agent shall suspend the availability of the affected
Type of Advance and require any Eurodollar Advances of the affected Type to
be repaid.
3.4 Funding Indemnification. If any payment of a Eurodollar
Advance occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise, or a
Eurodollar Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders, the Borrower will indemnify each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain the Eurodollar Advance.
3.5 Lender Statements; Survival of Indemnity. To the extent
reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurodollar Loans to reduce any liability of
the Borrower to such Lender under Sections 3 .1 and 3.2 or to avoid the
unavailability of a Type of Advance under Section 3.3, so long as such
designation is not disadvantageous to such Lender. Each Lender shall deliver
a written statement of such Lender to the Borrower (with a copy to the
Administrative Agent) as to the amount due, if any, under Section 3.1, 3.2 or
3.4. Such written statement shall set forth in reasonable detail the
calculations upon which such Lender determined such amount and shall be
final, conclusive and binding on the Borrower in the absence of demonstrable
error. Determination of amounts payable under such Sections in connection
with a Eurodollar Loan shall be calculated as though each Lender funded its
Eurodollar Loan through the purchase of a deposit of the type and maturity
corresponding to the deposit used as a reference in determining the
Eurodollar Rate applicable to such Loan, whether in fact that is the case or
not. Unless otherwise provided herein, the amount specified in the written
statement of any Lender shall be payable on demand after receipt by the
Borrower of such written statement. The obligations of the Borrower under
Sections 3.1, 3.2 and 3.4 shall survive payment of the Obligations and
termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT; WITHHOLDING TAX EXEMPTION
4.1 Initial Advance. The Lenders under the Long Term Agreement
became obligated to make the initial Advance and the Issuing Lender became
obligated to issue the initial Facility L/C under Article II hereof upon
submission, contemporaneously with execution of the Long Term Agreement to
NBD (predecessor in interest to First National bank of Chicago) and to the
Administrative Agent, of the following:
(i) Copies of the articles of incorporation of the Borrower,
together with all amendments, and a certificate of good standing,
both certified by the appropriate governmental officer in its
jurisdiction of incorporation.
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(ii) Copies, certified by the Secretary or Assistant Secretary
of the Borrower, of its by-laws and of its Board of Directors'
resolutions (and resolutions of other bodies, if any are deemed
necessary by counsel for any Lender) authorizing the execution of
the Loan Documents.
(iii) An incumbency certificate, executed by the Secretary
or Assistant Secretary of the Borrower, which shall identify by
name and title and bear the signature of the officers of the
Borrower authorized to sign the Loan Documents and to make
borrowings hereunder, upon which certificate the Administrative
Agent and the Lenders shall be entitled to rely until informed of
any change in writing by the Borrower.
(iv) Copies of the articles of incorporation of each
Guarantor, together with all amendments, and a certificate of good
standing, both certified by the appropriate governmental officer in
its jurisdiction of incorporation.
(v) Copies, certified by the Secretary or Assistant Secretary
of each Guarantor, of its by-laws and of its Board of Directors'
resolutions (and resolutions of other bodies, if any are deemed
necessary by counsel for any Lender) authorizing the execution of
the Guaranties.
(vi) An incumbency certificate, executed by the Secretary or
Assistant Secretary of each Guarantor, which shall identify by name
and title and bear the signature of the officers of each Guarantor
authorized to sign the Guaranties.
(vii) A certificate, signed by the treasurer of the
Borrower, stating that on the initial Borrowing Date no Default or
Unmatured Default has occurred and is continuing.
(viii) A written opinion of counsel to the Borrower,
addressed to the Lenders in substantially the form of Exhibit "B"
hereto.
(ix) Notes payable to the order of each of the Lenders.
(x) Financial statements of the Borrower, and detailed
business plans and projections for the Borrower satisfactory in
form and substance to the Lenders.
(xi) Written money transfer instructions, in substantially the
form of Exhibit "E" hereto, addressed to the Administrative Agent
and signed by an Authorized Officer, together with such other
related money transfer authorizations as the Administrative Agent
may have reasonably requested.
(xii) The Guaranties, duly executed by each of the
Guarantors.
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(xiii) Such other documents as any Lender or its counsel
may have reasonably requested.
and the following events occurred and conditions were fulfilled or waived:
(i) The Borrower paid all fees due at the Closing Date
pursuant to the Long Term Agreement, the Administrative Agent's Fee
Letter and the Arranger's Fee Letter.
(ii) Completion of the Big O Acquisition, including the
granting of all required regulatory and legal approvals, occurred
upon the terms set forth in the Acquisition Agreement.
(iii) The Private Placement contained terms and conditions
acceptable to the Lenders.
(iv) The Short Term Credit Agreement became effective as of
the Closing Date.
4.2 Each Advance. The Lenders shall not be required to make any Advance
(other than an Advance that, after giving effect thereto and to the
application of the proceeds thereof, does not increase the aggregate amount
of outstanding Advances) and the Issuing Lender shall not be required to
issue any Facility L/C, unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V
are true and correct as of such Borrowing Date except to the extent
any such representation or warranty is stated to relate solely to
an earlier date, in which case such representation or warranty
shall be true and correct on and as of such earlier date.
(iii) All legal matters incident to the making of such
Advance shall be satisfactory to the Lenders and their counsel.
Each Borrowing Notice with respect to each such Advance shall constitute
a representation and warranty by the Borrower that the conditions contained
in Sections 4.2(i) and (ii) have been satisfied.
4.3 Withholding Tax Exemption. At least five Business Days prior to the
first date on which interest or fees are payable hereunder for the account of
any Lender, each Lender that is not incorporated under the laws of the United
States of America, or a state thereof, agrees that it will deliver to each of
the Borrower and the Administrative Agent two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, certifying in either case
that such Lender is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States federal income
taxes. Each Lender which so delivers a Form 1001 or 4224
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further undertakes to deliver to each of the Borrower and the Administrative
Agent two additional copies of such form (or a successor form) on or before
the date that such form expires (currently, three successive calendar years
for Form 1001 and one calendar year for Form 4224) or becomes obsolete or
after the occurrence of any event requiring a change in the most recent forms
so delivered by it, and such amendments thereto or extensions or renewals
thereof as may be reasonably requested by the Borrower or the Administrative
Agent, in each case certifying that such Lender is entitled to receive
payments under this Agreement and the Notes without deduction or withholding
of any United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Lender from duly
completing and delivering any such form with respect to it and such Lender
advises the Borrower and the Administrative Agent that it is not capable of
receiving payments without any deduction or withholding of United States
federal income tax.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1 Corporate Existence and Standing. Each of the Borrower and its
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite authority to conduct its business in each jurisdiction in which its
business is conducted.
5.2 Authorization and Validity. The Borrower has the corporate power
and authority and legal right to execute and deliver the Loan Documents and
to perform its obligations thereunder. The execution and delivery by the
Borrower of the Loan Documents and the performance of its obligations
thereunder have been duly authorized by proper corporate proceedings, and the
Loan Documents constitute legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their terms,
except as enforceability may be limited by bankruptcy, insolvency. or similar
laws affecting the enforcement of creditors' rights generally.
5.3 No Conflict: Government Consent. Neither the execution and
delivery by the Borrower of the Loan Documents, nor the consummation of the
transactions therein contemplated, nor compliance with the provisions thereof
will violate any law, rule, regulation, order, writ, judgment, injunction,
decree or award binding on the Borrower or any of its Subsidiaries or the
Borrower's or any Subsidiary's articles of incorporation or by-laws or the
provisions of any indenture, instrument or agreement to which the Borrower or
any of its Subsidiaries is a party or is subject, or by which it, or its
Property, is bound, or conflict with or constitute a default thereunder, or
result in the creation or imposition of any Lien in, of or on the Property of
the Borrower or a Subsidiary pursuant to the terms of any such indenture,
instrument or agreement. No order, consent, approval, license, authorization,
or validation of, or filing, recording or registration with, or exemption by,
or other action in respect of any governmental or public body or authority,
or any subdivision thereof,
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is required to authorize, or is required in connection with the execution,
delivery and performance of, or the legality, validity, binding effect or
enforceability of, any of the Loan Documents.
5.4 Financial Statements. The December 31, 1997 consolidated financial
statements of the Borrower and its Subsidiaries heretofore delivered to the
Lenders were prepared in accordance with GAAP in effect on the date such
statements were prepared and fairly present the consolidated financial
condition and operations of the Borrower and its Subsidiaries at such date
and the consolidated results of operations for the period then ended.
5.5 Material Adverse Change. Since December 31, 1997, there has been
no change in the business, Property, prospects, condition (financial or
otherwise) or results of operations of the Borrower and its Subsidiaries
which could have a Material Adverse Effect, including, but not limited to, a
change in the relationship between Big O and its franchisees which could have
a Material Adverse Effect.
5.6 Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and which the failure to file would have a Material Adverse Effect, and
have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except such
taxes, if any, as are being contested in good faith and as to which any
adequate reserves have been provided in accordance with GAAP and as to which
no Lien exists. As of the date of this Agreement, the United States income
tax returns of the Borrower and its Subsidiaries have been audited by the
Internal Revenue Service through the fiscal year ended December 31, 1993. No
tax liens have been filed which could have a Material Adverse Effect and no
claims are being asserted with respect to any such taxes. To the best of
Borrower's knowledge, the charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of any taxes or other governmental
charges are adequate.
5.7 Litigation and Contingent Obligations. There is no litigation,
arbitration, governmental investigation, proceeding or inquiry pending or, to
the knowledge of any of their officers, threatened against or affecting the
Borrower or any of its Subsidiaries which could have a Material Adverse
Effect or which seeks to prevent, enjoin or delay the making of the Loans or
Advances or issuance of Facility L/C's. The Borrower has no material
contingent obligations not provided for or disclosed in the financial
statements for the most recent period for which Borrower has then delivered
financial statements to the Lenders pursuant to this Agreement.
5.8 Subsidiaries. Schedule "1" hereto contains an accurate list of all
Subsidiaries of the Borrower as of the date of the Short Term Agreement,
setting forth their respective jurisdictions of incorporation and the
percentage of their respective capital stock owned by the Borrower or other
Subsidiaries. All of the issued and outstanding shares of capital stock of
such Subsidiaries have been duly authorized and issued and are fully paid and
non-assessable.
5.9 ERISA. The Unfunded Liabilities of all Single Employer Plans do
not in the aggregate exceed $1,000,000. Neither the Borrower nor any other
member of the Controlled Group has incurred, or is reasonably expected to
incur, any withdrawal liability to Multiemployer Plans in excess of
$1,000,000 in the aggregate. Each Plan complies in all material respects with
all applicable
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requirements of law and regulations, noncompliance with which would have a
Material Adverse Effect, no Reportable Event has occurred with respect to any
Plan, neither the Borrower nor any other members of the Controlled Group has
withdrawn from any Plan or initiated steps to do so, and no steps have been
taken to reorganize or terminate any Plan, which withdrawal, reorganization
or termination would have a Material Adverse Effect.
5.10 Accuracy of Information. At the time of its delivery to the
Administrative Agent or any Lender, no information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Administrative
Agent or to any Lender in connection with the negotiation of, or compliance
with, the Loan Documents contained any material misstatement of fact or
omitted to state a material fact or any fact necessary to make the statements
contained therein not misleading.
5.11 Regulation U. Margin stock (as defined in Regulation U)
constitutes less than 25% of those assets of the Borrower and its
Subsidiaries which are subject to any limitation on sale, pledge, or other
restriction hereunder.
5.12 Material Agreements. Neither the Borrower nor any Subsidiary is a
party to any agreement or instrument or subject to any charter or other
corporate restriction which could have a Material Adverse Effect. Neither the
Borrower nor any Subsidiary is in default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions contained in
(i) any agreement to which it is a party, which default could have a Material
Adverse Effect or (ii) any agreement or instrument evidencing or governing
Indebtedness, which default could have a Material Adverse Effect.
5.13 Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof, having jurisdiction over the conduct of their businesses or
the ownership of their respective Property, the non-compliance with which
might have a Material Adverse Effect.
5.14 Ownership of Properties. Except as set forth on Schedule "2"
hereto, on the date of the Short Term Agreement, the Borrower and its
Subsidiaries had at such time good title, free of all Liens other than those
permitted by Section 6.12, to all of the Property and assets reflected in the
financial statements as owned by it.
5.15 Plan Assets: Prohibited Transactions. The Borrower is not an entity
deemed to hold "plan assets" within the meaning of 29 C.F.R. 2510.3-101 of
an employee benefit plan (as defined in Section 3 (3) of ERISA) which is
subject to Title I of ERISA or any plan (within the meaning of Section 4975
of the Code); and neither the execution of this Agreement and the making of
Loans hereunder give rise to a prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code.
5.16 Environmental Matters. Neither the Borrower nor any Subsidiary has
received any notice to the effect that its operations are not in material
compliance with any of the requirements of applicable Environmental Laws or
are the subject of any federal or state investigation evaluating
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whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which non-compliance or
remedial action could reasonably be expected to have a Material Adverse
Effect.
5.17 Investment Company Act. Neither the Borrower nor any Subsidiary
thereof is an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of
1940, as amended.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 Financial Reporting. The Borrower will maintain, for itself and
each Subsidiary, a system of accounting established and administered in
accordance with generally accepted accounting principles, and furnish to the
Lenders:
(i) Within 90 days after the close of each of its fiscal
years, a copy of the Borrower's Annual Report on Form 10-K filed
with the Securities and Exchange Commission (the "SEC") pursuant to
the Securities Exchange Act of 1934 (the "34 Act") or, if
Borrower's Form 10-K is not available, annual audited financial
statements for itself and its consolidated Subsidiaries, including
a balance sheet as of the end of such period, related profit and
loss and reconciliation of surplus statements, and a statement of
cash flows, which financial statements shall be included within an
unqualified audit report certified by independent certified public
accountants (the identity of such accountants to be acceptable to
the Lenders), which statements shall be prepared in accordance with
GAAP on a consolidated basis.
(ii) Within 45 days after the close of the first three
quarterly periods of each of its fiscal years, a copy of Borrower's
Quarterly Report on Form 10-Q filed with the SEC pursuant to the 34
Act or, if Borrower's Form 10-Q is not available, for itself and
its consolidated Subsidiaries, a consolidated unaudited balance
sheet as at the close of each such period and consolidated profit
and loss and reconciliation of surplus statements and a statement
of cash flows for the period from the begriming of such fiscal year
to the end of such quarter, all certified by its Vice President -
Treasurer, or his designee.
(iii) Together with the financial statements required
hereunder, a compliance certificate in substantially the form of
Exhibit "C" hereto signed by its Vice President - Treasurer, or his
designee, showing the calculations necessary to determine
compliance with this Agreement and stating that no Default or
Unmatured Default exists, or if any Default or Unmatured Default
exists, stating the nature and status thereof.
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(iv) If there are Unfunded Liabilities relating to any Single
Employer Plan of the Borrower at the close of any fiscal year, a
statement of the Unfunded Liabilities of such Single Employer Plan,
certified as correct by an actuary enrolled under ERISA. within 270
days after the close of such fiscal year.
(v) As soon as possible and in any event within 10 days after
the Borrower knows that any Reportable Event has occurred with
respect to any Single Employer Plan, a statement, signed by the
Vice President - Treasurer of the Borrower, or his designee,
describing said Reportable Event and the action which the Borrower
proposes to take with respect thereto.
(vi) As soon as possible and in any event within 10 days after
receipt by the Borrower or any of its Subsidiaries, a copy of (a)
any notice or claim to the effect that the Borrower or such
Subsidiary is or may be liable to any Person as a result of the
release by the Borrower or such Subsidiary or any other Person of
any toxic or hazardous waste or substance into the environment, if
such liability could have a Material Adverse Effect, and (b) any
notice alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the Borrower
or any of its Subsidiaries which could have a Material Adverse
Effect.
(vii) Promptly upon the furnishing hereof to the
shareholders of the Borrower, copies of all financial statements,
reports and proxy statements so furnished.
(viii) Promptly upon the filing thereof, copies of all
registration statements and annual, quarterly, monthly or other
regular reports or financial statements which the Borrower or any
Subsidiary files with the Securities and Exchange Commission.
(ix) Such other information (including non-financial
information) as the Administrative Agent or any Lender may from
time to time reasonably request, including but not limited to all
press releases concerning the Borrower.
6.2 Use of Proceeds. The Borrower will, and will cause each Subsidiary
to, (i) use the proceeds of the Advances for general corporate purposes, and
(ii) use the Facility L/C's for ordinary and customary business purposes. The
Borrower will not, nor will it permit any Subsidiary to, use any of the
proceeds of the Advances to purchase or carry any "margin stock" (as defined
in Regulation U).
6.3 Notice of Default. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Lenders of the occurrence
of any Default or Unmatured Default and of any other development, financial
or otherwise, which could have a Material Adverse Effect.
6.4 Conduct of Business. The Borrower will, and will cause each
Subsidiary to, carry on and conduct its business in the same general manner
and in the same general fields of enterprise as it is presently conducted and
to do all things necessary to remain duly incorporated, validly existing
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and in good standing as a domestic corporation in its jurisdiction of
incorporation and maintain all requisite authority to conduct its business in
each jurisdiction in which its business is conducted and in which the failure
to maintain such authority could have a Material Adverse Effect.
6.5 Taxes. The Borrower will, and will cause each Subsidiary to,
timely file complete and correct United States federal and applicable
foreign, state and local tax returns required by law, which the failure to so
file could have a Material Adverse Effect, and pay when due all taxes,
assessments and governmental charges and levies upon it or its income,
profits or Property, which the failure to pay could have a Material Adverse
Effect, except those which are being contested in good faith by appropriate
proceedings and with respect to which any adequate reserves have been set
aside in accordance with GAAP.
6.6 Insurance. The Borrower will, and will cause each Subsidiary to,
maintain with financially sound and reputable insurance companies insurance
on all their Property in such amounts and covering such risks as is
consistent with sound business practice, and the Borrower will furnish to any
Lender upon request full information as to the insurance carried.
6.7 Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject and
noncompliance with which could have a Material Adverse Effect.
6.8 Environmental Covenant. The Borrower will, and will cause each of
its Subsidiaries to use and operate all of its facilities and Property in
material compliance with all Environmental Laws, noncompliance with which
could have a Material Adverse Effect, keep all necessary permits, approvals,
certificates and licenses in effect and remain in material compliance
therewith, if failure to keep or comply therewith could have a Material
Adverse Effect, and handle all Hazardous Materials in material compliance
with all applicable Environmental Laws, noncompliance with which could have a
Material Adverse Effect, and provide such information and certifications as
the Administrative Agent or any Lender may reasonably request from time to
time to insure compliance with this Section 6.8.
6.9 Maintenance of Properties. The Borrower will, and will cause each
Subsidiary to, do all things necessary to maintain, preserve, protect and
keep its Property in good repair, working order and condition, normal wear
and tear excepted, and make all necessary and proper repairs, renewals and
replacements so that its business carried on in connection therewith may be
properly conducted at all times.
6.10 Inspection. The Borrower will, and will cause each Subsidiary
to, permit the Administrative Agent and the Lenders, by their respective
representatives and agents, to inspect any of the Property, corporate books
and financial records of the Borrower and each Subsidiary, to examine and
make copies of the books of accounts and other financial records of the
Borrower and each Subsidiary, and to discuss the affairs, finances and
accounts of the Borrower and each Subsidiary with, and to be advised as to
the same by, their respective officers at such reasonable times and intervals
as the Lenders may designate.
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6.11 Dividends. The Borrower will not permit any Subsidiary to
declare or pay any dividends except that any Subsidiary may declare and pay
dividends to the Borrower or to a Wholly-Owned Subsidiary.
6.12 Merger. The Borrower will not, nor will it permit any
Subsidiary to, merge or consolidate with or into any other Person, except
that a Subsidiary may merge with the Borrower or a Wholly-Owned Subsidiary,
provided that the Borrower or a Wholly-Owned Subsidiary is the surviving
corporation in any such merger or consolidation.
6.13 Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(i) The Loans.
(ii) Indebtedness existing under the Amended and Restated
Short Term Credit Agreement.
(iii) Indebtedness existing on the date of the Long Term
Agreement and described in Schedule "2" hereto.
(iv) Indebtedness incurred with respect to the Private
Placement.
(v) Indebtedness not otherwise permitted by this Section 6.13
not exceeding (as to the Borrower and all its Subsidiaries) a sum
equal to 5% of Consolidated Net Worth in aggregate principal amount
at any one time outstanding.
(vi) Contingent Obligations arising in connection with
Synthetic Leases.
(vii) Contingent Obligations entered into by Big O on
behalf of its franchisees, inclusive of those existing
Contingent Obligations of Big O listed on Schedule "4" hereto,
in an amount not to exceed $24,000,000.
6.14 Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property, to any other
Person except for (i) sales of inventory in the ordinary course of business
and sale of Big O retail stores to Big O franchisees in the ordinary course
of business, (ii) leases, sales or other dispositions of its Property that,
together will all other Property of the Borrower and its Subsidiaries
previously leased, sold or disposed of (other than inventory or retail stores
in the ordinary course of business) as permitted by this Section during the
twelve-month period ending with the month in which any such lease, sale or
other disposition occurs, do not constitute a Substantial Portion of the
Property of the Borrower and its Subsidiaries, (iii) the sale of the assets
or stock of Battery Associates, Inc. and Northern States Tire, Inc., and
(iv) leases, sales or other dispositions of its Property arising or occurring
in connection with Synthetic Leases.
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6.15 Liens. The Borrower will not, nor will it permit or suffer
any Subsidiary to, create, incur, or suffer to exist any Lien in, of or on
the property of the Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or
levies on its Property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are being
contested in good faith and by appropriate proceedings and for
which any adequate reserves in accordance with generally accepted
principles of accounting shall have been set aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's
and mechanics' liens and other similar liens arising in the
ordinary course of business which secure payment of obligations not
more than 60 days past due or which are being contested in good
faith by appropriate proceedings and for which any adequate
reserves shall have been set aside on its books.
(iii) Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance, old age
pensions, or other social security or retirement benefits, or
similar legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real Property as are of a nature
generally existing with respect to properties of a similar
character and which do not in any material way affect the
marketability of the same or interfere with the use thereof in the
business of the Borrower or its Subsidiaries.
(v) Liens on the capital stock, partnership interest, or
other evidence of ownership of any Subsidiary or such Subsidiary's
assets that secure project financing for such Subsidiary.
(vi) Purchase money Liens upon or in Property now owned or
hereafter acquired in the ordinary course of business (consistent
with the Borrower's business practices) to secure (A) the purchase
price of such Property or (B) Indebtedness incurred solely for the
purpose of financing the acquisition, construction, or improvement
of any such Property to be subject to such Liens, or Liens existing
on any such Property at the time of acquisition, or extensions,
renewals, or replacements of any of the foregoing for the same or a
lesser amount; provided that no such Lien shall extend to or cover
any Property other than the Property being acquired, constructed,
or improved and replacements, modifications, and proceeds of such
Property, and no such extension, renewal, or replacement shall
extend to or cover any Property not theretofore subject to the Lien
being extended, renewed, or replaced, and provided further that the
aggregate amount of new purchase money Liens arising in any fiscal
year of Borrower shall not exceed the principal amount of
$3,000,000.
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(vii) Liens existing on the date of the Short Term
Agreement and described in Schedule "2" hereto.
(viii) Liens arising or occurring in connection with
Synthetic Leases.
6.16 Affiliates. The Borrower will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such
Subsidiary's business and upon fair and reasonable terms no less favorable to
the Borrower or such Subsidiary than the Borrower or such Subsidiary would
obtain in a comparable arms length transaction, provided that the foregoing
shall not apply to transactions (i) between the Borrower and any Wholly-Owned
Subsidiary; or (ii) if such transactions occur in the ordinary course of
business consistent with past practices of the Borrower and/or the
Subsidiary, transactions between the Borrower or any Wholly-Owned Subsidiary
and TBC de Mexico or TBC Worldwide or transactions between Big O and any
joint venture established by Big O in the ordinary course of business.
6.17 [Reserved]
6.18 Consolidated Tangible Net Worth. The Borrower will maintain
at all times a Consolidated Tangible Net Worth of not less than the greater
of (i) $65,000,000, or (ii) Consolidated Tangible Net Worth on completion of
the Big O Acquisition, less $3,000,000, but not greater than $70,000,000,
plus 50% of the Borrower's Consolidated Net Income (without giving effect to
any losses) for each fiscal year of the Borrower ending on or after December
31, 1996. For the sole purpose of calculating the Consolidated Tangible Net
Worth covenant herein, repurchases by the Borrower of its capital stock shall
not be subtracted from the computation of Consolidated Tangible Net Worth
only to the extent of $5,000,000 in repurchases annually.
6.19 Consolidated Total Liabilities. The Borrower will not permit
the ratio of (i) Consolidated Total Liabilities to (ii) Consolidated Tangible
Net Worth to be greater than 2.25 to 1.00 at any time (measured at the end of
each fiscal quarter).
6.20 Fixed Charge Coverage Ratio. The Borrower will not permit the
Fixed Charge Coverage Ratio (measured at the end of each fiscal quarter for
the then-most recently ended four fiscal quarters) to be less than 2.25 to
1.00. Compliance shall be demonstrated on a pro forma basis until such time
as Big O's results shall have been included in Borrower's consolidated
financial statements for four fiscal quarters.
6.21 [Reserved].
6.22 Retail Stores Under Development. The Borrower shall not at
any time, on a consolidated basis, have in excess of $20,000,000 allocated to
Retail Stores Under Development on its balance sheet.
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6.23 Minimum Working Capital. Borrower will maintain working
capital (calculated as current assets less current liabilities, each
determined in accordance with GAAP) of at least $40,000,000, such amount to
be determined quarterly.
6.24 Employee Benefit Plans. The Borrower will properly conduct,
and cause each Subsidiary to properly conduct, each Single Employer Plan as
to which it may have any liability in compliance with all applicable
requirements of law and regulations, noncompliance with which could have a
Material Adverse Effect.
6.25 Other Agreements. The Borrower will not, and will not permit
any Subsidiary to, enter into any agreement containing any provision which
would be violated or breached by the performance of its obligations hereunder
or under any instrument or document delivered or to be delivered by it
hereunder or in connection with the transactions contemplated hereby.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.1 Any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries to the Lenders or the
Administrative Agent under or in connection with this Agreement, any Loan, or
any certificate or information delivered in connection with this Agreement or
any other Loan Document shall be materially false on the date as of which
made.
7.2 Nonpayment of principal of any Note when due, or nonpayment of
interest upon any Note or of any commitment fee or other obligations under
any of the Loan Documents within five days after the same becomes due.
7.3 Failure of the Borrower or any of its Subsidiaries to perform
or observe any agreement contained in Article VI and either (i) such failure
is not remedied within two Business Days after any Authorized Officer obtains
knowledge thereof or (ii) within such two day period, the Required Lenders
give the Borrower notice that such failure constitutes a Default hereunder.
7.4 The breach by the Borrower (other than a breach which
constitutes a Default under Section 7.1, 7.2 or 7.3) of any of the terms or
provisions of this Agreement which is not remedied within thirty (30) days
after the earlier to occur of (i) the date the Borrower shall have obtained
knowledge thereof and (ii) written notice thereof to the Borrower from the
Administrative Agent or any Lender.
7.5 Failure of the Borrower or any of its Subsidiaries to pay when
due any Indebtedness aggregating in excess of $2,000,000 ("Material
Indebtedness"); or the default by the Borrower or any of its Subsidiaries in
the performance of any term, provision or condition contained in any
agreement under which any such Material Indebtedness was created or is
governed, or any other event shall occur or condition exist, the effect of
which is to cause, or to permit the holder or holders of such
-▇▇-
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ to cause, such Material Indebtedness to become due
prior to its stated maturity; or any Material Indebtedness of the Borrower or
any of its Subsidiaries shall be declared to be due and payable or required
to be prepaid or repurchased (other than by a regularly scheduled payment)
prior to the stated maturity thereof; or the Borrower or any of its
Subsidiaries shall not pay, or admit in writing its inability to pay, its
debts generally as they become due.
7.6 The Borrower or any of its Subsidiaries shall (i) have an
order for relief entered with respect to it under the Federal bankruptcy laws
as now or hereafter in effect, (ii) make an assignment for the benefit of
creditors, (iii) apply for, seek, consent to, or acquiesce in, the
appointment of a receiver, custodian, trustee, examiner, liquidator or
similar official for it or any Substantial Portion of its Property, (iv)
institute any proceeding seeking an order for relief under the Federal
bankruptcy laws as now or hereafter in effect or seeking to adjudicate it a
bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief
of debtors or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, (v) take any corporate
action to authorize or effect any of the foregoing actions set forth in this
Section 7.6 or (vi) fail to contest in good faith any appointment or
proceeding described in Section 7.7.
7.7 Without the application, approval or consent of the Borrower
or any of its Subsidiaries, a receiver, trustee, examiner, liquidator or
similar official shall be appointed for the Borrower or any of its
Subsidiaries or any Substantial Portion of its Property, or a proceeding
described in Section 7.6(iv) shall be instituted against the Borrower or any
of its Subsidiaries and such appointment continues undischarged or such
proceeding continues undismissed or unstayed for a period of 30 consecutive
days.
7.8 Any court, government or governmental agency shall condemn,
seize or otherwise appropriate, or take custody or control of (each a
"Condemnation"), all or any portion of the Property of the Borrower and its
Subsidiaries which, when taken together with all other Property of the
Borrower and its Subsidiaries so condemned, seized, appropriated, or taken
custody or control of, during the twelve-month period ending with the month
in which any such Condemnation occurs, constitutes a Substantial Portion.
7.9 The Borrower or any of its Subsidiaries shall fail within 30
days to pay, bond or otherwise discharge any judgment or order for the
payment of money in excess of $3,000,000, which is not stayed on appeal or
otherwise being appropriately contested in good faith.
7.10 The Unfunded Liabilities of all Plans shall exceed in the
aggregate an amount the payment of which could reasonably be expected to have
a Material Adverse Effect or any Reportable Event shall occur in connection
with any Plan.
7.11 The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan that it has
incurred withdrawal liability to such Multiemployer Plan in an amount which,
when aggregated with all other amounts required to be paid to Multiemployer
Plans by the Borrower or any other member of the Controlled Group as
withdrawal
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liability (determined as of the date of such notification), exceeds an
amount, or requires payments exceeding an amount per annum, the payment of
which in either case could reasonably be expected to have a Material Adverse
Effect.
7.12 The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan that such
Multiemployer Plan is in reorganization or is being terminated, within the
meaning of Title IV of ERISA, if as a result of such reorganization or
termination the aggregate annual contributions of the Borrower and the other
members of the Controlled Group (taken as a whole) to all Multiemployer Plans
which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan years of each such Multiemployer Plan immediately preceding
the plan year in which the reorganization or termination occurs by an amount
the payment of which could reasonably be expected to have a Material Adverse
Effect on the business, financial condition, or results of operations of the
Borrower and its Subsidiaries taken as a whole.
7.13 The Borrower or any of its Subsidiaries shall be the subject
of any proceeding or investigation pertaining to the release by the Borrower
or any of its Subsidiaries, or any other Person of any Hazardous Material
into the environment, or any violation of Environmental Law, which, in either
case, could reasonably be expected to have a Material Adverse Effect.
7.14 Any Change in Control shall occur.
7.15 The representations and warranties set forth in "Section 5.15
Plan Assets; Prohibited Transactions" shall at any time not be true and
correct.
7.16 Any of the Guaranties shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the
invalidity or unenforceability of the Guaranties.
ARTICLE VIII
ACCELERATION WAIVERS, AMENDMENTS AND REMEDIES
8.1 Acceleration. If any Default described in Section 7.6 or 7.7
occurs with respect to the Borrower, the obligations of the Lenders to make
Loans and the obligation of the Issuing Lender to issue Facility L/C's
hereunder shall automatically terminate and the Obligations shall immediately
become due and payable without any election or action on the part of the
Administrative Agent or any Lender. If any other Default occurs, and is then
continuing, the Required Lenders (or the Administrative Agent with the
consent of the Required Lenders) may terminate or suspend the obligations of
the Lenders to make Loans and the obligation of the Issuing Lender to issue
Facility L/C's hereunder, or declare the Obligations to be due and payable,
or both, whereupon the Obligations shall become immediately due and payable,
without presentment, demand, protest or notice of any kind, all of which the
Borrower hereby expressly waives. In addition to the foregoing following the
occurrence and during the continuance of a Default, so long as any Facility
Letter of Credit has not been fully drawn and has not been canceled or
expired by its terms, upon demand by the Administrative Agent the Borrower
shall deposit in the Letter of Credit Collateral Account cash
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in an amount equal to the aggregate undrawn face amount of all outstanding
Facility Letters of Credit and all fees and other amounts due or which may
become due with respect thereto. The Borrower shall have no control over
funds in the Letter of Credit Collateral Account, which funds shall be
invested by the Administrative Agent from time to time in its discretion in
certificates of deposit of First Tennessee Bank having a maturity not
exceeding thirty days, so long as the Borrower has provided the
Administrative Agent with such documents as the Administrative Agent shall
have requested in order to perfect a security interest in such certificates
of deposit. Such funds shall be promptly applied by the Administrative Agent
to reimburse the Issuing Lender for drafts drawn from time to time under the
Facility Letters of Credit. Such funds, if any, remaining in the Letter of
Credit Collateral Account following the payment of all Obligations in full
shall, unless the Administrative Agent is otherwise directed by a court of
competent jurisdiction, be promptly paid over to the Borrower.
If, within 14 days after acceleration of the maturity of the Obligations
or termination of the obligations of the Lenders to make Loans and the
obligation of the Issuing Lender to issue Facility L/C's hereunder as a
result of any Default (other than any Default as described in Section 7.6 or
7.7 with respect to the Borrower and before any judgment or decree for the
payment of the Obligations due shall have been obtained or entered, the
Required Lenders (in their sole discretion) shall so direct, the
Administrative Agent shall, by notice to the Borrower, rescind and annul such
acceleration and/or termination.
8.2 Amendments. Subject to the provisions of this Article VIII,
the Required Lenders (or the Administrative Agent with the consent in writing
of the Required Lenders) and the Borrower may enter into agreements
supplemental hereto for the purpose of adding or modifying any provisions to
the Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder or waiving any Default hereunder; provided, however, that
no such supplemental agreement shall, without the consent of each Lender
affected thereby:
(i) Extend the final maturity of any Loan or Note or the
expiration date of any Facility L/C or the due date of any
Unreimbursed Drawing or forgive all or any portion of the principal
amount thereof, or reduce the rate or extend the time of payment of
interest or fees thereon.
(ii) Reduce the percentage specified in the definition of
Required Lenders.
(iii) Extend the Termination Date, or increase the amount
of the Commitment of any Lender hereunder, or permit the Borrower
to assign its rights under this Agreement.
(iv) Amend this Section 8.2.
(v) Release any Guarantor from its obligations under its
Guaranty.
No amendment of any provision of this Agreement relating to the
Administrative Agent shall be effective without the written consent of the
Administrative Agent. The Administrative Agent may
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waive payment of the fee required under Section 12.3.2 without obtaining the
consent of any other party to this Agreement.
8.3 Preservation of Rights. No delay or omission of the Lenders
or the Administrative Agent to exercise any right under the Loan Documents
shall impair such right or be construed to be a waiver of any Default or an
acquiescence therein, and the making of a Loan or issuance of a Facility L/C
notwithstanding the existence of a Default or the inability of the Borrower
to satisfy the conditions precedent to such Loan shall not constitute any
waiver or acquiescence. Any single or partial exercise of any such right
shall not preclude other or further exercise thereof or the exercise of any
other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid
unless in writing signed by the Lenders required pursuant to Section 8.2, and
then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and
all shall be available to the Administrative Agent and the Lenders until the
Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
9.1 Survival of Representations. All representations and warranties of
the Borrower contained in this Agreement shall survive delivery of the Notes
and the making of the Loans and issuance of Facility L/C's herein
contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement to
the contrary notwithstanding, no Lender shall be obligated to extend credit
to the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3 Taxes. Any taxes (excluding income taxes on the overall net income
of any Lender) or other similar assessments or charges made by any
governmental or revenue authority in respect of the Loan Documents shall be
paid by the Borrower, together with interest and penalties, if any.
9.4 Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any
of the provisions of the Loan Documents.
9.5 Entire Agreement. The Loan Documents and the Short Term Credit
Agreement embody the entire agreement and understanding among the Borrower,
the Administrative Agent and the Lenders and supersede all prior agreements
and understandings among the Borrower, the Administrative Agent and the
Lenders relating to the subject matter thereof
9.6 Several Obligations: Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or administrative agent of any other (except to the
extent to which the Administrative Agent is authorized to act as such). The
failure of any Lender to perform any of its obligations hereunder shall not
relieve any other Lender from any of its obligations hereunder. This
Agreement shall not be construed so as to confer
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any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns.
9.7 Expenses: Indemnification. The Borrower previously reimbursed the
Administrative Agent for any costs, and out-of-pocket expenses (including
outside attorneys' fees and time charges of attorneys for the Administrative
Agent, which attorneys may be employees of the Administrative Agent) paid or
incurred by the Administrative Agent in connection with the preparation,
negotiation, execution and delivery, of the Loan Documents. The Borrower also
agrees to reimburse the Administrative Agent and the Lenders for any costs,
internal charges and out-of-pocket expenses (including attorneys' fees and
time charges of attorneys for the Administrative Agent and the Lenders, which
attorneys may be employees of the Administrative Agent or the Lenders) paid
or incurred by the Administrative Agent or any Lender in connection with the
amendment, modification, administration, collection and enforcement of the
Loan Documents. The Borrower further agrees to indemnify the Administrative
Agent, the Syndication Agent, and each Lender, its directors, officers and
employees against all losses, claims, damages, penalties, judgments,
liabilities and expenses (including, without limitation, all expenses of
litigation or preparation therefor whether or not the Administrative Agent,
the Syndication Agent, or any Lender is a party thereto) which any of them
may pay or incur arising out of or relating to this Agreement, the other Loan
Documents, the transactions contemplated hereby or the direct or indirect
application or proposed application of the proceeds of any Loan hereunder
except to the extent that they are determined by a court of competent
jurisdiction in a final and non-appealable order to have resulted from the
gross negligence or willful misconduct of the party seeking indemnification
and except that the foregoing indemnity shall not extend to any claim
asserted by Borrower against any Lender or the Administrative Agent for
breach of its obligations as allowed under this Agreement. The obligations
of the Borrower under this Section shall survive the termination of this
Agreement.
9.8 Numbers of Documents. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to
each of the Lenders.
9.9 Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.
9.10 Severability of Provisions. Any provision in any Loan
Document that is held to be inoperative, unenforceable, or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable,
or invalid without affecting the remaining provisions in that jurisdiction or
the operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are
declared to be severable.
9.11 Nonliability of Lenders. The relationship between the
Borrower and the Lenders and the Administrative Agent shall be solely that of
borrower and lender. Neither the Administrative Agent nor any Lender shall
have any fiduciary responsibilities to the Borrower. Neither the
Administrative Agent nor any Lender undertakes any responsibility to the
Borrower to review or inform the Borrower of any matter in connection with
any phase of the Borrower's business or
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operations. The Borrower agrees that neither the Administrative Agent nor
any Lender shall have liability to the Borrower (whether sounding in tort,
contract or otherwise) for losses suffered by the Borrower in connection
with, arising out of, or in any way related to, the transactions contemplated
and the relationship established by the Loan Documents, or any act, omission
or event occurring in connection therewith, unless it is determined by a
court of competent jurisdiction in a final and non-appealable order that such
losses resulted from the gross negligence or willful misconduct of the party
from which recovery is sought. Neither the Administrative Agent nor any
Lender shall have any liability with respect to, and the Borrower hereby
waives, releases and agrees not to ▇▇▇ for, any special indirect or
consequential damages suffered by the Borrower in connection with, arising
out of, or in any way related to the Loan Documents or the transactions
contemplated thereby.
9.12 Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement
in confidence, except for disclosure (i) to its Affiliates and to other
Lenders and their respective Affiliates, (ii) to legal counsel, accountants,
and other professional advisors to that Lender or to a Transferee, (iii) to
regulatory officials, (iv) to any Person as requested pursuant to or as
required by law, regulation, or legal process, (v) to any Person in
connection with any legal proceeding to which that Lender is a party, and
(vi) permitted by Section 12.4.
9.13 Nonreliance. Each Lender hereby represents that it is not
relying on or looking to any margin stock (as defined in Regulation U of the
Board of Governors of the Federal Reserve System) for the repayment of the
Loans provided for herein.
ARTICLE X
THE ADMINISTRATIVE AGENT
10.1 Appointment; Nature of Relationship. First Tennessee Bank is
hereby appointed by the Lenders as the Administrative Agent hereunder and
under each other Loan Document, and each of the Lenders irrevocably
authorizes the Administrative Agent to act as the contractual representative
of such Lender with the rights and duties expressly set forth herein and in
the other Loan Documents. The Administrative Agent agrees to act as such
contractual representative upon the express conditions contained in this
Article X. Notwithstanding the use of the defined term "Administrative
Agent", it is expressly understood and agreed that the Administrative Agent
shall not have any fiduciary responsibilities to any Lender by reason of this
Agreement or any other Loan Document and that the Administrative Agent is
merely acting as the representative of the Lender with only those duties as
are expressly set forth in this Agreement and the other Loan Documents. In
its capacity as the Lenders' contractual representative, the Administrative
Agent and the Syndication Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders
within the meaning of Section 9-105 of the Uniform Commercial Code and (iii)
is acting as an independent contractor, the rights and duties of which are
limited to those expressly set forth in this Agreement and the other Loan
Documents. Each of the Lenders hereby agrees to assert no claim against the
Administrative Agent on any agency theory or any other theory of liability
for breach of fiduciary duty, all of which claims each Lender hereby waives.
It is expressly understood
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that as of the date of this Amended and Restated Long Term Credit Agreement,
there shall no longer be a Co-Administrative Agent hereunder or under any of
the Loan Documents.
10.2 Powers. The Administrative Agent shall have and may exercise such
powers under the Loan Documents as are specifically delegated to the
Administrative Agent by the terms of each thereof, together with such powers
as are reasonably incidental thereto. The Administrative Agent shall have no
implied duties to the Lenders, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan
Documents to be taken by the Administrative Agent.
10.3 General Immunity. Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be liable to the Borrower, the
Lenders or any Lender for any action taken or omitted to be taken by it or
them hereunder or under any other Loan Document or in connection herewith or
therewith except for its or their own gross negligence or wilful misconduct.
10.4 No Responsibility for Loans, Recitals, etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain, inquire into, or
verify (i) any statement, warranty or representation made in connection with
any Loan Document or any borrowing hereunder; (ii) the performance or
observance of any of the covenants or agreements of any obligor under any
Loan Document, including, without limitation, any agreement by an obligor to
furnish information directly to each Lender; (iii) the satisfaction of any
condition specified in Article IV, except receipt of items required to be
delivered to the Administrative Agent; (iv) the validity, enforceability,
effectiveness, sufficiency or genuineness of any Loan Document or any other
instrument or writing furnished in connection therewith; or (v) the value,
sufficiency, creation, perfection or priority of any interest in any
collateral security. The Administrative Agent shall have no duty to disclose
to the Lenders, unless requested, information that is not required to be
furnished by the Borrower to the Administrative Agent, at such time, but is
voluntarily furnished by the Borrower to the Administrative Agent (either in
their capacity as Administrative Agent or in their individual capacity).
10.5 Action on Instructions of Lenders. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting,
hereunder and under any other Loan Document in accordance with written
instructions signed by the Required Lenders, and such instructions and any
action taken or failure to act pursuant thereto shall be binding on all of
the Lenders and on all holders of Notes. The Lenders hereby acknowledge that
the Administrative Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this
Agreement or any other Loan Document unless it shall be requested in writing
to do so by the Required Lenders. The Administrative Agent shall be fully
justified in failing or refusing to take any action hereunder and under any
other Loan Document unless it shall first be indemnified to its satisfaction
by the Lenders pro rata against any and all liability, cost and expense that
it may incur by reason of taking or continuing to take any such action.
10.6 Employment of Agents and Counsel. The Administrative Agent may
execute any of its duties as Administrative Agent hereunder and under any
other Loan Document by or through employees, agents, and attorneys-in-fact
and shall not be answerable to the Lenders, except as to
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money or securities received by it or its authorized agents, for the default
or misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care. The Administrative Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and
its duties hereunder and under any other Loan Document.
10.7 Reliance on Documents Counsel. The Administrative Agent shall be
entitled to rely upon any Note, notice, consent, certificate, affidavit,
letter, telegram, statement, paper or document believed by it to be genuine
and correct and to have been signed or sent by the proper person or persons,
and, in respect to legal matters, upon the opinion of counsel selected by the
Administrative Agent, which counsel may be employees of the Administrative
Agent.
10.8 Administrative Agent's Reimbursement and Indemnification. The
Lenders agree to reimburse and indemnify the Administrative Agent ratably in
proportion to their respective Commitments (or, if the Commitments have been
terminated, in proportion to their Commitments immediately prior to such
termination) (i) for any amounts hot reimbursed by the Borrower for which the
Administrative Agent is entitled to reimbursement by the Borrower under the
Loan Documents, (ii) for any other reasonable expenses incurred by the
Administrative Agent on behalf of the Lenders, in connection with the
preparation, execution, delivery, administration and enforcement of the Loan
Documents, and (iii) for any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind and nature whatsoever which may be imposed on, incurred by or asserted
against the Administrative Agent in any way relating to or arising out of the
Loan Documents or any other document delivered in connection therewith or the
transactions contemplated thereby, or the enforcement of any of the terms
thereof or of any such other documents, provided that no Lender shall be
liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of the Administrative Agent. The
obligations of the Lenders under this Section 10.8 shall survive payment of
the Obligations and termination of this Agreement.
10.9 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Unmatured
Default hereunder unless the Administrative Agent has received written notice
from a Lender or the Borrower referring to this Agreement describing such
Default or Unmatured 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 prompt notice thereof to the Lenders.
10.10 Rights as a Lender. In the event the Administrative Agent is a
Lender, the Administrative Agent shall have the same rights and powers
hereunder and under any other Loan Document as any Lender and may exercise
the same as though it were not the Administrative Agent, and the term
"Lender" or "Lenders" shall, at any time when the Administrative Agent is a
Lender, unless the context otherwise indicates, include the Administrative
Agent in its individual capacity. The Administrative Agent may accept
deposits from, lend money to, and generally engage in any kind of trust,
debt, equity or other transaction, in addition to those contemplated by this
Agreement or any other Loan Document, with the Borrower or any of its
Subsidiaries in which the Borrower or such Subsidiary is not restricted
hereby from engaging with any other Person.
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10.11 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on the financial statements prepared by the Borrower and
such other documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement and the other
Loan Documents. Each Lender also acknowledges that it will, independently
and without reliance upon the Administrative Agent or any other Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking
action under this Agreement and the other Loan Documents.
10.12 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrower, or be removed by the Required Lenders, such resignation or removal
to be effective upon the appointment of a successor Administrative Agent or,
if no successor Administrative Agent has been appointed, forty-five days
after the retiring or removed Administrative Agent gives notice of its
intention to resign or is removed. Upon any such resignation or removal the
Required Lenders shall have the right to appoint, on behalf of the Borrower
and the Lenders and with the consent of the Borrower (which shall not be
unreasonably withheld), a successor Administrative Agent. If the
Administrative Agent has resigned or been removed and no successor
Administrative Agent has been appointed, the Lenders may perform all the
duties of the Administrative Agent hereunder and the Borrower shall make all
payments in respect of the Obligations to the applicable Lender and for all
other purposes shall deal directly with the Lenders. No successor
Administrative Agent shall be deemed to be appointed hereunder until such
successor Administrative Agent has accepted the appointment. Any such
successor Administrative Agent shall be a commercial bank having capital and
retained earnings of at least $50,000,000. Upon the acceptance of any
appointment as Administrative Agent hereunder by a successor Administrative
Agent, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the
resigning Administrative Agent. Upon the effectiveness of the resignation of
the Administrative Agent, the resigning Administrative Agent shall be
discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation or removal of an
Administrative Agent, the provisions of this Article X shall continue in
effect for the benefit of such Administrative Agent in respect of any actions
taken or omitted to be taken by it while it was acting as the Administrative
Agent hereunder and under the other Loan Documents.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1 Setoff. In addition to, and without limitation of, any rights of
the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender
to or for the credit or account of the Borrower may be offset and applied
toward the payment of the Obligations owing to such Lender, whether or not
the Obligations, or any part hereof, shall then be due.
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11.2 Ratable Payments. If any Lender, whether by setoff or otherwise,
has payment made to it upon its Loans or its Percentage of Unreimbursed
Drawings (other than payments received pursuant to Section 3.1, 3.2 or 3.4)
in a greater proportion than that received by any other Lender, such Lender
agrees, promptly upon demand, to purchase a portion of the Loans or
Unreimbursed Drawings, as the case may be, held by the other Lenders so that
after such purchase each Lender will hold its ratable proportion of Loans and
Unreimbursed Drawings. If any Lender, whether in connection with setoff or
amounts which might be subject to setoff or otherwise, receives collateral or
other protection for its Obligations or such amounts which may be subject to
setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral
ratably in proportion to their Loans. In case any such payment is disturbed
by legal process, or otherwise, appropriate further adjustments shall be
made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and
the Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under
the Loan Documents and (ii) any assignment by any Lender must be made in
compliance with Section 12.3. Notwithstanding clause (ii) of this Section,
any Lender may at any time, without the consent of the Borrower or the
Administrative Agent, assign all or any portion of its rights under this
Agreement and its Notes to a Federal Reserve Bank; provided, however, that no
such assignment to a Federal Reserve Bank shall release the transferor Lender
from its obligations hereunder. The Administrative Agent may treat the payee
of any Note as the owner thereof for all purposes hereof unless and until
such payee complies with Section 12.3 in the case of an assignment thereof
or, in the case of any other transfer, a written notice of the transfer is
filed with the Administrative Agent. Any assignee or transferee of a Note
agrees by acceptance thereof to be bound by all the terms and provisions of
the Loan Documents. Any request, authority or consent of any Person, who at
the time of making such request or giving such authority or consent is the
holder of any Note, shall be conclusive and binding on any subsequent holder,
transferee or assignee of such Note or of any Note or Notes issued in
exchange therefor.
12.2 Participations.
12.2.1 Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time sell to one or more banks or other entities ("Participants")
participating interests in any Loan owing to such Lender, any Note held
by such Lender, any Commitment, or any L/C Participation Amount of such
Lender or any other interest of such Lender under the Loan Documents.
In the event of any such sale by a Lender of participating interests to
a Participant, such Lender's obligations under the Loan Documents shall
remain unchanged, such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations, such
Lender shall remain the holder of any such Note for all purposes under
the Loan Documents, all amounts payable by the Borrower under this
Agreement shall be determined as if such Lender had not sold such
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participating interests, and the Borrower and the Administrative Agent
shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under the Loan
Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right
to approve, without the consent of any Participant, any amendment,
modification or waiver of any provision of the Loan Documents other than
any amendment, modification or waiver with respect to any Loan,
Commitment, or Facility L/C in which such Participant has an interest
which forgives principal, interest or fees or reduces the interest rate
or fees payable with respect to any such Loan, Commitment, or Facility
L/C postpones any date fixed for any regularly-scheduled payment of
principal of, or interest or fees on, any such Loan, Commitment, or
Facility L/C releases any guarantor of any such Loan or releases any
substantial portion of collateral, if any, securing any such Loan or
Facility L/C.
12.2.3 Benefit of Setoff. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of
setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.2 as if
each Participant were a Lender.
12.3 Assignments.
12.3.1 Permitted Assignments. Any Lender may, in the ordinary
course of its business and in accordance with applicable law, at any
time assign to one or more banks or other entities ("Purchasers") all or
any part of its rights and obligations under the Loan Documents. Such
assignment shall be substantially in the form of Exhibit "D" hereto or
in such other form as may be agreed to by the parties thereto. The
consent of the Borrower and the Administrative Agent shall be required
prior to an assignment becoming effective with respect to a Purchaser
which is not a Lender or an Affiliate thereof; provided, however, that
if a Default has occurred and is continuing, the consent of the Borrower
shall not be required. Such consent shall not be unreasonably withheld
or delayed. Each such assignment shall be in an amount not less than
the lesser of (i) $5,000,000 or (ii) the remaining amount of the
assigning Lender's Commitment (calculated as at the date of such
assignment).
12.3.2 Effect; Effective Date. Upon (i) delivery to the
Administrative Agent of a notice of assignment, substantially in the
form attached as Exhibit "I" to Exhibit "D" hereto (a "Notice of
Assignment"), together with any consents required by Section 12.3.1,
(ii) payment of a $3,000 fee to the Administrative Agent for processing
such assignment, and (iii) notice of such assignment delivered to the
Lenders by the transferring Lender, such assignment shall become
effective on the effective date specified in such Notice of
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Assignment. The Notice of Assignment shall contain a representation by
the Purchaser to the effect that none of the consideration used to make
the purchase of the Commitment and Loans under the applicable assignment
agreement are "plan assets" as defined under ERISA and that the rights
and interests of the Purchaser in and under the Loan Documents will not
be "plan assets" under ERISA. On and after the effective date of such
assignment, such Purchaser shall for all purposes be a Lender party to
this Agreement and any other Loan Document executed by the Lenders and
shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto,
and no further consent or action by the Borrower, the Lenders or the
Administrative Agent shall be required to release the transferor Lender
with respect to the percentage of the Aggregate Commitment, Loans, and
L/C Participation Amounts assigned to such Purchaser. Upon the
consummation of any assignment to a Purchaser pursuant to this Section
12.3.2, the transferor Lender, the Administrative Agent and the Borrower
shall make appropriate arrangements so that replacement Notes are issued
to such transferor Lender and new Notes or, as appropriate, replacement
Notes, are issued to such Purchaser, in each case in principal amounts
reflecting their Commitment, as adjusted pursuant to such assignment.
12.4 Dissemination of Information. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Person
acquiring an interest in the Loan Documents by operation of law (each a
"Transferee") and any prospective Transferee any and all information in such
Lender's possession concerning the creditworthiness of the Borrower and its
Subsidiaries, provided that each Transferee and prospective Transferee agrees
to be bound by Section 9.12 of this Agreement.
12.5 Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the
transferor Lender shall cause such Transferee, concurrently with the
effectiveness of such transfer, to comply with the provisions of Section 4.3.
ARTICLE XIII
NOTICES
13.1 Notices. Except as otherwise permitted by Section 2.13 with
respect to borrowing notices, all notices, requests and other communications
to any party hereunder shall be in writing (including bank wire, facsimile
transmission or similar writing) and shall be given to such party: (x) in the
case of the Borrower or the Administrative Agent, at its address or facsimile
number set forth on the signature pages hereof, (y) in the case of any
Lender, at its address or facsimile number set forth below its signature
hereto or (z) in the case of any party, such other address or facsimile
number as such party may hereafter specify for the purpose by notice to the
Administrative Agent and the Borrower. Each such notice, request or other
communication shall be effective (i) if given by facsimile transmission, when
transmitted to the facsimile number specified in this Section and
confirmation of receipt is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage
prepaid, addressed as aforesaid or (iii) if given by any
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other means, when delivered at the address specified in this Section;
provided that notices to the Administrative Agent under Article II shall not
be effective until received.
13.2 Change of Address. The Borrower, the Administrative Agent and
any Lender may each change the address for service of notice upon it by a
notice in writing to the other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Administrative Agent and the Lenders and each party has notified the
Administrative Agent by telex or telephone, that it has taken such action.
ARTICLE XV
CHOICE OF LAW, CONSENT TO JURISDICTION, WAIVER OF JURY TRIAL
15.1 Choice of Law. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE
WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
TENNESSEE, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
15.2 Consent to Jurisdiction. THE BORROWER HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR TENNESSEE
STATE COURT SITTING IN TENNESSEE IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW
OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER TO
BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE
ADMINISTRATIVE AGENT OR ANY LENDER OR ANY AFFILIATE OF THE ADMINISTRATIVE
AGENT OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY
ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL BE
BROUGHT ONLY IN A COURT IN TENNESSEE.
15.3 Waiver of Jury Trial. THE BORROWER, THE ADMINISTRATIVE AGENT AND
EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
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INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
IN WITNESS WHEREOF, the Borrower, the Lenders, the Administrative Agent
and the Syndication Agent have executed this Agreement as of the date first
above written.
TBC CORPORATION
Borrower
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇,
Executive Vice President and
Treasurer
TBC Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Executive Vice President and
Treasurer
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
Commitments
$9,000,000 FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
Individually and as Administrative Agent
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
National Department
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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$13,500,000 THE CHASE MANHATTAN BANK
Individually and as Syndication Agent and
Sole Book Manager
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, Vice President
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, (▇-▇)
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇,
Vice President
Telecopier: (▇▇▇)▇▇▇-▇▇▇▇
$7,500,000 SUNTRUST BANK, NASHVILLE, N.A.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, Vice President
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Vice President
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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EXHIBIT "A"
AMENDED AND RESTATED NOTE
LONG TERM
REVOLVING NOTE
$ November 9, 1998
This Amended and Restated Long Term Revolving Note (the "Note") is an
amendment and restatement of that certain Long Term Revolving Note of the
undersigned payable to the Lender in the original principal amount of Nine
Million Dollars ($ ) dated September 25, 1996.
TBC Corporation, a Delaware corporation (the "Borrower"), promises to
pay to the order of First Tennessee Bank National Association (the "Lender")
the lesser of the principal sum of Nine Million Dollars ($ ) or the
aggregate unpaid principal amount of all Loans made by the Lender to the
Borrower pursuant to Article II of the Agreement (as hereinafter defined), in
immediately available funds at the main office of First Tennessee Bank
National Association in Memphis, Tennessee, as Administrative Agent, together
with interest on the unpaid principal amount hereof at the rates and on the
dates set forth in the Agreement. The Borrower shall pay the principal of
and accrued and unpaid interest on the Loans in full on the Termination Date.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual
practice, the date and amount of each Loan and the date and amount of each
principal payment hereunder.
This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Amended and Restated Long Term Credit Agreement dated as of
November 9, 1998 (which, as it may be amended or modified and in effect
from time to time, is herein called the "Agreement"), among the Borrower, the
lenders party thereto, including the Lender, and First Tennessee Bank
National Association, as Administrative Agent, to which Agreement reference
is hereby made for a statement of the terms and conditions governing this
Note, including the terms and conditions under which this Note may be prepaid
or its maturity date accelerated. Capitalized terms used herein and not
otherwise defined herein are used with the meanings attributed to them in the
Agreement.
TBC CORPORATION
By:
Print Name:
Title:
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SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF TBC CORPORATION
DATED NOVEMBER 9, 1998
Principal Maturity of Maturity Unpaid
Date Amount of Interest Principal Balance
Loan Period Amount Paid
(See Attached)
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EXHIBIT "B"
FORM OF OPINION
September 25, 1996
The Administrative Agent and the Lenders who are parties to the
Credit Agreement described below.
Gentlemen/Ladies:
We are counsel for TBC Corporation (the "Borrower"), and have
represented the Borrower, and each of its Subsidiaries in connection with
their execution and delivery of a Long Term Credit Agreement dated as of
September 25, 1996 (the "Agreement") among the Borrower, the Lenders named
therein, and First Tennessee Bank National Association as Administrative
Agent, and providing for Advances in an aggregate principal amount not
exceeding $30,000,000 at any one time outstanding. All capitalized terms
used in this opinion and not otherwise defined herein shall have the meanings
attributed to them in the Agreement.
We have examined the Borrower's, and each of its Subsidiaries' articles
of incorporation, by-laws, and resolutions, the Loan Documents, and such
other matters of fact and law which we deem necessary in order to render this
opinion. Based upon the foregoing, it is our opinion that:
l. The Borrower, and each of its Subsidiaries are corporations duly
incorporated, validly existing and in good standing under the laws of their
states of incorporation and have all requisite authority to conduct their
business in each jurisdiction in which their business is conducted.
2. The execution and delivery of the Loan Documents to which they are
a party by the Borrower, and each of its Subsidiaries and the performance by
the Borrower, and each of its Subsidiaries of its obligations thereunder have
been duly authorized by all necessary corporate action and proceedings on the
part of the Borrower, and each of its Subsidiaries and will not:
(a) require any consent of the shareholders of the Borrower or any
of its Subsidiaries;
(b) violate any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on the Borrower or any of its
Subsidiaries or its articles of incorporation or by-laws or any
indenture, instrument or agreement binding upon the Borrower or any of
its Subsidiaries; or
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(c) result in, or require, the creation or imposition of any Lien
pursuant to the provisions of any indenture, instrument or agreement
binding upon the Borrower or any of its Subsidiaries.
3. The Loan Documents have been duly executed and delivered by the
Borrower and each of its Subsidiaries, and the Guarantors, and constitute
legal, valid and binding obligations of the Borrower, and each of its
Subsidiaries, and the Guarantors, enforceable in accordance with their terms
except to the extent the enforcement thereof may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and subject also to the availability of equitable remedies if
equitable remedies are sought.
4. There is no litigation or proceeding against the Borrower or any of
its Subsidiaries which, if adversely determined, could reasonably be expected
to have a Material Adverse Effect.
5. No approval, authorization, consent, adjudication or order of any
governmental authority, which has not been obtained by the Borrower or any of
its Subsidiaries, is required to be obtained by the Borrower or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under the Agreement or in connection with the
payment by the Borrower of the Obligations.
This opinion may be relied upon by the Administrative Agent, the Co-
Agent, the Lenders and their participants, assignees and other transferees.
Very truly yours,
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EXHIBIT "C"
COMPLIANCE CERTIFICATE
To: The Lenders Parties to the
Credit Agreement Described Below
This Compliance Certificate is furnished pursuant to that certain
Amended and Restated Credit Agreement dated as of November 9, 1998 (as
amended, modified, renewed or extended from time to time, the "Agreement")
among TBC Corporation (the "Borrower"), the Lenders party thereto and First
Tennessee Bank National Association, Lender and as Administrative Agent for
the Lenders. Unless otherwise defined herein, capitalized terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ______________________ of the Borrower;
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Borrower and its Subsidiaries during the accounting
period covered by the attached financial statements,
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which
constitutes a Default or Unmatured Default during or at the end of the
accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below; and
4. Schedule I attached hereto sets forth financial data and
computations evidencing the Borrower's compliance with certain terms of the
Agreement, all of which data and computations are true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it
has existed and the action which the Borrower has taken, is taking, or
proposes to take with respect to each such condition or event:
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this _____ day of
___________________, 19____.
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SCHEDULE I TO COMPLIANCE CERTIFICATE
Compliance as of ______________, 199____ with
Provisions of Sections 6.18, 6.19 and 6.20 of
the Amended and Restated Credit Agreement
CONSOLIDATED TANGIBLE NET WORTH (Net Worth Less Intangible Assets)
Consolidated Net Worth $
Less Consolidated Intan. Assets
Plus Stock Repurchase
Consolidated Tan. Net Worth
Required
Compliance
FUNDED INDEBTEDNESS (As amended as of 7/31/97)
Consolidated Liabilities $
Plus Guarantees
Consolidated Total Liabilities
Consolidated Tangible Net Worth
Consolidated Total Liabilities to
Consolidated Tangible Net Worth
Required
Compliance
FIXED CHARGE COVERAGE RATIO
(Earnings before Interest, Taxes and Leases to Interest, Taxes & Leases)
Fixed Charge Coverage
EBITL
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Total Interest & Lease
EBITL/ITL
Required, Minimum
Compliance
MINIMUM WORKING CAPITAL
Current Assets $
Less
Current Liabilities
Working Capital
Required, Minimum
Compliance
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EXHIBIT "D"
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between
__________________ (the "Assignor") and ________________________ (the
"Assignee") is dated as of ____________, 19____. The parties hereto agree as
follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit
Agreement (which, as it may be amended, modified, renewed or extended from
time to time is herein called the "Credit Agreement") described in Item l of
Schedule l attached hereto (" Schedule l "). Capitalized terms used herein
and not otherwise defined herein shall have the meanings attributed to them
in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns
to the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, an interest in and to the Assignor's rights and obligations under
the Credit Agreement [(other than rights and obligations of the Assignor in
its capacity as Issuing Lender)] such that after giving effect to such
assignment the Assignee shall have purchased pursuant to this Assignment
Agreement the percentage interest specified in Item 3 of Schedule l of all
outstanding rights and obligations under the Credit Agreement relating to the
facilities listed in Item 3 of Schedule l and the other Loan Documents. The
aggregate Commitment (or Loans and L/C Participation Amounts, if the
applicable Commitment has been terminated) purchased by the Assignee
hereunder is set forth in Item 4 of Schedule l.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement
(the "Effective Date") shall be the later of the date specified in Item 5 of
Schedule l or two Business Days (or such shorter period agreed to by the
Administrative Agent) after a Notice of Assignment substantially in the form
of Exhibit "I" attached hereto has been delivered to the Administrative
Agent. Such Notice of Assignment must include any consents required to be
delivered to the Administrative Agent by Section 12.3.1 of the Credit
Agreement. In no event will the Effective Date occur if the payments
required to be made by the Assignee to the Assignor on the Effective Date
under Sections 4 and 5 hereof are not made on the proposed Effective Date.
The Assignor will notify the Assignee of the proposed Effective Date no later
than the Business Day prior to the proposed Effective Date. As of the
Effective Date, (i) the Assignee shall have the rights and obligations of a
Lender under the Loan Documents with respect to the rights and obligations
assigned to the Assignee hereunder and (ii) the Assignor shall relinquish its
rights and be released from its corresponding obligations under the Loan
Documents with respect to the rights and obligations assigned to the Assignee
hereunder.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the
Assignee shall. be entitled to receive from the Administrative Agent all
payments of principal, interest and
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fees with respect to the interest assigned hereby. The Assignee shall
advance funds directly to the Administrative Agent with respect to all Loans
and reimbursement payments made on or after the Effective Date with respect
to the interest assigned hereby. [In consideration for the sale and
assignment of Loans and L/C Participation Amounts hereunder, (i) the Assignee
shall pay the Assignor, on the Effective Date, an amount equal to the
principal amount of the portion of all Floating Rate Loans assigned to the
Assignee hereunder and (ii) with respect to each Eurodollar Loan made by the
Assignor and assigned to the Assignee hereunder which is outstanding on the
Effective Date, (a) on the last day of the Interest Period therefor or (b) on
such earlier date agreed to by the Assignor and the Assignee or (c) on the
date on which any such Eurodollar Loan either becomes due (by acceleration or
otherwise) or is prepaid (the date as described in the foregoing clauses (a),
(b) or (c) being hereinafter referred to as the "Payment Date"), the Assignee
shall pay the Assignor an amount equal to the principal amount of the portion
of such Eurodollar Loan assigned to the Assignee which is outstanding on the
Payment Date. If the Assignor and the Assignee agree that the Payment Date
for such Eurodollar Loan shall be the Effective Date, they shall agree to the
interest rate applicable to the portion of such Loan assigned hereunder for
the period from the Effective Date to the end of the existing Interest Period
applicable to such Eurodollar Loan (the "Agreed Interest Rate") and any
interest received by the Assignee in excess of the Agreed Interest Rate shall
be remitted to the Assignor. In the event interest for the period from the
Effective Date to but not including the Payment Date is not paid by the
Borrower with respect to any Eurodollar Loan sold by the Assignor to the
Assignee hereunder, the Assignee shall pay to the Assignor interest for such
period on the portion of such Eurodollar Loan sold by the Assignor to the
Assignee hereunder at the applicable rate provided by the Credit Agreement.
In the event a prepayment of any Eurodollar Loan which is existing on the
Payment Date and assigned by the Assignor to the Assignee hereunder occurs
after the Payment Date but before the end of the Interest Period applicable
to such Eurodollar Loan, the Assignee shall remit to the Assignor the excess
of the prepayment penalty paid with respect to the portion of such Eurodollar
Loan assigned to the Assignee hereunder over the amount which would have been
paid if such prepayment penalty was calculated based on the Agreed Interest
Rate. The Assignee will also promptly remit to the Assignor (i) any
principal payments received from the Administrative Agent with respect to
Eurodollar Loans prior to the Payment Date and (ii) any amounts of interest
on Loans and fees received from the Administrative Agent which relate to the
portion of the Loans assigned to the Assignee hereunder for periods prior to
the Effective Date, in the case of Floating Rate Loans or fees, or the
Payment Date, in the case of Eurodollar Loans, and not previously paid by the
Assignee to the Assignor.](1) In the event that either party hereto receives
any payment to which the other party hereto is entitled under this Assignment
Agreement, then the party receiving such amount shall promptly remit it to
the other party hereto.
5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the
Assignor a fee on each day on which a payment of interest, commitment fees,
or Facility L/C fees is made
(1)Each Assignor may insert its standard payment provisions in lieu of the
payment terms included in this Exhibit.
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under the Credit Agreement with respect to the amounts assigned to the
Assignee hereunder (other than a payment of interest or fees for the period
prior to the Effective Date or, in the case of Eurodollar Loans, the Payment
Date, which the Assignee is obligated to deliver to the Assignor pursuant to
Section 4 hereof). The amount of such fee shall be the difference between
(i) the interest or fee, as applicable, paid with respect to the amounts
assigned to the Assignee hereunder and (ii) the interest or fee, as
applicable, which would have been paid with respect to the amounts assigned
to the Assignee hereunder if each interest rate was ____ of 1% less than the
interest rate paid by the Borrower or if the commitment fee was ____ of 1%
less than the commitment fee paid by the Borrower or if the Facility L/C fee
was ____% of 1% less than the Facility L/C fee paid by the Borrower, as
applicable. In addition, the Assignee agrees to pay ____% of the recordation
fee required to be paid to the Administrative Agent in connection with this
Assignment Agreement.
6. REPRESENTATIONS OF THE ASSIGNOR: LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It
is understood and agreed that the assignment and assumption hereunder are
made without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor
nor any of its officers, directors, employees, agents or attorneys shall be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of
the Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of
the terms or provisions of any of the Loan Documents, (v) inspecting any of
the Property, books or records of the Borrower, (vi) the validity,
enforceability, perfection, priority, condition, value or sufficiency of any
collateral securing or purporting to secure the Loans or (vii) any mistake,
error of judgment, or action taken or omitted to be taken in connection with
the Loans or the Loan Documents.
7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement, (ii) agrees that it will,
independently and without reliance upon the Administrative Agent, the
Assignor or any other Lender and based on such documents and information at
it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Loan Documents, (iii)
appoints and authorizes the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such powers under the Loan
Documents as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto, (iv) agrees
that it will perform in accordance with their terms all of the obligations
which by the terms of the Loan Documents are required to be
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performed by it as a Lender, (v) agrees that its payment instructions and
notice instructions are as set forth in the attachment to Schedule 1, (vi)
confirms that none of the funds, monies, assets or other consideration being
used to make the purchase and assumption hereunder are "plan assets" as
defined under ERISA and that its rights, benefits and interests in and under
the Loan Documents will not be "plan assets" under ERISA, rand (vii) attaches
the forms prescribed by the Internal Revenue Service of the United States
certifying that the Assignee is entitled to receive payments under the Loan
Documents without deduction or withholding of any United States federal
income taxes].(2)
8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the
Assignor in connection with or arising in any manner from the Assignee's
non-performance of the obligations assumed under this Assignment Agreement.
9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee
shall have the right pursuant to Section 12.3.1 of the Credit Agreement to
assign the rights which are assigned to the Assignee hereunder to any entity
or person, provided that (i) any such subsequent assignment does not violate
any of the terms and conditions of the Loan Documents or any law, rule,
regulation, order, writ, judgment, injunction or decree and that any consent
required under the terms of the Loan Documents has been obtained and (ii)
unless the prior written consent of the Assignor is obtained, the Assignee is
not thereby released from its obligations to the Assignor hereunder, if any
remain unsatisfied, including, without limitation, its obligations under
Sections 4, 5 and 8 hereof
10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
Aggregate Commitment occurs between the date of this Assignment Agreement and
the Effective Date, the percentage interest specified in Item 3 of Schedule 1
shall remain the same, but the dollar amount purchased shall be recalculated
based on the reduced Aggregate Commitment.
11. ENTIRE AGREEMENT. This Assignment Agreement and the attached
Notice of Assignment embody the entire agreement and understanding between
the parties hereto and supersede all prior agreements and understandings
between the parties hereto relating to the subject matter hereof.
12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Tennessee.
13. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties
(2)to be inserted if the Assignee is not incorporated under the laws of
the United States, or a state thereof.
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hereto (until notice of a change is delivered) shall be the address set
forth in the attachment to Schedule 1.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above
written.
[NAME OF ASSIGNOR]
By:
Title:
[NAME OF ASSIGNEE]
By:
Title:
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SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement:
Amended and Restated Credit Agreement dated as of November 9, 1998 by and
among TBC Corporation, First Tennessee Bank National Association, as
Administrative Agent, and the Lenders party thereto.
2. Date of Assignment Agreement: __________________, 19____.
3. Amounts (As of Date of Item 2 above):
Loan
Facility Letter of Credit Subfacility
a. Total of Commitments
(Loans/Facility L/C's)(3) $ [$ ]*
b. Assignee's Percentage of each
Facility purchased under the
Assignment Agreement(4)* %
c. Amount of Assigned Share in
each Facility purchased under the
Assignment Agreement $ [$ ]*
4. Assignee's Aggregate (Loan Amount/
L/C Participation Amount)*
Commitment Amount
Purchased Hereunder: $
5. Proposed Effective Date:
(3)If a Commitment has been terminated, insert outstanding Loans and
Facility L/C's in place of Commitment.
(4)Percentage taken to 10 decimal places.
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Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
Title: Title:
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Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must include notice
address for the Assignor and the Assignee.
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EXHIBIT "I"
to Assignment Agreement
NOTICE
OF ASSIGNMENT
________________, 19____
To: TBC CORPORATION
Attention:
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
Attention:
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to that Amended and Restated Credit Agreement (the "Credit
Agreement") described in Item 1 of Schedule I attached hereto ("Schedule 1").
Capitalized terms used herein and not otherwise defined herein shall have
the meanings attributed to them in the Credit Agreement.
2. This Notice of Assignment (this "Notice") is given and delivered to
the Borrower and the Administrative Agent pursuant to Section 12.3.2 of the
Credit Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of __________________, 19____ (the "Assignment"),
pursuant to which, among other things, the Assignor has sold, assigned,
delegated and transferred to the Assignee, and the Assignee has purchased,
accepted and assumed from the Assignor the percentage interest specified in
Item 3 of Schedule 1 of all outstandings, rights and obligations under the
Credit Agreement relating to the facilities listed in Item 3 of Schedule 1.
The Effective Date of the Assignment shall be the later of the date specified
in Item 5 of Schedule 1 or two Business Days (or such shorter period as
agreed to by the Administrative Agent) after this Notice of Assignment and
any consents and fees required by Sections 12.3.1 and 12.3.2 of the Credit
Agreement have been delivered to the
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Administrative Agent, provided that the Effective Date shall not occur if any
condition precedent agreed to by the Assignor and the Assignee has not been
satisfied.
4. The Assignor and the Assignee hereby give to the Borrower and the
Administrative Agent notice of the assignment and delegation referred to
herein. The Assignor will confer with the Administrative Agent before the
date specified in Item 5 of Schedule 1 to determine if the Assignment
Agreement will become effective on such date pursuant to Section 3 hereof,
and will confer with the Administrative Agent to determine the Effective Date
pursuant to Section 3 hereof if it occurs thereafter. The Assignor shall
notify the Administrative Agent if the Assignment Agreement does not become
effective on any proposed Effective Date as a result of the failure to
satisfy the conditions precedent agreed to by the Assignor and the Assignee.
At the request of the Administrative Agent, the Assignor will give the
Administrative Agent written confirmation of the satisfaction of the
conditions precedent.
5. The Assignor or the Assignee shall pay to the Administrative Agent
on or before the Effective Date the processing fee of $3,000 required by
Section 12.3.2 of the Credit Agreement.
6. If Notes are outstanding on the Effective Date, the Assignor and
the Assignee request and direct that the Administrative Agent prepare and
cause the Borrower to execute and deliver new Notes or, as appropriate,
replacements notes, to the Assignor and the Assignee. The Assignor and, if
applicable, the Assignee each agree to deliver to the Administrative Agent
the original Note received by it from the Borrower upon its receipt of a new
Note in the appropriate amount.
7. The Assignee advises the Administrative Agent that notice and
payment instructions are set forth in the attachment to Schedule 1.
8. The Assignee hereby represents and warrants that none of the funds,
monies, assets or other consideration being used to make the purchase
pursuant to the Assignment are "plan assets" as defined under ERISA and that
its rights, benefits, and interests in and under the Loan Documents will not
be "plan assets" under ERISA.
9. The Assignee authorizes the Administrative Agent to act as its
administrative agent under the Loan Documents in accordance with the terms
thereof. The Assignee acknowledges that the Administrative Agent has no duty
to supply information with respect to the Borrower or the Loan Documents to
the Assignee until the Assignee becomes a party to the Credit Agreement.(5)
(5)May be eliminated if Assignee is a party to the Credit Agreement prior
to the Effective Date.
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NAME OF ASSIGNOR NAME OF ASSIGNEE
By: By:
Title: Title:
ACKNOWLEDGED AND CONSENT TO ACKNOWLEDGED AND CONSENTED TO
BY FIRST TENNESSEE BANK, BY TBC CORPORATION
NATIONAL ASSOCIATION
By: By:
Title: Title:
[Attach photocopy of Schedule 1 to Assignment]
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EXHIBIT "E"
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To: First Tennessee Bank National Association as Administrative Agent (the
"Administrative Agent") under the Credit Agreement Described Below.
Re: Amended and Restated Long Term Credit Agreement, dated November 9, 1998,
(as the same may be amended or modified, the "Credit Agreement"), among
TBC Corporation (the "Borrower"), the Lenders named therein and the
Administrative Agent. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned thereto in the Credit
Agreement.
The Administrative Agent is specifically authorized and directed to act
upon the following standing money transfer instructions with respect to the
proceeds of Advances or other extensions of credit from time to time until
receipt by the Administrative Agent of a specific written revocation of such
instructions by the Borrower, provided, however, that the Administrative
Agent may otherwise transfer funds as hereafter directed in writing by the
Borrower in accordance with Section 13.1 of the Credit Agreement or based on
any telephonic notice made in accordance with Section 2.13 of the Credit
Agreement.
Customer/Account Name: TBC Corporation
Credit Funds to: Account No.: 00-▇▇▇▇▇▇▇
Reference/Attention To: First Tennessee Bank National Association
National Department
Authorized Officer (Customer Representative)
1. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Senior Vice President Operations and Treasurer
2. ▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President and Controller
3. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Manager of Credit and Banking
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4. ▇▇▇▇▇▇ ▇▇▇▇
Manager of Credit and Collections
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
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EXHIBIT "F"
CONTINUING GUARANTY
GUARANTY: To induce First Tennessee Bank National Association, as
Administrative Agent, and the Lenders (singularly or collectively referred to
as the "Bank"), pursuant to that certain Amended and Restated Short Term
Credit Agreement dated November 9, 1998 and that Amended and Restated Long
Term Credit Agreement dated November 9, 1998, as the same may be amended or
restated from time to time hereafter, to make loans, extend or continue
credit or some other benefit, including letters of credit and foreign
exchange contracts, present or future, direct and indirect, and whether
several, joint or joint and several (referred to collectively as
"Liabilities"), to TBC Corporation, and its successors (the "Borrower"), and
because the undersigned (the "Guarantor") has determined that executing this
Guaranty is in its interest and to its financial benefit, the Guarantor
absolutely and unconditionally guaranties to the Bank, as primary obligor and
not merely as surety, that the Liabilities will be paid when due, whether by
acceleration or otherwise. The Guarantor will not only pay the Liabilities,
but will also reimburse the Bank for accrued and unpaid interest, and any
expenses, including reasonable attorneys' fees, that the Bank may pay in
collecting from the Borrower or the Guarantor, and for liquidating any
collateral.
LIMITATION: The Guarantor's obligation under this Guaranty is
UNLIMITED. Unless otherwise specified below, the Guarantor's obligation
shall be payable in U.S. Dollars.
CONTINUED RELIANCE: The Bank may continue to make loans or extend
credit to the Borrower based on this Guaranty until it receives written
notice of termination from the Guarantor. That notice shall be effective at
the opening of the Bank for business on the day after receipt of the notice.
If terminated, the Guarantor will continue to be liable to the Bank for any
Liabilities created, assumed or committed to at the time the termination
becomes effective, and all subsequent renewals, extensions, modifications and
amendments of the Liabilities.
SETOFF: Upon any Default (as defined in the Obligations), the Bank
shall have the right to setoff against Obligations:
1. All securities and other property of the Guarantor in the custody,
possession or control of the Bank (other than property held by the Bank
solely in a fiduciary capacity);
2. All property or securities declared or acknowledged to constitute
security for any past, present or future liability, direct or indirect, of
the Guarantor to the Bank;
3. All balances of deposit accounts of the Guarantor with the Bank.
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The Bank shall have the right at any time to apply its own debt or liability
to the Guarantor in whole or partial payment of this Guaranty or other
present or future liabilities, direct or indirect, without any requirement
for mutual maturity.
If the Guarantor fails to pay any amount owing under this Guaranty, the
Bank shall have all of the rights and remedies provided by law or under any
other agreement to liquidate or foreclose on and sell any collateral,
including but not limited to the rights and remedies of a secured party under
the Uniform Commercial Code. These rights and remedies shall be cumulative
and not exclusive. If the Guarantor is entitled to notice, that requirement
will be met if the Bank sends notice at least seven (7) days prior to the
date of sale, disposition or other event which requires notice. The proceeds
of any sale shall be applied first to costs, then toward payment of the
amount owing under this Guaranty. The Bank is authorized to cause all or any
part of any collateral to be transferred to or registered in its name or in
the name of any other person, firm or corporation, with or without
designation of the capacity of such nominee. For purposes of the following
paragraphs, "any collateral" shall include any collateral securing the
Liabilities.
ACTION REGARDING BORROWER: If any monies become available that the Bank
can apply to the Liabilities (other than monies made available to the Bank by
the Guarantor pursuant to this Guaranty), the Bank may apply them in any
manner it chooses, including but not limited to applying them against
liabilities which are not covered by this Guaranty. The Bank can take any
action against the Borrower, any collateral, or any other person liable for
any of the Liabilities. The Bank can release the Borrower or anyone else
from the Liabilities, either in whole or in part, or release any collateral,
and need not perfect a security interest in any collateral. The Bank does
not have to exercise any rights that it has against the Borrower or anyone
else, or make any effort to realize on any collateral or right of set-off.
If the Borrower requests more credit or any other benefit, the Bank may grant
it and the Bank may grant renewals, extensions, modifications and amendments
of the Liabilities and otherwise deal with the Borrower or any other person
as the Bank sees fit and as if this Guaranty were not in effect. The
Guarantor's obligations under this Guaranty shall not be released or affected
by (a) any act or omission of the Bank, (b) the voluntary or involuntary
liquidation, sale or other disposition of all or substantially all of the
assets of the Borrower, or any receivership, insolvency, bankruptcy,
reorganization, or other similar proceedings affecting the Borrower or any of
its assets, or (c) any change in the composition or structure of the Borrower
or the Guarantor, including a merger or consolidation with any other person
or entity.
NATURE OF GUARANTY: This Guaranty is a guaranty of payment and not of
collection. Therefore, the Bank can insist that the Guarantor pay
immediately, and the Bank is not required to attempt to collect first from
the Borrower, any collateral, or any other person liable for the Liabilities.
The obligation of the Guarantor shall be unconditional and absolute,
regardless of the unenforceability of any provision of any agreement between
the Borrower and the Bank, or the existence of any defense, setoff or
counterclaim which the Borrower may assert.
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OTHER GUARANTORS: If there is more than one Guarantor, their
obligations under this Guaranty shall be joint and several. In addition,
each Guarantor shall be jointly and severally liable with any other guarantor
of the Liabilities. If the Bank elects to enforce its rights against less
than all guarantors of the Liabilities, that election shall not release
Guarantor from its obligations under this Guaranty. The compromise or
release of any of the obligations of any of the other guarantors or the
Borrower shall not serve to waive, alter or release the Guarantor's
obligations. This Guaranty is not conditioned on anyone else executing this
or any other guaranty.
RIGHTS OF SUBROGATION: The Guarantor agrees not to enforce any rights
of subrogation, contribution or indemnification that it has against the
Borrower, any entity liable for the Liabilities, or any collateral, until the
Liabilities are fully paid, even if all Liabilities are not covered by this
Guaranty. The Guarantor further agrees that if any payments to the Bank on
the Liabilities are in whole or in part invalidated, declared to be
fraudulent or preferential, set aside or required to be repaid to a trustee,
receiver or any other party under any bankruptcy act or code, state or
federal law, common law or equitable doctrine, this Guaranty and the Bank's
interest in any collateral remain in full force and effect (or are reinstated
as the case may be) until payment in full of those amounts, which payment is
due on demand.
WAIVERS: The Guarantor waives any right it may have to receive notice
of the following matters before the Bank enforces any of its rights: (a) the
Bank's acceptance of this Guaranty, (b) any credit that the Bank extends to
the Borrower, (c) the Borrower's default, (d) any demand, (e) any action that
the Bank takes regarding the Borrower, anyone else, any collateral, or any
Liability, which it might be entitled to by law or under any other agreement.
Any waiver shall affect only the specific terms and time period stated in
the waiver. The Bank may waive or delay enforcing any of its rights without
losing them. No modification or waiver of this Guaranty shall be effective
unless it is in writing and signed by the party against whom it is being
enforced.
REPRESENTATIONS BY GUARANTOR: Each Guarantor represents: (a) that the
execution and delivery of this Guaranty and the performance of the
obligations it imposes do not violate any law, conflict with any agreement by
which it is bound, or require the consent or approval of any governmental
authority or any third party; (b) that this Guaranty is a valid and binding
agreement, enforceable according to its terms; and (c) that all balance
sheets, profit and loss statements, and other financial statements furnished
to the Bank are accurate and fairly reflect the financial condition of the
organizations and persons to which they apply on their effective dates,
including contingent liabilities of every type, which financial condition has
not changed materially and adversely since those dates. Each Guarantor,
other than a natural person, further represents: (a) that it is duly
organized, existing and in good standing pursuant to the laws under which it
is organized; and (b) that the execution and delivery of this Guaranty and
the performance of the obligations it imposes (i) are within its powers and
have been duly authorized by all necessary action of its governing body; and
(ii) do not contravene the terms of its articles of
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incorporation or organization, its by-laws, or any partnership, operating or
other agreement governing its affairs.
NOTICES: Notice from one party to another relating to this Guaranty
shall be deemed effective if made in writing (including telecommunications)
and delivered to the recipient's address, telex number or facsimile number
set forth under its name by any of the following means: (a) hand delivery,
(b) registered or certified mail, postage prepaid, with return receipt
requested, (c) first class or express mail, postage prepaid, (d) Federal
Express, Purolator Courier or like overnight courier service or (e)
facsimile, telex or other wire transmission with request for assurance of
receipt in a manner typical with respect to communications of that type.
Notice made in accordance with this section shall be deemed delivered on
receipt if delivered by hand or wire transmission, on the third business day
after mailing if mailed by first class, registered or certified mail, or on
the next business day after mailing or deposit with an overnight courier
service if delivered by express mail or overnight courier. Notwithstanding
the foregoing, notice of termination of this Guaranty shall be deemed
received only upon the receipt of actual written notice by the Bank in
accordance with the paragraph above labeled "Continued Reliance."
LAW AND JUDICIAL FORUM THAT APPLY: This agreement is governed by
Tennessee law. The Guarantor agrees that any legal action or proceeding
against it with respect to any of its obligations under this Guaranty may be
brought in any court of the State of Tennessee or of the United States of
America for the Eastern or Western District of Tennessee, as the Bank in its
sole discretion may elect. By the execution and delivery of this Guaranty,
the Guarantor submits to and accepts, with regard to any such action or
proceeding, for itself and in respect of its property, generally and
unconditionally, the jurisdiction of those courts. The Guarantor waives any
claim that the State of Tennessee is not a convenient forum or the proper
venue for any suit, action or proceeding.
MISCELLANEOUS: Subject to the express provisions of any subsequent
guaranty, Guarantor's liability under this Guaranty is independent of its
liability under any other guaranty previously or subsequently executed by the
Guarantor, as to all or any part of the Liabilities, and may be enforced for
the full amount of this Guaranty regardless of the Guarantor's liability
under any other guaranty. This Guaranty is binding on the Guarantor's heirs,
successors and assigns, and will operate to the benefit of the Bank and its
successors and assigns. The use of headings shall not limit the provisions
of this Guaranty.
WAIVER OF JURY TRIAL: The Bank and the Guarantor, after consulting or
having had the opportunity to consult with counsel, knowingly, voluntarily
and intentionally waive any right either of them may have to a trial by jury
in any litigation based upon or arising out of this Guaranty or any related
instrument or agreement, or any of the transactions contemplated by this
Guaranty, or any course of conduct, dealing, statements (whether oral or
written), or actions of either of them. Neither the Bank nor the Guarantor
shall seek to consolidate, by counterclaim or otherwise, any action in which
a jury trial has been waived with any other action in which a jury trial
cannot be or has not been waived. These provisions shall not be deemed to
have been
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modified in any respect or relinquished by either the Bank or the Guarantor
except by a written instrument executed by both of them.
Dated: November 9, 1998
GUARANTOR:
ADDRESS:
By:
Its:
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