Exhibit 4
---------
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of December 11, 1998
among
KATY INDUSTRIES, INC.,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Administrative Agent and Issuing Bank,
LA SALLE NATIONAL BANK,
as Managing Agent,
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
NATIONSBANC ▇▇▇▇▇▇▇▇▇▇ SECURITIES LLC,
as Lead Arranger and Syndication Agent
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS 1
1.1 Certain Defined Terms. 1
1.2 Other Interpretive Provisions. 24
1.3 Accounting Principles. 25
ARTICLE II. THE CREDITS 25
2.1 Amounts and Terms of Commitments. 26
2.2 Loan Accounts. 26
2.3 Procedure for Borrowing. 27
2.4 Conversion and Continuation Elections. 28
2.5 Voluntary Termination or Reduction of Commitments. 29
2.6 Optional Prepayments. 30
2.7 Mandatory Prepayments of Loans; Mandatory Commitment Reductions. 30
2.8 Repayment. 30
2.9 Interest. 30
2.10 Fees. 31
2.11 Computation of Fees and Interest. 32
2.12 Payments by the Company. 32
2.13 Payments by the Banks to the Agent. 33
2.14 Sharing of Payments, Etc. 33
2.15 Quarterly Adjustments. 34
2.16 Extension of Facility A Revolving Termination Date. 34
ARTICLE III. THE LETTERS OF CREDIT 35
3.1 The Letter of Credit Subfacilities. 35
3.2 Issuance, Amendment and Renewal of Letters of Credit. 36
3.3 Risk Participations, Drawings and Reimbursements. 38
3.4 Repayment of Participations. 40
3.5 Role of the Issuing Bank. 41
3.6 Obligations Absolute 41
3.7 Cash Collateral Pledge. 42
3.8 Letter of Credit Fees. 43
3.9 Uniform Customs and Practice. 43
3.10 Subsidiaries as Account Parties. 43
3.11 Issuing Affiliate. 46
ARTICLE IV. TAXES, YIELD PROTECTION AND ILLEGALITY 46
4.1 Taxes. 46
4.2 Illegality. 47
4.3 Increased Costs and Reduction of Return. 48
4.4 Funding Losses. 49
4.5 Inability to Determine Rates. 49
4.6 Certificates of Banks. 50
4.7 Substitution of Banks. 50
4.8 Survival. 50
ARTICLE V. CONDITIONS PRECEDENT 50
5.1 Conditions of Initial Credit Extensions. 50
5.2 Conditions of Initial Acquisition Loans. 53
5.3 Conditions to All Credit Extensions. 55
ARTICLE VI. REPRESENTATIONS AND WARRANTIES 55
6.1 Corporate Existence and Power. 56
6.2 Corporate Authorization; No Contravention. 56
6.3 Governmental Authorization. 56
6.4 Binding Effect. 56
6.5 Litigation. 57
6.6 No Default. 57
6.7 ERISA Compliance. 57
6.8 Use of Proceeds; Margin Regulations. 58
6.9 Title to Properties. 58
6.10 Taxes. 58
6.11 Financial Condition. 59
6.12 Environmental Matters. 59
6.13 Regulated Entities. 59
6.14 No Burdensome Restrictions. 59
6.15 Copyrights, Patents, Trademarks and Licenses, etc. 60
6.16 Subsidiaries. 60
6.17 Insurance. 60
6.18 Swap Obligations. 60
6.19 Full Disclosure. 61
6.20 Y2K. 61
ARTICLE VII. AFFIRMATIVE COVENANTS 61
7.1 Financial Statements. 61
7.2 Certificates; Other Information. 62
7.3 Notices. 63
7.4 Preservation of Corporate Existence, Etc. 65
7.5 Maintenance of Property. 65
7.6 Insurance. 65
7.7 Y2K. 65
7.8 Compliance with Laws. 66
7.9 Compliance with ERISA. 66
7.10 Inspection of Property and Books and Records. 66
7.11 Environmental Laws. 66
7.12 Use of Proceeds. 66
7.13 New Subsidiaries. 67
7.14 Purchase Agreement. 67
ARTICLE VIII. NEGATIVE COVENANTS 67
8.1 Limitation on Liens. 67
8.2 Disposition of Assets. 69
8.3 Consolidations and Mergers. 70
8.4 Loans and Investments. 71
8.5 Limitation on Indebtedness. 72
8.6 Transactions with Affiliates. 73
8.7 Use of Proceeds. 73
8.8 Contingent Obligations. 73
8.9 Joint Ventures. 74
8.10 Lease Obligations. 74
8.11 Restricted Payments. 74
8.12 ERISA. 75
8.13 Change in Business. 75
8.14 Accounting Changes. 75
8.15 Amendment to Purchase Documents. 75
8.16 Limitation on Negative Pledge Clauses. 75
8.17 Limitation on Restrictions on Subsidiary Dividends and Other
Distributions. 76
8.18 Minimum Net Worth. 76
8.19 Maximum Leverage Ratio. 76
8.20 Minimum Fixed Charge Coverage Ratio. 77
8.21 Quarterly Losses. 77
ARTICLE IX. EVENTS OF DEFAULT 77
9.1 Event of Default. 77
9.2 Remedies. 80
9.3 Rights Not Exclusive. 81
9.4 Certain Financial Covenant Defaults. 81
ARTICLE X. THE AGENT 81
10.1 Appointment and Authorization; "Agent". 81
10.2 Delegation of Duties. 82
10.3 Liability of Agent. 82
10.4 Reliance by Agent. 83
10.5 Notice of Default. 83
10.6 Credit Decision. 83
10.7 Indemnification of Agent. 84
10.8 Agent in Individual Capacity. 84
10.9 Successor Agent. 85
10.10 Withholding Tax. 85
10.11 Managing Agent, etc. 87
10.12 Release of Guaranty. 87
ARTICLE XI. MISCELLANEOUS 87
11.1 Amendments and Waivers. 87
11.2 Notices. 88
11.3 No Waiver; Cumulative Remedies. 89
11.4 Costs and Expenses. 89
11.5 Company Indemnification. 90
11.6 Payments Set Aside. 90
11.7 Successors and Assigns. 90
11.8 Assignments, Participations, etc. 91
11.9 Confidentiality. 92
11.10 Set-off. 93
11.11 Automatic Debits of Fees. 93
11.12 Notification of Addresses, Lending Offices, Etc. 94
11.13 Counterparts. 94
11.14 Severability. 94
11.15 No Third Parties Benefited. 94
11.16 Governing Law and Jurisdiction. 94
11.17 Waiver of Jury Trial. 95
11.18 Entire Agreement. 95
SCHEDULES
Schedule 1.1A Existing Letters of Credit
Schedule 1.1B Operations Planned for Divestiture
Schedule 2.1 Commitments
Schedule 6.5 Litigation
Schedule 6.7 ERISA
Schedule 6.11 Permitted Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.16 Subsidiaries and Minority Interests
Schedule 6.17 Insurance Matters
Schedule 8.1 Permitted Liens
Schedule 8.2 Permitted Disposition of Investments
Schedule 8.4 Permitted Investments
Schedule 8.5 Permitted Indebtedness
Schedule 8.8 Contingent Obligations
Schedule 11.2 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Notice of Borrowing
Exhibit B Notice of Conversion/Continuation
Exhibit C Compliance Certificate
Exhibit D Legal Opinion of Company's Counsel
Exhibit E Assignment and Acceptance Agreement
Exhibit F Promissory Note
Exhibit G Guaranty Agreement
CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of
December 11, 1998, among Katy Industries, Inc., a Delaware corporation (the
"Company"), the several financial institutions from time to time party to
this Agreement (collectively, the "Banks"; individually, a "Bank"), La Salle
National Bank, as managing agent, and Bank of America National Trust and
Savings Association, as letter of credit issuing bank and as administrative
agent for the Banks.
WHEREAS, the Company, Bank of America National Trust and Savings
Association, La Salle National Bank and certain other financial institutions
entered into a Credit Agreement dated as of December 12, 1997, as amended by
the First Amendment to Credit Agreement dated as of September 11, 1998 (the
"Existing Credit Agreement");
WHEREAS, the Banks have agreed to make available to the Company
revolving credit facilities with letter of credit subfacilities upon the
terms and conditions set forth in this Agreement;
WHEREAS, to give effect to the foregoing, the Company, the
Banks, and the Agent desire to amend and restate the Existing Credit
Agreement;
NOW, THEREFORE, in consideration of the mutual agreements,
provisions and covenants contained herein, the parties hereby amend and
restate the Existing Credit Agreement in its entirety as follows:
ARTICLE I.
DEFINITIONS
1.1 Certain Defined Terms.
The following terms have the following meanings:
"Acquired Company" means CII Acquisition, L.L.C., a Delaware
limited liability company.
"Acquisition" means any transaction or series of related
transactions for the purpose of or resulting, directly or indirectly, in (a)
the acquisition of all or substantially all of the assets of a Person, or of
any business or division of a Person, (b) the acquisition of in excess of
50% of the capital stock, partnership interests, membership interests or
equity of any Person, or otherwise causing any Person to become a
Subsidiary, or (c) a merger or consolidation or any other combination with
another Person (other than a Person that is a Restricted Subsidiary)
provided that the Company or the Restricted Subsidiary is the surviving
entity.
"Acquisition Loan" means any Facility B Loan that causes the
Effective Amount of all Facility B Loans to exceed of $30,000,000.00.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. A Person shall be deemed to control
another Person if the controlling Person possesses, directly or indirectly,
the power to direct or cause the direction of the management and policies of
the other Person, whether through the ownership of voting securities,
membership interests, by contract, or otherwise.
"Agent" means Bank of America in its capacity as administrative
agent for the Banks hereunder, and any successor administrative agent
arising under Section 10.9.
"Agent-Related Persons" means Bank of America and any successor
administrative agent arising under Section 10.9 and any successor letter of
credit issuing bank hereunder, together with their respective Affiliates
(including, in the case of Bank of America, ▇▇▇▇▇▇▇▇▇▇), and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agent's Payment Office" means the address for payments set
forth on Schedule 11.2 or such other address as the Agent may from time to
time specify.
"Agreement" means this Amended and Restated Credit Agreement.
"Applicable Margin" means with respect to any Base Rate Loan or
Offshore Rate Loan under the Facility A Commitment or the Facility B
Commitment the per annum rates set forth below opposite the Pricing Level
calculated for the periods described below.
Pricing Pricing Ratio Facility A Facility B
Level at End of
Fiscal Quarter Applicable Margin Applicable Margin
------- -------------- ------------------ -------------------
Offshore Base Rate Offshore Base Rate
Rate Loans Loans Rate Loans Loans
I Less Than
1.00 to 1.00 0.775% 0.000% 0.750% 0.000%
II Greater than
or equal to
1.00 to 1.00
but less
than
1.75 to 1.00 0.975% 0.000% 0.950% 0.000%
III Greater than
or equal to
1.75 to 1.00
but less
than 2.25 to
1.00 1.150% 0.000% 1.125% 0.000%
IV. Greater than
or equal to
2.25 to 1.00
but less
than 2.75 to
1.00 1.350% 0.000% 1.325% 0.000%
V. Greater than
or equal to
2.75 to 1.00
but less
than 3.25 to
1.00 1.575% 0.375% 1.550% 0.375%
VI. Greater than
or equal to
3.25 to 1.00 1.900% 0.750% 1.875% 0.750%
Where,
"Pricing Level" means, for each Pricing Period, the
pricing level set forth opposite the Pricing Ratio set forth in
the Compliance Certificate most recently delivered to the Agent
pursuant to Section 7.2.
"Pricing Level Change Date" means the date three
Business Days after the delivery to the Agent of the financial
reports and Compliance Certificate delivered pursuant to
Sections 7.1 and 7.2 for the fiscal quarter ending March 31,
1999, and three days after delivery to the Agent of such
financial reports and Compliance Certificate for each fiscal
quarter thereafter.
"Pricing Period" means each period commencing on
each Pricing Level Change Date and ending the day prior to the
next Pricing Level Change Date.
From the Closing Date until the first Pricing Level Change Date,
the Applicable Margin for any Offshore Rate Loan or Base Rate Loan shall
correspond to the rates per annum set forth above opposite Pricing Level V,
unless the Company's Pricing Ratio, as reflected in the Compliance
Certificate delivered pursuant to Section 7.2 for the fiscal year ending
December 31, 1998, dictates that Pricing Level VI should apply, in which
case Pricing Level VI shall apply from the date three Business Days after
such delivery until the first Pricing Level Change Date; provided, however,
if the Contico Acquisition has not occurred on or before February 26, 1999,
then the Applicable Margin from such date until the first Pricing Level
Change Date shall be based upon the Pricing Ratio reflected in the most
recent Compliance Certificate delivered pursuant to Section 7.2 or pursuant
to Section 7.2 of the Existing Credit Agreement (any change therein taking
effect 3 Business Days after delivery of a more recent Compliance
Certificate). The Applicable Margin shall be adjusted automatically as to
all Loans then outstanding (without regard to the timing of Interest
Periods) on each Pricing Level Change Date to correspond with the applicable
Pricing Level. If the Company fails to deliver such financial reports and
certificates to the Agent for any fiscal quarter by the date required
hereunder, then the Applicable Margin for all Loans beginning three Business
Days after such date shall, until three Business Days after delivery of such
financial reports and certificates, be the next higher Applicable Margin as
set forth in the chart above immediately below the previously effective
Applicable Margin; thus, if the Applicable Margin with respect to Facility B
had previously been 0.750% for Offshore Rate Loans, a failure to deliver
quarterly financials on a timely basis would cause the Applicable Margin
with respect to Facility B to be .950% until three Business Days after such
delivery.
"Assignee" has the meaning specified in subsection 11.8(a).
"Attorney Costs" means and includes all fees and disbursements
of any law firm or other external counsel, the allocated cost of
nonduplicative internal legal services and all disbursements of internal
counsel.
"Bank" has the meaning specified in the introductory clause
hereto. References to the "Banks" shall include Bank of America, including
in its capacity as Issuing Bank; for purposes of clarification only, to the
extent that Bank of America may have any rights or obligations in addition
to those of the Banks due to its status as Issuing Bank, its status as such
will be specifically referenced.
"Bankruptcy Code" means the Federal Bankruptcy Reform Act of
1978 (11 U.S.C. 101, et seq.).
"Base Rate" means, for any day, the higher of: (a) 0.50% per
annum above the latest Federal Funds Rate, and (b) the rate of interest in
effect for such day as publicly announced from time to time by Bank of
America in San Francisco, California, as its "reference rate," or, if Bank
of America no longer announces a "reference rate," its "prime rate" or other
successor rate as Bank of America may notify the Company. (The "reference
rate" or such successor rate is a rate set by Bank of America based upon
various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference
point for pricing some loans, which may be priced at, above, or below such
announced rate.) Any change in the reference rate announced by Bank of
America shall take effect at the opening of business on the day specified in
the public announcement of such change.
"Base Rate Loan" means a Revolving Loan, or an L/C Advance, that
bears interest based on the Base Rate.
"Bank of America" means Bank of America National Trust and
Savings Association., a national banking association, and its successors.
"Borrowing" means a borrowing hereunder consisting of Revolving
Loans of the same Type made to the Company on the same day by the Banks
under Article II, and, other than in the case of Base Rate Loans, having the
same Interest Period.
"Borrowing Date" means any date on which a Borrowing occurs
under Section 2.3.
"Business Day" means any day other than a Saturday, Sunday or
other day on which commercial banks in New York City, Dallas, Texas, or San
Francisco are authorized or required by law to close and, if the applicable
Business Day relates to any Offshore Rate Loan, means such a day on which
dealings are carried on in the applicable offshore dollar interbank market.
"Capital Adequacy Regulation" means any guideline, request or
directive of any central bank or other Governmental Authority, or any other
law, rule or regulation, whether or not having the force of law, in each
case, regarding capital adequacy of any bank or of any corporation
controlling a bank.
"Capital Lease" means any leasing or similar arrangement which,
in accordance with GAAP, is classified as a capital lease.
"Cash Collateralize" means to pledge and deposit with or deliver
to the Agent, for the benefit of the Agent, the Issuing Bank and the Banks,
as collateral for the L/C Obligations, cash or deposit account balances
pursuant to documentation in form and substance satisfactory to the Agent
and the Issuing Bank (which documents are hereby consented to by the Banks).
Derivatives of such term shall have corresponding meaning. The Company
hereby grants the Agent, for the benefit of the Agent, the Issuing Bank and
the Banks, a security interest in all such cash and deposit account
balances. Cash collateral shall be maintained in blocked, interest
bearing deposit accounts at Bank of America.
"Change of Control" means, with respect to the Company, an event
or circumstance that results in any Person or group of related Persons other
than the Permitted Owners (as defined below) having beneficial ownership of,
or the right to control, by proxy or otherwise, (i) more than 50% of the
shares of common stock of the Company, or (ii) capital stock of the Company
having voting power to vote for and elect a majority of the members of the
board of directors of the Company. "Permitted Owners" shall mean any of the
following: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., his wife, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, their
immediate family members, descendants and beneficiaries under the following
trusts and subtrusts: (i) The ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Trust U/A Date 7/1/57
F/B/O ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. and his descendants, (ii) The ▇▇▇▇▇▇▇ ▇. and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Trust U/A Dated 5/1/58 F/B/O ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., and
his descendants, (iii) the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Trust U/A Dated 1/20/61
F/B/O ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., (iv) the ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Trust U/A Dated
7/12/62 F/B/O ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., (v) the subtrusts under the ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇ Trust U/A Dated 12/15/78 F/B/O the descendants of ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇., (vi) the subtrusts under the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., Trust #1
U/A Dated 12/30/76 F/B/O the descendants of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. and
(vii) the subtrusts under the ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. Trust #2 U/A Dated
12/30/76 F/B/O the descendants of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇. In addition, CRL,
Inc. and its wholly owned subsidiaries shall be Permitted Owners as long as
all capital stock of CRL, Inc. is wholly-owned by other Permitted Owners.
"Closing Date" means the date on which all conditions precedent
set forth in Section 5.1 are satisfied or waived by all Banks (or, in the
case of subsection 5.1(e), waived by the Person entitled to receive such
payment).
"Code" means the Internal Revenue Code of 1986, and regulations
promulgated thereunder.
"Commercial L/C Commitment" means the commitment of the Issuing
Bank to Issue, and the commitment of the Banks severally to participate in,
Commercial Letters of Credit from time to time Issued or outstanding under
Article III, in an aggregate amount not to exceed on any date the amount of
$30,000,000, as the same shall be reduced as a result of a reduction in the
Commercial L/C Commitment pursuant to Section 2.5; provided that the
Commercial L/C Commitment is a part of the combined Facility A Commitments,
rather than a separate, independent commitment.
"Commercial Letter of Credit" means a Letter of Credit
supporting the obligation to pay the purchase price of goods sold to the
Company or a Restricted Subsidiary.
"Commitment", as to each Bank, means either the Facility A
Commitment or the Facility B Commitment, as applicable.
"Commitments" , as to each Bank, means the sum of the Facility A
Commitment and the Facility B Commitment.
"Company" means Katy Industries, Inc., a Delaware corporation.
"Compliance Certificate" means a certificate substantially in
the form of Exhibit C.
"Consolidated Interest Expense" means, for any period, for the
Company and its Restricted Subsidiaries on a consolidated basis and
determined in accordance with GAAP, (a) gross interest expense for the
period (including that portion of Capital Leases attributable to interest),
plus (b) any payments made under interest rate Swap Contracts to the extent
not included in gross interest expense, less (c) the sum of any payments
received under interest rate Swap Contracts.
"Contico" means Contico International, Inc., a Missouri
corporation.
"Contico Acquisition" means the contribution of the Contico
Assets to the Acquired Company and the acquisition by the Company of 100% of
the common units of the Acquired Company as contemplated by the Purchase
Agreement.
"Contico Assets" means substantially all of the assets and
business constituting the janitorial, consumer products, and industrial
packaging businesses of Contico as conducted before the Contico Acquisition
that are being contributed to the Acquired Company pursuant to the
Contribution Agreement as defined in the Purchase Agreement.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease, dividend,
letter of credit or other obligation (the "primary obligations") of another
Person (the "primary obligor"), including any obligation of that Person (i)
to purchase, repurchase or otherwise acquire such primary obligations or any
security therefor, (ii) to advance or provide funds for the payment or
discharge of any such primary obligation, or to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth
or solvency or any balance sheet item, level of income or financial
condition of the primary obligor, (iii) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation, or (iv) otherwise to assure or hold harmless the holder
of any such primary obligation against loss in respect thereof (each, a
"Guaranty Obligation");(b) with respect to any Surety Instrument
(other) than any Letter of Credit) issued for the account of that Person or as
to which that Person is otherwise liable for reimbursement of drawings or
payments; (c) to purchase any materials, supplies or other property from, or
to obtain the services of, another Person if the relevant contract or other
related document or obligation requires that payment for such materials,
supplies or other property, or for such services, shall be made regardless
of whether delivery of such materials, supplies or other property is ever
made or tendered, or such services are ever performed or tendered, or (d) in
respect of any Swap Contract. The amount of any Contingent Obligation shall,
in the case of Guaranty Obligations, be deemed equal to the stated or
determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made or, if not stated or if indeterminable, the
maximum reasonably anticipated liability in respect thereof, and in the case
of other Contingent Obligations other than in respect of Swap Contracts,
shall be equal to the maximum reasonably anticipated liability in respect
thereof and, in the case of Contingent Obligations in respect of Swap
Contracts, shall be equal to the Swap Termination Value.
"Contractual Obligation" means, as to any Person, any provision
of any security issued by such Person or of any agreement, undertaking,
contract, indenture, mortgage, deed of trust or other instrument, document
or agreement to which such Person is a party or by which it or any of its
property is bound.
"Conversion/Continuation Date" means any date on which, under
Section 2.4, the Company (a) converts Loans of one Type to another Type, or
(b) continues as Loans of the same Type, but with a new Interest Period,
Loans having Interest Periods expiring on such date.
"Credit Extension" means and includes (a) the making of any
Revolving Loans hereunder, and (b) the Issuance of any Letters of Credit
hereunder.
"Default" means any event or circumstance which, with the giving
of notice, the lapse of time, or both, would (if not cured or otherwise
remedied during such time) constitute an Event of Default.
"Dollars", "dollars" and "$" each mean lawful money of the
United States.
"EBITDA" means, as measured quarterly on the last day of each
fiscal quarter for the four trailing quarters then ending, and determined on
a consolidated basis for the Company and its Restricted Subsidiaries in
accordance with GAAP, an amount equal to, without duplication, the sum of
(a) consolidated net income (or net loss) for such period, plus (b) all
amounts treated as expenses for depreciation, Consolidated Interest Expense,
and the amortization of intangibles and other assets (including non-cash
finance fees and warrants and write-off of goodwill and organizational costs
and expenses) of any kind to the extent included in the determination of
such consolidated net income (or loss), plus (c) all accrued taxes on or
measured by income to the extent included in the determination of such
consolidated net income (or loss), plus (d) amortization of the inventory
write-up associated with purchase accounting related to the Contico
Acquisition pursuant to APB 16; provided, however, that consolidated net
income (or loss) shall be computed for these purposes without giving effect
to extraordinary losses or extraordinary gains or to any gains or losses
associated with the sale or write-down of assets outside the ordinary course
of business and without giving effect to net income or loss attributable to
those operations of the Company and its Subsidiaries planned for divestiture
as set forth in Schedule 1.1B, as the same may be modified by the Company
from time to time by notice to the Agent if accompanied by the corresponding
changes to the accounting treatment of the operations described therein or
removed therefrom for all fiscal periods ending thereafter. Notwithstanding
the foregoing, if, for any four trailing quarters, EBITDA attributable to
Non-Guarantor Subsidiaries represents 15% or more of EBITDA for the Company
and its Restricted Subsidiaries on a consolidated basis, the EBITDA
attributable to Non-Guarantor Subsidiaries shall be excluded to the extent
of such excess. For any Permitted Acquisition after the Closing Date,
(x) EBITDA and Consolidated Interest Expense for the Person to be acquired
shall be based upon such Person rather than by reference to the Company and
its Restricted Subsidiaries, and (y) except for purposes of calculating the
Fixed Charge Coverage Ratio, EBITDA of the Company and its Restricted
Subsidiaries shall include the EBITDA of the Person to be acquired for such
prior periods as reflected in the financial statements for such Person as
long as (1) such financial statements are accompanied by a Compliance
Certificate signed by a Responsible Officer of the Company certifying that
the EBITDA reflected in such financial statements represents no more than
the minimum prospective EBITDA that such Person would contribute to the
consolidated EBITDA of the Company and its Restricted Subsidiaries after
giving pro forma effect to the acquisition of such Person and (2) the
Company has demonstrated the validity of such certification to the Agent's
reasonable satisfaction.
"EBITDAR" means, as measured quarterly on the last day of each
fiscal quarter for the four trailing quarters then ending, and determined on
a consolidated basis for the Company and its Restricted Subsidiaries in
accordance with GAAP, an amount equal to, without duplication, the sum of
(a) EBITDA for such period plus (b) all lease payments under Operating
Leases for such period. Notwithstanding the foregoing, if, for any four
trailing quarters, EBITDAR attributable to Non-Guarantor Subsidiaries
represents 15% or more of EBITDAR for the Company and its Restricted
Subsidiaries on a consolidated basis, the EBITDAR attributable to Non-
Guarantor Subsidiaries shall be excluded to the extent of such excess.
"Effective Amount" means (a) with respect to any Loan on any
date, the aggregate outstanding principal amount thereof after giving effect
to any Borrowings and prepayments or repayments of Loans occurring on such
date, and (b) with respect to any outstanding L/C Obligations on any date,
the amount of such L/C Obligations on such date after giving effect to any
Issuances of Letters of Credit occurring on such date and any other changes
in the aggregate amount of the L/C Obligations as of such date, including as
a result of any reimbursements of outstanding unpaid drawings under any
Letters of Credit or any reductions in the maximum amount available for
drawing under Letters of Credit taking effect on such date.
"Electrical/Electronic Group" means lines of business operated
at the Closing Date by the following Subsidiaries and assets associated
therewith: (i) ▇▇ ▇▇▇▇▇▇▇, Inc. and its subsidiaries ▇▇ ▇▇▇▇▇▇▇/HMO, Inc.
and ▇▇ ▇▇▇▇▇▇▇ International Ltd., (ii) Waldom Electronics, Inc., (iii) Wood
Industries, Inc., and (iv) ▇▇▇▇▇ Industries (Canada), Inc.
"Eligible Assignee" means (a) a commercial bank organized under
the laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $100,000,000, (b) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having a combined capital and
surplus of at least $100,000,000, provided that such bank is acting through
a branch or agency located in the United States, and (c) a Person that is
primarily engaged in the business of commercial banking and that is (i) a
Subsidiary of a Bank, (ii) a Subsidiary of a Person of which a Bank is a
Subsidiary, or (iii) a Person of which a Bank is a Subsidiary.
"Environmental Claims" means all claims, however asserted, by
any Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or
injury to the environment.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities, in each case relating to environmental, health,
safety and land use matters.
"ERISA" means the Employee Retirement Income Security Act of
1974, and regulations promulgated thereunder.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code
for purposes of provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it
was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a withdrawal under
Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the
Company or any ERISA Affiliate from a Multiemployer Plan or notification
that a Multiemployer Plan is in reorganization; (d) the filing of a notice
of intent to terminate, the treatment of a Plan amendment as a termination
under Section 4041 or 4041A of ERISA, or the commencement of proceedings by
the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
condition which might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the
Company or any ERISA Affiliate.
"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate".
"Event of Default" means any of the events or circumstances
specified in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
"Existing Credit Agreement" has the meaning specified in the
recitals hereto.
"Existing Letter of Credit" means any of the letters of credit
issued to the Company or a Restricted Subsidiary by Bank of America pursuant
to the Existing Credit Agreement as listed on Schedule 1.1A.
"Facility" means either Facility A or Facility B.
"Facility A Commitment" has the meaning specified in
subsection 2.1(a).
"Facility A Revolving Termination Date" means the earlier to
occur of:
(a) December 10, 1999, or such later date to which the
Facility A Revolving Termination Date is extended in accordance with
Section 2.16; and
(b) the date on which the Facility A Commitment terminates in
accordance with the provisions of this Agreement
"Facility A Revolving Loan" has the meaning specified in
subsection 2.1(a).
"Facility B Commitment" has the meaning specified in
subsection 2.1(b).
"Facility B Revolving Termination Date" means the earlier to
occur of:
(a) December 11, 2001; and
(b) the date on which the Facility B Commitment terminates in
accordance with the provisions of this Agreement.
"Facility B Revolving Loan" has the meaning specified in
subsection 2.1(b).
"Facility Fee" has the meaning specified in Section 2.10(b).
"Facility Fee Percentage" means with respect to the Facility A
Commitment or the Facility B Commitment, the per annum rates set forth below
opposite the Pricing Level calculated for periods described below. The
terms "Pricing Level" and "Pricing Level Change Date" shall have the
meanings specified in the definition of "Applicable Margin."
Pricing Pricing Ratio Facility A Facility B
Level at End fo Fiscal Quarter Facility Fee Facility Fee
I Less Than 1.00 to 1.00 0.225% 0.250%
II Greater than or equal to 1.00 to
1.00 but less than 1.75 to 1.00 0.275% 0.300%
III Greater than or equal to 1.75 to
1.00 but less than 2.25 to 1.00 0.350% 0.375%
IV. Greater than or equal to 2.25 to
1.00 but less than 2.75 to 1.00 0.400% 0.425%
V. Greater than or equal to 2.75 to
1.00 but less than 3.25 to 1.00 0.425% 0.450%
VI. Greater than or equal to 3.25 to
1.00 0.475% 0.50%
From the Closing Date until the first Pricing Level Change Date, the
Facility Fee Percentage shall correspond to the rates per annum set forth
above opposite Pricing Level V, unless the Company's Pricing Ratio, as
reflected in the Compliance Certificate delivered pursuant to Section 7.2
for the fiscal year ending December 31, 1998, prior to that time dictates
that Pricing Level VI should apply, in which case Pricing Level VI shall
apply from the date three Business Days after such delivery until the first
Pricing Level Change Date; provided, however, if the Contico Acquisition has
not occurred on or before February 26, 1999, then the Facility Fee
Percentage from such date until the first Pricing Level Change Date shall be
based upon the Pricing Ratio reflected in the most recent Compliance
Certificate delivered pursuant to Section 7.2 or pursuant to Section 7.2 of
the Existing Credit Agreement (any change therein taking effect 3 Business
Days after delivery of a more recent Compliance Certificate). The Facility
Fee Percentage shall be adjusted automatically on each Pricing Level Change
Date to correspond with the applicable Pricing Level. If the Company fails
to deliver such financial reports and certificates to the Agent for any
fiscal quarter by the date required hereunder, then the Facility Fee
Percentage beginning three Business Days after such date shall, until three
Business Days after delivery of such financial reports and certificates, be
the next higher Facility Fee Percentage as set forth in the chart above
immediately below the previously effective Facility Fee Percentage; thus, if
the Facility Fee Percentage with respect to Facility B had previously been
0.250%, a failure to deliver quarterly financials on a timely basis would
cause the Facility Fee Percentage with respect to Facility B to be 0.300%
until three Business Days after such delivery.
"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.
"Federal Funds Rate" means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including
any such successor, "H.15(519)") on the preceding Business Day opposite the
caption "Federal Funds (Effective)"; or, if for any relevant day such rate
is not so published on any such preceding Business Day, the rate for such
day will be the arithmetic mean as determined by the Agent of the rates for
the last transaction in overnight Federal funds arranged prior to 9:00 a.m.
(New York City time) on that day by each of three leading brokers of Federal
funds transactions in New York City selected by the Agent.
"Fee Letter" has the meaning specified in subsection 2.10(a).
"Fixed Charge Coverage Ratio" means, as measured quarterly on
the last day of each fiscal quarter for the four trailing quarters then
ending, and determined on a consolidated basis for the Company and its
Restricted Subsidiaries, the ratio of (a) the sum of EBITDAR minus capital
expenditures minus cash taxes to (b) the sum of interest expense (excluding
amortization of up-front financing costs) plus lease payments under
Operating Leases plus scheduled repayments of principal on account of Funded
Debt plus cash dividends paid to Persons other than the Company and its
Wholly Owned Subsidiaries that are Restricted Subsidiaries.
"FRB" means the Board of Governors of the Federal Reserve
System, and any Governmental Authority succeeding to any of its principal
functions.
"Funded Debt" means, at any time, the sum of the following,
computed on a consolidated basis for the Company and its Restricted
Subsidiaries in accordance with GAAP (a) all Indebtedness for borrowed
money, plus (b) Indebtedness on account of drawn but unreimbursed letters of
credit, plus (c) the undrawn face amount of issued and outstanding standby
letters of credit, plus (d) the principal portion of Indebtedness under
Capital Leases, plus (e) Guaranty Obligations with respect to Indebtedness
described in clauses (a) through (d) above; provided, however, that solely
for purposes of calculating Funded Debt, Guaranty Obligations shall not
include the Company's December 31, 1997 guarantee of the 8-1/8% Subordinated
Industrial Development Bonds issued by Bee Gee.
"Further Taxes" means any and all present or future taxes,
levies, assessments, imposts, duties, deductions, fees, withholdings or
similar charges (including, without limitation, net income taxes and
franchise taxes), and all liabilities with respect thereto, imposed by any
jurisdiction on account of amounts payable or paid pursuant to Section 4.1.
"GAAP" means generally accepted accounting principles set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants
and statements and pronouncements of the Financial Accounting Standards
Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which are applicable to
the circumstances as of the date of determination.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Guarantor" means each Material Subsidiary other than the Non-
Guarantor Subsidiaries.
"Guaranty Obligation" has the meaning specified in the
definition of "Contingent Obligation."
"Guaranty" means a Guaranty substantially in the form of Exhibit
G and each "Guaranty" as defined in the Existing Credit Agreement as
reaffirmed in the Reaffirmation of Guaranty executed by each Guarantor as of
the Closing Date.
"Honor Date" has the meaning specified in subsection 3.3(b).
"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than
trade payables entered into in the ordinary course of business on ordinary
terms); (c) all non-contingent reimbursement or payment obligations with
respect to Surety Instruments; (d) all obligations evidenced by notes,
bonds, debentures or similar instruments, including obligations so evidenced
incurred in connection with the acquisition of property, assets or
businesses; (e) all indebtedness created or arising under any conditional
sale or other title retention agreement, or incurred as financing, in either
case with respect to property acquired by the Person (even though the rights
and remedies of the seller or bank under such agreement in the event of
default are limited to repossession or sale of such property); (f) all
obligations with respect to capital leases; (g) all indebtedness referred to
in clauses (a) through (f) above secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien upon or in property (including accounts and contracts rights)
owned by such Person, even though such Person has not assumed or become
liable for the payment of such indebtedness; and (h) all Guaranty
Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (a) through (g) above. For all purposes of this
Agreement, the Indebtedness of any Person shall include all recourse
Indebtedness of any partnership or joint venture or limited liability
company in which such Person is a general partner or a joint venturer or a
member.
"Indemnified Liabilities" has the meaning specified in
Section 11.5.
"Indemnified Person" has the meaning specified in Section 11.5.
"Independent Auditor" has the meaning specified in
subsection 7.1(a).
"Intercompany Advance" means loans made by the Company to any
Restricted Subsidiaries, which loans shall (a) be maintained in book entry
form and not, unless requested by the Agent, evidenced by a promissory note
or other negotiable instrument, and (b) be subordinated to repayment of the
Obligations as provided in the Guaranties.
"Insolvency Proceeding" means, with respect to any Person, (a)
any case, action or proceeding with respect to such Person before any court
or other Governmental Authority relating to bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding-up or relief of
debtors, or (b) any general assignment for the benefit of creditors,
composition, marshalling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any substantial portion
of its creditors undertaken under U.S. Federal, state or foreign law,
including the Bankruptcy Code.
"Interest Payment Date" means, as to any Loan other than a Base
Rate Loan, the last day of each Interest Period applicable to such Loan and,
as to any Base Rate Loan, the last Business Day of each calendar quarter,
provided, however, that if any Interest Period for a Offshore Rate Loan
exceeds three months, the date that falls three months after the beginning
of such Interest Period and after each Interest Payment Date thereafter is
also an Interest Payment Date.
"Interest Period" means, as to any Offshore Rate Loan, the
period commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending on the date one, two, three
or six months thereafter (and any other period that is 12 months or less and
is consented to by all Banks in the given instance) as selected by the
Company in its Notice of Borrowing or Notice of Conversion/Continuation
provided that:
(a) if any Interest Period would otherwise end on a day that
is not a Business Day, that Interest Period shall be extended to the
following Business Day unless, in the case of an Offshore Rate Loan, the
result of such extension would be to carry such Interest Period into another
calendar month, in which event such Interest Period shall end on the
preceding Business Day;
(b) any Interest Period pertaining to an Offshore Rate Loan
that begins on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at the
end of such Interest Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period;
(c) no Interest Period for any Facility A Revolving Loan shall
extend beyond the Facility A Maturity Date; and
(d) no Interest Period for any Facility B Revolving Loan shall
extend beyond the Facility B Maturity Date.
"Investment" has the meaning specified in Section 8.4.
"IRS" means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
"Issuance Date" has the meaning specified in subsection 3.1(a).
"Issue" means, with respect to any Letter of Credit to issue or
to extend the expiration of, or to renew or increase the amount of, such
Letter of Credit; and the terms "Issued," "Issuing" and "Issuance", whether
or not capitalized, have corresponding meanings.
"Issuing Affiliate" shall have the meaning specified in Section
3.11.
"Issuing Bank" means Bank of America in its capacity as issuer
of one or more Letters of Credit hereunder, together with any replacement
letter of credit issuer arising under subsection 10.1(b) or Section 10.9.
"Joint Venture" means a partnership, limited liability company,
joint venture or other similar legal arrangement (whether created by
contract or conducted through a separate legal entity) now or hereafter
formed by the Company or any of its Subsidiaries with another Person in
order to conduct a common venture or enterprise with such Person.
"L/C Advance" means each Bank's participation in any L/C
Borrowing in accordance with its Pro Rata Share.
"L/C Amendment Application" means an application form for
amendment of outstanding standby or commercial documentary letters of credit
as shall at any time be in use at the Issuing Bank, as the Issuing Bank
shall request.
"L/C Application" means an application form for issuances of
standby or commercial documentary letters of credit as shall at any time be
in use at the Issuing Bank, as the Issuing Bank shall request.
"L/C Borrowing" means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been reimbursed on
the date when made nor converted into a Borrowing of Revolving Loans under
subsection 3.3(c).
"L/C Fee Percentage" means at any time, the Applicable Margin
then applicable to Facility A Offshore Rate Loans.
"L/C Obligations" means at any time the sum of (a) the aggregate
undrawn amount of all Letters of Credit then outstanding, plus (b) the
amount of all unreimbursed drawings under all Letters of Credit, including
all outstanding L/C Borrowings.
"L/C-Related Documents" means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document relating
to any Letter of Credit, including any of the Issuing Bank's standard form
documents for letter of credit issuances.
"L/C Subsidiary" shall have the meaning specified in
subsection 3.10(a).
"Lending Office" means, as to any Bank, the office or offices of
such Bank specified as its "Lending Office" or "Domestic Lending Office" or
"Offshore Lending Office", as the case may be, on Schedule 11.2, or
such
other office or offices as such Bank may from time to time notify the
Company and the Agent.
"Letters of Credit" means (a) any letters of credit (whether
Standby Letters of Credit or Commercial Letters of Credit) Issued by the
Issuing Bank pursuant to Article III, and (b) the Existing Letters of
Credit.
"Leverage Ratio" means, as measured quarterly on the last day of
each fiscal quarter for the four trailing quarters then ending, and
determined on a consolidated basis for the Company and its Restricted
Subsidiaries, the ratio of Funded Debt to EBITDA.
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of any
kind or nature whatsoever in respect of any property (including those
created by, arising under or evidenced by any conditional sale or other
title retention agreement, the interest of a lessor under a capital lease,
any financing lease having substantially the same economic effect as any of
the foregoing, or the filing of any financing statement naming the owner of
the asset to which such lien relates as debtor, under the Uniform Commercial
Code or any comparable law) and any contingent or other agreement to provide
any of the foregoing, but not including the interest of a lessor under an
Operating Lease.
"Loan" means an extension of credit by a Bank to the Company
under Article II or Article III in the form of a Revolving Loan or L/C
Advance.
"Loan Documents" means this Agreement, any Notes, the Fee
Letter, the Participation Fee Letters, the L/C-Related Documents, the
Specified Swap Contracts, and all other documents delivered to the Agent or
any Bank in connection herewith.
"Machinery Manufacturing Group" means lines of business
operated at the Closing Date by the following Subsidiaries and divisions and
assets associated therewith: (i) the Airtronics division of American Gage &
Machine, (ii) ▇▇▇▇-▇▇▇▇▇▇▇, Inc., (iii) ▇▇▇▇-▇▇▇▇▇▇▇ Limited, (iv) ▇▇▇▇▇
Machines, Inc., and (v) ▇▇▇▇▇▇ Machinery Company.
"Maintenance Group" means lines of business operated at the
Closing Date by the following Subsidiaries or divisions and assets
associated therewith: (i) Duckback Products, Inc. (ii) Glit/Gemtex Limited,
(iii) Glit/Gemtex, Inc. (iv) Glit/Microtron Canada, (v) the Glit, Microtron
and ▇▇▇▇▇ divisions of Hallmark Holdings, Inc., (vi) Glit DISCO, Inc., and
(vii) ▇▇▇▇▇ Products, Inc.
"Margin Stock" means "margin stock" as such term is used in
Regulation T, U or X of the FRB.
"Material Adverse Effect" means (a) a material adverse change
in, or a material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) or prospects of the Company or the
Company and its Restricted Subsidiaries taken as a whole; (b) a material
impairment of the ability of the Company to perform under any Loan Document
and to avoid any Event of Default or of the ability of the Company and its
Restricted Subsidiaries taken as a whole to perform under the Loan Documents
and to avoid any Event of Default; or (c) a material adverse effect upon the
legality, validity, binding effect or enforceability against the Company or
any Restricted Subsidiary of any Loan Document.
"Material Subsidiary" means each Restricted Subsidiary other
than any Restricted Subsidiary that does not have material operations and in
any event for the most recent four fiscal quarters has generated revenue
from operations of less than $100,000, and that has a net worth, determined
in accordance with GAAP on a consolidated basis for such Subsidiary and its
Subsidiaries, of less than $100,000; provided, however, that if all
Restricted Subsidiaries that are not Material Subsidiaries at any time have
such a net worth on an aggregate basis in excess of $1,000,000 (subject to
such exclusion of subordinated Indebtedness), all Restricted Subsidiaries
shall constitute Material Subsidiaries.
"▇▇▇▇▇▇▇▇▇▇" means NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities LLC, a
Delaware limited liability company.
"Multiemployer Plan" means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, to which the Company or any ERISA
Affiliate makes, is making, or is obligated to make contributions or, during
the preceding three calendar years, has made, or been obligated to make,
contributions.
"Net Worth" means, as of any date of determination as determined
on a consolidated basis for the Company and its Restricted Subsidiaries in
accordance with GAAP, total stockholders' equity plus the book value of the
Preferred Units, in each case as of the end of the most recent fiscal
quarter for which financial statements have been delivered pursuant to
Section 7.1.
"Non-Guarantor Subsidiary" means a Restricted Subsidiary that is
not organized in the United States unless the Company has entered into
pledge documentation reasonably satisfactory to the Agent and the Required
Banks and taken other action reasonably requested by the Agent to establish
and perfect in favor of the Agent and the Banks a first priority perfected
security interest in and pledge of 66% of the shares of capital stock of
such Restricted Subsidiary.
"Note" means a promissory note executed by the Company in favor
of a Bank pursuant to subsection 2.2(b), in substantially the form of
Exhibit F.
"Notice of Borrowing" means a notice in substantially the form
of Exhibit A.
"Notice of Conversion/Continuation" means a notice in
substantially the form of Exhibit B.
"Obligations" means all advances, debts, liabilities,
obligations, covenants and duties arising under any Loan Document owing by
the Company to any Bank, the Agent, or any Indemnified Person, whether
direct or indirect (including those acquired by assignment), absolute or
contingent, due or to become due, now existing or hereafter arising.
"Offshore Rate" means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of
interest per annum (rounded upward to the next 1/16th of 1%) determined by
the Agent as follows:
LIBOR
Offshore Rate = ------------------------------------
1.00 - Eurodollar Reserve Percentage
Where
"Eurodollar Reserve Percentage" means for any day
for any Interest Period the maximum reserve percentage
(expressed as a decimal, rounded upward to the next 1/100th of
1%) in effect on such day (whether or not applicable to any
Bank) under regulations issued from time to time by the FRB for
determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as
"Eurocurrency liabilities"); and
"LIBOR" means the rate per annum (rounded upwards,
if necessary, to the nearest 1/100 of 1%) appearing on Telerate
Page 3750 (or any successor page) as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of the
relevant Interest Period for a term comparable to such Interest
Period. If for any reason such rate is not available, the term
"LIBOR" shall mean, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters
Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of the relevant
Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on Reuters
Screen LIBO Page, the applicable rate shall be the arithmetic
mean of all such rates.
"Offshore Rate Loan" means a Loan that bears interest based on
the Offshore Rate.
"Operating Lease" means, as applied to any Person, a lease of
property which is not a Capital Lease.
"Organization Documents" means, for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate of
determination or instrument relating to the rights of preferred shareholders
of such corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation and for any partnership, its partnership agreement and
certificate of partnership.
"Other Taxes" means any present or future stamp, court or
documentary taxes or any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or from the execution,
delivery, performance, enforcement or registration of, or otherwise with
respect to, this Agreement or any other Loan Documents.
"Participant" has the meaning specified in subsection 11.8(d).
"Participation Fee Letters" has the meaning specified in
subsection 2.10(a).
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under
ERISA.
"Pension Plan" means a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA which the Company sponsors,
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding five (5) plan years.
"Permitted Acquisition" means an Acquisition complying with
subsection 8.4(f).
"Permitted Liens" has the meaning specified in Section 8.1.
"Permitted Stock Repurchase" is defined in subsection 8.11(c).
"Permitted Swap Obligations" means all obligations (contingent
or otherwise) of the Company or any Restricted Subsidiary existing or
arising under Swap Contracts, provided that each of the following criteria
is satisfied: (a) such obligations are (or were) entered into by such
Person in the ordinary course of business for the purpose of directly
mitigating risks associated with liabilities, commitments or assets held or
reasonably anticipated by such Person, or changes in the value of securities
issued by such Person in conjunction with a securities repurchase program
not otherwise prohibited hereunder, and not for purposes of speculation or
taking a "market view;" (b) such Swap Contracts do not contain any provision
("walk-away" provision) exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the defaulting
party.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in
Section 3(3) of ERISA) which the Company sponsors or maintains or to which
the Company makes, is making, or is obligated to make contributions and
includes any Pension Plan.
"Preferential Payment" shall have the meaning specified in
subsection 3.10(c).
"Preferred Units" means the preferred units in the Acquired
Company to be issued to Contico as described in the Purchase Agreement.
"Pricing Ratio" means, as measured quarterly on the last day of
each fiscal quarter for the four trailing quarters then ending, and
determined on a consolidated basis for the Company and its Restricted
Subsidiaries, the ratio of (a) Funded Debt minus the undrawn face amount of
issued and outstanding standby letters of credit, to (b) EBITDA.
"Pro Rata Share" means, as to any Bank at any time, the
percentage equivalent (expressed as a decimal, rounded to the ninth decimal
place) at such time of such Bank's Commitment divided by the aggregate
Commitments.
"Purchase Agreement" means the Unit Purchase Agreement as
intended to be entered into by and among the Company and Contico pursuant to
the letter of intent dated September 8, 1998.
"Replacement Bank" has the meaning specified in Section 4.7.
"Reportable Event" means, any of the events set forth in
Section 4043(c) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
"Required Banks" means at any time Banks then holding at least
66-2/3% of the then aggregate unpaid principal amount of the Loans, or, if
no such principal amount is then outstanding, Banks then having at least 66-
2/3% of the Commitments.
"Requirement of Law" means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an arbitrator or
of a Governmental Authority, in each case applicable to or binding upon the
Person or any of its property or to which the Person or any of its property
is subject.
"Responsible Officer" means the chief executive officer or the
president of the Company, or any other officer having substantially the same
authority and responsibility; or, with respect to compliance with financial
covenants, the chief financial officer or the treasurer of the Company, or
any other officer having substantially the same authority and
responsibility.
"Restricted Subsidiary" means any Subsidiary of the Company that
is not an Unrestricted Subsidiary.
"Revolving Loan" means any of the Facility A Revolving Loans or
the Facility B Revolving Loans, which may be a Base Rate Loan or an Offshore
Rate Loan (each, a "Type" of Revolving Loan), and any reference to Revolving
Loans also applies to both the Facility A Revolving Loans and the Facility B
Revolving Loans.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"▇▇▇▇▇" means Savannah Energy Systems Company, a Georgia limited
partnership.
"▇▇▇▇▇ Service Agreement" means the Service Agreement dated as
of December 1, 1994, by and between Resource Recovery Development Authority
for the City of Savannah and ▇▇▇▇▇.
"Specified Swap Contract" means any Swap Contract made or
entered into at any time, or in effect at any time (whether heretofore or
hereafter), whether directly or indirectly, and whether as a result of
assignment or transfer or otherwise, between the Company or any Restricted
Subsidiary of the Company and any Swap Provider which Swap Contract is or
was intended by the Company to have been entered into, in part or entirely,
for purposes of mitigating interest rate or currency exchange risk relating
to any Loan (which intent shall conclusively be deemed to exist if the
Company so represents to the Swap Provider in writing), and as to which the
final scheduled payment by the Company or its Subsidiary is not later than
the Facility B Revolving Termination Date.
"Standby Letter of Credit" means a Letter of Credit other than a
Commercial Letter of Credit.
"Standby L/C Commitment" means the commitment of the Issuing
Bank to Issue, and the commitment of the Banks severally to participate in,
Standby Letters of Credit from time to time Issued or outstanding under
Article III, in an aggregate amount not to exceed on any date the amount of
$10,000,000, as the same shall be reduced as a result of a reduction in the
Standby L/C Commitment pursuant to Section 2.6; provided that the Standby
L/C Commitment is a part of the combined Facility A Commitments, rather than
a separate, independent commitment.
"Subsidiary" of a Person means any corporation , association,
partnership, limited liability company, joint venture or other business
entity of which more than 50% of the voting stock, membership or other
equity interests with voting power (in the case of Persons other than
corporations), is owned or controlled directly or indirectly by the Person,
or one or more of the Subsidiaries of the Person, or a combination thereof.
Unless the context otherwise clearly requires, references herein to a
"Subsidiary" refer to a Subsidiary of the Company.
"Surety Instruments" means all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties, shipside
bonds, surety bonds and similar instruments.
"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap
or option, bond, note or ▇▇▇▇ option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or any
combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.
"Swap Provider" means any Bank, or any Affiliate of any Bank,
that is at the time of determination party to a Swap Contract with the
Company or any Restricted Subsidiary.
"Swap Termination Value" means, in respect of any one or more
Swap Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Swap Contracts, (a) for any
date on or after the date such Swap Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a)
the amount(s) determined as the ▇▇▇▇-to-market value(s) for such Swap
Contracts, as determined based upon one or more mid-market or other readily
available quotations provided by any recognized dealer in such Swap
Contracts (which may include any Bank).
"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of
each Bank and the Agent, respectively, taxes imposed on or measured by its
net income by the jurisdiction (or any political subdivision thereof) under
the laws of which such Bank or the Agent, as the case may be, is organized
or maintains a lending office.
"Type" has the meaning specified in the definition of "Revolving
Loan."
"Unfunded Pension Liability" means the excess of a Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current
value of that Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code for
the applicable plan year.
"United States" and "U.S." each means the United States of
America.
"Unrestricted Subsidiary" means any Subsidiary designated by the
Company, upon the prior written consent of the Required Banks, as an
Unrestricted Subsidiary.
"Wholly Owned Subsidiary" means any Subsidiary in which (other
than directors' qualifying shares required by law) 100% of the equity
interests of each class having ordinary voting power, and 100% of the equity
interests of every other class, in each case, at the time as of which any
determination is being made, is owned, beneficially and of record, by the
Company, or by one of the other Wholly Owned Subsidiaries, or both.
Notwithstanding the foregoing, the ownership by Contico or any other Person
of the Preferred Units shall not cause the Acquired Company to not
constitute a Wholly Owned Subsidiary of the Company after the Acquisition.
"▇▇▇▇▇ Industries" means ▇▇▇▇▇ Industries, Inc., a Subsidiary of
the Company.
"Year 2000 Compliant" shall have the meaning specified in
Section 6.20.
"Year 2000 Problem" shall have the meaning specified in Section
6.20.
1.2 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to
the singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar
words refer to this Agreement as a whole and not to any particular provision
of this Agreement; and subsection, Section, Schedule and Exhibit references
are to this Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all
instruments, documents, agreements, certificates, indentures, notices and
other writings, however evidenced.
(ii) The term "including" is not limiting and means
"including without limitation."
(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including"; the words "to" and "until" each mean "to but excluding", and the
word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual instruments
shall be deemed to include all subsequent amendments and other modifications
thereto, but only to the extent such amendments and other modifications are
not prohibited by the terms of any Loan Document, and (ii) references to any
statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting the statute or regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of
this Agreement.
(f) This Agreement and other Loan Documents may use several
different limitations, tests or measurements to regulate the same or similar
matters. All such limitations, tests and measurements are cumulative and
shall each be performed in accordance with their terms. Unless otherwise
expressly provided, any reference to any action of the Agent or the Banks by
way of consent, approval or waiver shall be deemed modified by the phrase
"in its/their sole discretion."
(g) This Agreement and the other Loan Documents are the result
of negotiations among and have been reviewed by counsel to the Agent, the
Company and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Banks or the Agent
merely because of the Agent's or Banks' involvement in their preparation.
1.3 Accounting Principles.
(a) Except as otherwise expressly provided in this Agreement,
all accounting terms used in this Agreement shall be interpreted, and all
financial statements and certificates and reports as to financial matters
required to be delivered to the Agent and the Banks under this Agreement
shall (unless otherwise disclosed to the Agent in writing at the time of
delivery) be prepared, in accordance with GAAP applied on a basis consistent
with those used in the preparation of the latest financial statements
furnished to the Agent and the Banks under this Agreement. All calculations
made for purposes of determining compliance with this Agreement shall
(except as otherwise expressly provided for in this Agreement) be made by
application of GAAP applied on a basis consistent with those used in the
preparation of the latest annual or quarterly financial statements furnished
to the Agent and the Banks pursuant to Section 7.1 unless (i) the Company
shall have objected to determining such compliance on such basis at the time
of delivery of such financial statements or (ii) the Agent on behalf of the
Required Banks shall so object in writing within 30 days after delivery of
such financial statements, in either of which events such calculations shall
be made on a basis consistent with those used in the preparation of the
latest financial statements as to which such objection shall not have been
made.
(b) References herein to "fiscal year" and "fiscal quarter"
refer to such fiscal periods of the Company.
ARTICLE II.
THE CREDITS
2.1 Amounts and Terms of Commitments.
(a) The Facility A Revolving Credit. Each Bank severally
agrees, on the terms and conditions set forth herein, to make loans to the
Company (each such loan, a "Facility A Revolving Loan") from time to time on
any Business Day during the period from the Closing Date to the Facility A
Revolving Termination Date, in an aggregate amount not to exceed at any time
outstanding the amount set forth opposite such Bank's name on Schedule 2.1
(such amount as the same may be reduced under Section 2.5 or as a result of
one or more assignments under Section 11.8, the Bank's "Facility A
Commitment"); provided, however, that, after giving effect to any Borrowing
of Facility A Revolving Loans, (i) the Effective Amount of all outstanding
Facility A Revolving Loans and the Effective Amount of all L/C Obligations
shall not at any time exceed the combined Facility A Commitments, and (ii)
the Effective Amount of the Facility A Revolving Loans of any Bank plus the
participation of such Bank in the Effective Amount of all L/C Obligations
shall not at any time exceed such Bank's Facility A Commitment. Within the
limits of each Bank's Facility A Commitment, and subject to the other terms
and conditions hereof, the Company may borrow under this subsection 2.1(a),
prepay under Section 2.6 and reborrow under this subsection 2.1(a).
(b) The Facility B Revolving Credit. Each Bank severally
agrees, on the terms and conditions set forth herein, to make loans to the
Company (each such loan, a "Facility B Revolving Loan") from time to time on
any Business Day during the period from the Closing Date to the Facility B
Revolving Termination Date, in an aggregate amount not to exceed at any time
outstanding the amount set forth opposite such Bank's name on Schedule 2.1
(such amount as the same may be reduced by the last sentence of this
subsection, by Section 2.5, or as a result of one or more assignments under
Section 11.8, the Bank's "Facility B Commitment"); provided, however, that,
after giving effect to any Borrowing of Facility B Revolving Loans, (i) the
Effective Amount of all outstanding Facility B Revolving Loans shall not at
any time exceed the combined Facility B Commitments, and (ii) the Effective
Amount of the Facility B Revolving Loans of any Bank shall not at any time
exceed such Bank's Facility B Commitment. Within the limits of each Bank's
Facility B Commitment, and subject to the other terms and conditions hereof,
the Company may borrow under this subsection 2.1(b), prepay under
Section 2.6 and reborrow under this subsection 2.1(b). Notwithstanding
anything contained in this subsection 2.1(b), (a) the Effective Amount of
Facility B Revolving Loans shall not exceed $30,000,000.00 unless and until
all conditions precedent in Section 5.2 are satisfied, and (b) if the
Contico Acquisition does not occur on or before February 26, 1999, as of
February 26, 1999 the Facility B Revolving Credit shall be permanently
reduced to $30,000,000.00.
2.2 Loan Accounts.
(a) The Loans made by each Bank and the Letters of Credit
Issued by the Issuing Bank shall be evidenced by one or more accounts or
records maintained by such Bank or Issuing Bank, as the case may be, in the
ordinary course of business. The accounts or records maintained by the
Agent, the Issuing Bank and each Bank shall be conclusive absent manifest
error of the amount of the Loans made by the Banks to the Company and the
Letters of Credit Issued for the account of the Company, and the interest
and payments thereon. Any failure so to record or any error in doing so
shall not, however, limit or otherwise affect the obligation of the Company
hereunder to pay any amount owing with respect to the Loans or any Letter of
Credit.
(b) Upon the request of any Bank made through the Agent, the
Loans made by such Bank may be evidenced by one or more Notes, instead of or
in addition to loan accounts. Each such Bank shall endorse on the schedules
annexed to its Note(s) the date, amount and maturity of each Loan made by it
and the amount of each payment of principal made by the Company with respect
thereto. Each such Bank is irrevocably authorized by the Company to endorse
its Note(s) and each Bank's record shall be conclusive absent manifest
error; provided, however, that the failure of a Bank to make, or an error in
making, a notation thereon with respect to any Loan shall not limit or
otherwise affect the obligations of the Company hereunder or under any such
Note to such Bank.
2.3 Procedure for Borrowing.
(a) Each Borrowing of Revolving Loans shall be made upon the
Company's irrevocable written notice delivered to the Agent in the form of a
Notice of Borrowing (which notice must be received by the Agent prior to
9:00 a.m. (San Francisco time) (i) three Business Days prior to the
requested Borrowing Date, in the case of Offshore Rate Loans, and (ii) on
the requested Borrowing Date, in the case of Base Rate Loans, specifying:
(A) the amount of the Borrowing, which shall be in an
aggregate minimum amount of $2,000,000 or any multiple of $1,000,000
in excess thereof;
(B) the requested Borrowing Date, which shall be a
Business Day;
(C) the Type of Loans comprising the Borrowing; and
(D) the duration of the Interest Period applicable to
such Loans included in such notice. If the Notice
of Borrowing fails to specify the duration of the
Interest Period for any Borrowing comprised of
Offshore Rate Loans, such Interest Period shall be
one month;
(b) The Agent will promptly notify each Bank of its receipt of
any Notice of Borrowing and of the amount of such Bank's Pro Rata Share of
that Borrowing.
(c) Each Bank will make the amount of its Pro Rata Share of
each Borrowing available to the Agent for the account of the Company at the
Agent's Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing
Date requested by the Company in funds immediately available to the Agent.
The proceeds of all such Loans will then be made available to the Company by
the Agent at such office by crediting the account of the Company on the
books of Bank of America with the aggregate of the amounts made available to
the Agent by the Banks and in like funds as received by the Agent or, if
requested by the Company, by wire transfer of such fund in accordance with
written instructions provided to the Agent by the Company, less the Agent's
customary fees for such wire transfer; provided, however, that (i) the
initial Facility A Loans and Facility B Loans shall be applied directly by
the Agent to the repayment of the "Facility A Loans" and "Facility B Loans"
under the Existing Credit Agreement to the extent thereof, and (ii) the
proceeds of the Revolving Loans used to finance the Contico Acquisition will
be made available pursuant to such escrow or other arrangements as may be
mutually satisfactory to the Agent and the Company.
(d) After giving effect to any Borrowing, unless the Agent
shall otherwise consent, there may not be more than ten (10) different
Interest Periods in effect.
2.4 Conversion and Continuation Elections.
(a) The Company may, upon irrevocable written notice to the
Agent in accordance with subsection 2.4(b):
(i) elect, as of any Business Day, in the case of Base
Rate Loans, or as of the last day of the applicable Interest Period, in the
case of any other Offshore Rate Loans, to convert any such Loans (or any
part thereof in an amount not less than $2,000,000, or that is in an
integral multiple of $1,000,000 in excess thereof) into Loans of any other
Type; or
(ii) elect as of the last day of the applicable Interest
Period, to continue any Revolving Loans having Interest Periods expiring on
such day (or any part thereof in an amount not less than $2,000,000, or that
is in an integral multiple of $1,000,000 in excess thereof);
provided, that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion
of part thereof to be less than $2,000,000, such Offshore Rate Loans shall
automatically convert into Base Rate Loans, and on and after such date the
right of the Company to continue such Loans as, and convert such Loans into,
Offshore Rate Loans shall terminate.
(b) The Company shall deliver a Notice of
Conversion/Continuation to be received by the Agent not later than 9:00 a.m.
(San Francisco time) at least (i) three Business Days in advance of the
Conversion/ Continuation Date, if the Loans are to be converted into or
continued as Offshore Rate Loans; and (ii) on the Conversion/Continuation
Date, if the Loans are to be converted into Base Rate Loans, specifying:
(A) the proposed Conversion/Continuation Date;
(B) the aggregate amount of Loans to be converted or
continued;
(C) the Type of Loans resulting from the proposed
conversion or continuation; and
(D) other than in the case of conversions into Base Rate
Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable
to Offshore Rate Loans, the Company has failed to select timely a new
Interest Period to be applicable to such Offshore Rate Loans, or if any
Default or Event of Default then exists, the Company shall be deemed to have
elected to convert such Offshore Rate Loans into Base Rate Loans effective
as of the expiration date of such Interest Period.
(d) The Agent will promptly notify each Bank of its receipt of
a Notice of Conversion/Continuation or, if no timely notice is provided by
the Company, the Agent will promptly notify each Bank of the details of any
automatic conversion. All conversions and continuations shall be made
ratably according to the respective outstanding principal amounts of the
Loans with respect to which the notice was given held by each Bank.
(e) Unless the Required Banks otherwise consent, during the
existence of a Default or Event of Default, the Company may not elect to
have a Loan converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of
Loans, unless the Agent shall otherwise consent, there may not be more than
ten (10) different Interest Periods in effect.
2.5 Voluntary Termination or Reduction of Commitments.
The Company may, upon not less than five Business Days' prior
notice to the Agent, terminate the Facility A Commitments or the Facility B
Commitments, or permanently reduce the Facility A Commitments or Facility B
Commitments by an aggregate minimum amount of $5,000,000 or any multiple of
$1,000,000 in excess thereof; unless, after giving effect thereto and to any
prepayments of Loans made on the effective date thereof, (a) the Effective
Amount of all Facility A Revolving Loans and L/C Obligations together would
exceed the amount of the Facility A Commitments then in effect, (b) the
Effective Amount of all Commercial L/C Obligations then outstanding would
exceed the Commercial L/C Commitment, (c) the Effective Amount of all
Standby L/C Obligations would exceed the Standby L/C Commitment, or (d) the
Effective Amount of all Facility B Revolving Loans then outstanding would
exceed the Facility B Commitment. Once reduced in accordance with this
Section, neither the Facility A Commitments, Facility B Commitments,
Commercial L/C Commitments, nor the Standby L/C Commitments may be
increased. Any reduction of the Commitments shall be applied to each Bank
according to its respective Pro Rata Share. Any reduction in the Facility A
Commitments will correspondingly reduce the Commercial L/C Commitment, and
any reduction in the Facility A Commitments below $10,000,000 will
correspondingly reduce the Standby L/C Commitment. All accrued Facility
Fees to, but not including, the effective date of any reduction or
termination of Commitments, shall be paid on the effective date of such
reduction or termination.
2.6 Optional Prepayments.
Subject to Section 4.4, the Company may, at any time or from
time to time, upon not less than (i) one Business Day's irrevocable notice
to the Agent, in the case of Base Rate Loans, or (ii) three Business Days'
irrevocable notice to the Agent, in the case of Offshore Rate Loans, ratably
prepay Loans in whole or in part, in minimum amounts of $2,000,000 or any
multiple of $1,000,000 in excess thereof. Such notice of prepayment shall
specify the date and amount of such prepayment and the Type(s) of Loans to
be prepaid. The Agent will promptly notify each Bank of its receipt of any
such notice, and of such Bank's Pro Rata Share of such prepayment. If such
notice is given by the Company, the Company shall make such prepayment and
the payment amount specified in such notice shall be due and payable on the
date specified therein, together with accrued interest of Offshore Rate
Loans to each such date on the amount of Offshore Rate Loans prepaid and any
amounts required pursuant to Section 4.4.
2.7 Mandatory Prepayments of Loans; Mandatory Commitment Reductions.
If on any date the Effective Amount of Commercial L/C
Obligations exceeds the Commercial L/C Commitment, the Company shall Cash
Collateralize on such date the outstanding Commercial Letters of Credit in
an amount equal to such excess. If on any date the Effective Amount of
Standby L/C Obligations exceeds the Standby L/C Commitment, the Company
shall Cash Collateralize on such date the outstanding Standby Letters of
Credit in an amount equal to such excess. Subject to Section 4.4, if on any
date after giving effect to any Cash Collateralization made on such date
pursuant to the two preceding sentences, the Effective Amount of all
Facility A Revolving Loans then outstanding plus the Effective Amount of all
L/C Obligations exceeds the combined Facility A Commitments, the Company
shall immediately, and without notice or demand, prepay the outstanding
principal amount of the Facility A Revolving Loans and L/C Advances by an
amount equal to such excess. If on any date the Effective Amount of all
Facility B Revolving Loans then outstanding exceeds the combined Facility B
Commitments, the Company shall immediately, and without notice or demand,
prepay the outstanding principal amount of the Facility B Revolving Loans by
an amount equal to such excess. If on any date the Effective Amount of all
Loans and all L/C Obligations exceeds the combined Commitments, the Company
shall immediately, and without notice or demand, prepay the outstanding
principal amount of the Loans by an amount equal to such excess.
2.8 Repayment.
The Company shall repay to the Banks on the Facility A Revolving
Termination Date the aggregate principal amount of Facility A Revolving
Loans outstanding on such date. The Company shall repay to the Banks on the
Facility B Revolving Termination Date the aggregate principal amount of
Facility B Revolving Loans outstanding on such date.
2.9 Interest.
(a) Each Revolving Loan shall bear interest on the outstanding
principal amount thereof from the applicable Borrowing Date at a rate per
annum equal to the Offshore Rate or the Base Rate, as the case may be (and
subject to the Company's right to convert to other Types of Loans under
Section 2.4), plus the Applicable Margin.
(b) Interest on each Revolving Loan shall be paid in arrears
on each Interest Payment Date. Interest on Offshore Rate Loans shall also
be paid on the date of any prepayment of Offshore Rate Loans under
Section 2.6 or 2.7 for the portion of the Loans so prepaid and upon payment
(including prepayment) in full thereof and, during the existence of any
Event of Default, interest shall be paid on demand of the Agent at the
request or with the consent of the Required Banks.
(c) Notwithstanding subsection (a) of this Section, while any
Event of Default exists or after acceleration, the Company shall pay
interest (after as well as before entry of judgment thereon to the extent
permitted by law) on the principal amount of all outstanding Obligations, at
a rate per annum which is determined by adding 2% per annum to the
Applicable Margin then in effect for such Loans and, in the case of
Obligations not subject to an Applicable Margin, at a rate per annum equal
to the Base Rate plus 2%; provided, however, that, on and after the
expiration of any Interest Period applicable to any Offshore Rate Loan
outstanding on the date of occurrence of such Event of Default or
acceleration, the principal amount of such Loan shall, during the
continuation of such Event of Default or after acceleration, bear interest
at a rate per annum equal to the Base Rate plus the Applicable Margin then
in effect for Base Rate Loans plus 2%.
(d) Anything herein to the contrary notwithstanding, the
obligations of the Company to any Bank hereunder shall be subject to the
limitation that payments of interest shall not be required for any period
for which interest is computed hereunder, to the extent (but only to the
extent) that contracting for or receiving such payment by such Bank would be
contrary to the provisions of any law applicable to such Bank limiting the
highest rate of interest that may be lawfully contracted for, charged or
received by such Bank, and in such event the Company shall pay such Bank
interest at the highest rate permitted by applicable law.
2.10 Fees.
In addition to certain fees described in Section 3.8:
(a) Certain Fees. The Company shall pay such fees to
▇▇▇▇▇▇▇▇▇▇ and Bank of America for ▇▇▇▇▇▇▇▇▇▇'▇ and Bank of America's own
account, and shall pay such fees to the Agent for the Agent's own account,
as required by the letter agreement ("Fee Letter") among the Company,
▇▇▇▇▇▇▇▇▇▇ and the Agent, dated October 14, 1998. In addition, the Company
shall pay to the Agent on the Closing Date for the account of each Bank a
one-time fee in the amounts specified in letter agreements, dated as of the
date hereof, between the Company and each Bank (the "Participation Fee
Letters").
(b) Facility Fees. The Company shall pay to the Agent for the
account of each Bank a facility fee ("Facility Fee") for each day from the
Closing Date to the termination of the Commitments in an amount equal to the
product of (i) such Bank's Commitments in effect on such date multiplied by
(ii) 1/360th of the Facility Fee Percentage in effect on such day. Such
Facility Fee shall be due and payable quarterly in arrears on December 31,
1998 and thereafter on the last Business Day of each calendar quarter
through the Facility B Revolving Termination Date, with the final payment to
be made on the Facility B Revolving Termination Date; provided that, in
connection with any reduction or termination of Commitments under
Section 2.5 or Section 2.7, the accrued Facility Fee for the period ending
on such date shall also be paid on the date of such reduction or
termination, with the following quarterly payment being calculated on the
basis of the period from such reduction or termination date to such
quarterly payment date. The Facility Fees provided in this subsection shall
accrue at all times after the above-mentioned commencement date, including
at any time during which one or more conditions in Article V are not met.
2.11 Computation of Fees and Interest.
(a) All computations of interest for Base Rate Loans when the
Base Rate is determined by Bank of America's "reference rate" or any
successor rate shall be made on the basis of a year of 365 or 366 days, as
the case may be, and actual days elapsed. All other computations of fees
and interest shall be made on the basis of a 360-day year and actual days
elapsed (which results in more interest being paid than if computed on the
basis of a 365-day year). Interest and fees shall accrue during each period
during which interest or such fees are computed from the first day thereof
to the last day thereof.
(b) Each determination of an interest rate by the Agent shall
be conclusive and binding on the Company and the Banks in the absence of
manifest error.
2.12 Payments by the Company.
(a) All payments to be made by the Company shall be made
without set-off, recoupment or counterclaim. Except as otherwise expressly
provided herein, all payments by the Company shall be made to the Agent for
the account of the Banks at the Agent's Payment Office, and shall be made in
dollars and in immediately available funds, no later than 11:00 a.m. (San
Francisco time) on the date specified herein. The Agent will promptly
distribute to each Bank its Pro Rata Share (or other applicable share as
expressly provided herein) of such payment in like funds as received. Any
payment received by the Agent later than 11:00 a.m. (San Francisco time)
shall be deemed to have been received on the following Business Day and any
applicable interest or fee shall continue to accrue.
(b) Subject to the provisions set forth in the definition of
"Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and
such extension of time shall in such case be included in the computation of
interest or fees, as the case may be.
(c) Unless the Agent receives notice from the Company prior to
the date on which any payment is due to the Banks that the Company will not
make such payment in full as and when required, the Agent may assume that
the Company has made such payment in full to the Agent on such date in
immediately available funds and the Agent may (but shall not be so
required), in reliance upon such assumption, distribute to each Bank on such
due date an amount equal to the amount then due such Bank. If and to the
extent the Company has not made such payment in full to the Agent, each Bank
shall repay to the Agent on demand such amount distributed to such Bank,
together with interest thereon at the Federal Funds Rate for each day from
the date such amount is distributed to such Bank until the date repaid.
2.13 Payments by the Banks to the Agent.
(a) Unless the Agent receives notice from a Bank on or prior
to the Closing Date or, with respect to any Borrowing after the Closing
Date, at least one Business Day prior to the date of such Borrowing, that
such Bank will not make available as and when required hereunder to the
Agent for the account of the Company the amount of that Bank's Pro Rata
Share of the Borrowing, the Agent may assume that each Bank has made such
amount available to the Agent in immediately available funds on the
Borrowing Date and the Agent may (but shall not be so required), in reliance
upon such assumption, make available to the Company on such date a
corresponding amount. If and to the extent any Bank shall not have made its
full amount available to the Agent in immediately available funds and the
Agent in such circumstances has made available to the Company such amount,
that Bank shall on the Business Day following such Borrowing Date make such
amount available to the Agent, together with interest at the Federal Funds
Rate for each day during such period. A notice of the Agent submitted to
any Bank with respect to amounts owing under this subsection (a) shall be
conclusive, absent manifest error. If such amount is so made available,
such payment to the Agent shall constitute such Bank's Loan on the date of
Borrowing for all purposes of this Agreement. If such amount is not made
available to the Agent on the Business Day following the Borrowing Date, the
Agent will notify the Company of such failure to fund and, upon demand by
the Agent, the Company shall pay such amount to the Agent for the Agent's
account, together with interest thereon for each day elapsed since the date
of such Borrowing, at a rate per annum equal to the interest rate applicable
at the time to the Loans comprising such Borrowing.
(b) The failure of any Bank to make any Loan on any Borrowing
Date shall not relieve any other Bank of any obligation hereunder to make a
Loan on such Borrowing Date, but no Bank shall be responsible for the
failure of any other Bank to make the Loan to be made by such other Bank on
any Borrowing Date.
2.14 Sharing of Payments, Etc.
If, other than as expressly provided elsewhere herein, any Bank
shall obtain on account of the Loans made by it any payment (whether
voluntary, involuntary, through the exercise of any right of set-off, or
otherwise) in excess of its ratable share (or other share contemplated
hereunder), such Bank shall immediately (a) notify the Agent of such fact,
and (b) purchase from the other Banks such participations in the Loans made
by them as shall be necessary to cause such purchasing Bank to share the
excess payment pro rata with each of them; provided, however, that if all or
any portion of such excess payment is thereafter recovered from the
purchasing Bank, such purchase shall to that extent be rescinded and each
other Bank shall repay to the purchasing Bank the purchase price paid
therefor, together with an amount equal to such paying Bank's ratable share
(according to the proportion of (i) the amount of such paying Bank's
required repayment to (ii) the total amount so recovered from the purchasing
Bank) of any interest or other amount paid or payable by the purchasing Bank
in respect of the total amount so recovered. The Company agrees that any
Bank so purchasing a participation from another Bank may, to the fullest
extent permitted by law, exercise all its rights of payment (including the
right of set-off, but subject to Section 11.10) with respect to such
participation as fully as if such Bank were the direct creditor of the
Company in the amount of such participation. The Agent will keep records
(which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the
Banks following any such purchases or repayments.
2.15 Quarterly Adjustments.
If the Company shall have failed to deliver the financial
reports pursuant to Section 7.1 and the certificates pursuant to Section 7.2
on a timely basis and if, when delivered with respect to any fiscal quarter,
such financial reports and certificates indicate that the Applicable Margin
or the Facility Fee Percentage for any period after such failure should have
been higher than the Applicable Margin or the Facility Fee Percentage
assumed after such period pursuant to the definitions of such terms by
virtue of such failure, and the interest or fee that would have been
collected hereunder based upon the actual Applicable Margin or the Facility
Fee Percentage had such failure not occurred exceeds the interest or fee
actually collected hereunder, then the Company shall pay an amount equal to
such excess on the next Interest Payment Date.
2.16 Extension of Facility A Revolving Termination Date.
At least 45 and no earlier than 90 days before the Facility A
Revolving Termination Date then in effect, the Company may request, through
the Agent, that each Bank extend the Facility A Revolving Termination Date,
effective upon the day following the Facility A Revolving Termination Date
then in effect, to a date that is 364 days following the Facility A Revolving
Termination Date then in effect. Each Bank that elects to extend the Facility
A Revolving Termination Date will so indicate by notifying the Agent and the
Company in writing during the period between 45 and 30 days before the
Facility A Revolving Termination Date then in effect. If less than all of the
Banks elect to extend the Termination Date during the aforesaid period, the
Company may (but shall not be obligated to) invoke the provisions of
Section 4.7 to substitute, effective following the Facility A Revolving
Termination Date then in effect, for the Commitments and Loans of any Bank
that has not elected to extend the Facility A Revolving Termination Date.
Unless a Default or Event of Default exists, the Facility A Revolving
Termination Date will be extended as aforesaid if, on or before the Facility A
Revolving Termination Date then in effect, after taking into account any
substitution in accordance with Section 4.7, Banks with aggregate Commitments
equal to 66-2/3% of the aggregate Facility A Commitments have agreed to the
extension of the Facility A Revolving Termination Date as aforesaid. If the
Facility A Revolving Termination Date shall be so extended, any Bank not
electing to extend shall cease to be a party to this Agreement effective upon
its replacement under Section 4.7, and, if such Bank's Loans have been
assigned to a Replacement Bank in accordance with Section 4.7, such Bank shall
have no continuing rights or obligations hereunder except under those sections
that are expressly to survive termination of the Commitments and repayment of
the Loans. If such Bank's Loans have not been so assigned, such Loans,
together with interest thereon and Facility Fees owing to such Bank on account
of its Facility A Commitment, shall be due and payable in full on the
previously effective Facility A Revolving Termination Date with no further
action by any party hereto. Notwithstanding anything in this Section 2.16,
the Facility A Revolving Termination Date shall not be extended more than two
(2) times.
ARTICLE III.
THE LETTERS OF CREDIT
3.1 The Letter of Credit Subfacilities.
(a) On the terms and conditions set forth herein (i) the
Issuing Bank agrees, (A) from time to time on any Business Day during the
period from the Closing Date to the Facility A Revolving Termination Date to
issue Letters of Credit for the account of the Company, and to amend or
renew Letters of Credit previously issued by it, in accordance with
subsections 3.2(c) and 3.2(d), and (B) to honor drafts under the Letters of
Credit; and (ii) the Banks severally agree to participate in Letters of
Credit Issued for the account of the Company; provided, that the Issuing
Bank shall not be obligated to Issue, and no Bank shall be obligated to
participate in, any Letter of Credit if as of the date of Issuance of such
Letter of Credit (the "Issuance Date") (1) the Effective Amount of all L/C
Obligations plus the Effective Amount of all Facility A Revolving Loans
exceeds the combined Facility A Commitments, (2) the participation of any
Bank in the Effective Amount of all L/C Obligations plus the Effective
Amount of the Facility A Revolving Loans of such Bank exceeds such Bank's
Facility A Commitment, (3) the Effective Amount of Commercial Letters of
Credit exceeds the Commercial L/C Commitment, or (4) the Effective Amount of
Standby Letters of Credit exceeds the Standby L/C Commitment. Within the
foregoing limits, and subject to the other terms and conditions hereof, the
Company's ability to obtain Letters of Credit shall be fully revolving, and,
accordingly, the Company may, during the foregoing period, obtain Letters of
Credit to replace Letters of Credit which have expired or which have been
drawn upon and reimbursed.
(b) The Issuing Bank is under no obligation to Issue any
Letter of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain the
Issuing Bank from Issuing such Letter of Credit, or any Requirement of Law
applicable to the Issuing Bank or any request or directive (whether or not
having the force of law) from any Governmental Authority with jurisdiction
over the Issuing Bank shall prohibit, or request that the Issuing Bank
refrain from, the Issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the Issuing Bank with respect to
such Letter of Credit any restriction, reserve or capital requirement (for
which the Issuing Bank is not otherwise compensated hereunder) not in effect
on the Closing Date, or shall impose upon the Issuing Bank any unreimbursed
loss, cost or expense which was not applicable on the Closing Date and which
the Issuing Bank in good ▇▇▇▇▇ ▇▇▇▇▇ material to it;
(ii) the Issuing Bank has received written notice from
any Bank, the Agent or the Company, on or prior to the Business Day prior to
the requested date of Issuance of such Letter of Credit, that one or more of
the applicable conditions contained in Article V is not then satisfied;
(iii) the expiration date of any requested Letter of
Credit is (A) (i) more than six months after the date of Issuance, in the
case of Commercial Letters of Credit, or (ii) more than one year after the
date of Issuance, in the case of Standby Letters of Credit, unless the
Required Banks have approved such expiration date in writing, or (B) after
the Facility B Revolving Termination Date, unless all of the Banks have
approved such expiration date in writing;
(iv) the expiration date of any requested Standby Letter
of Credit is prior to the maturity date of any financial obligation to be
supported by the requested Standby Letter of Credit;
(v) any requested Letter of Credit does not provide for
drafts, or is not otherwise in form and substance acceptable to the Issuing
Bank, or the Issuance of a Letter of Credit shall violate any applicable
policies of the Issuing Bank;
(vi) any Standby Letter of Credit is for the purpose of
supporting the issuance of any letter of credit by any other Person; or
(vii) such Letter of Credit is in a face amount less than
$50,000 if a Standby Letter of Credit or is denominated in a currency other
than Dollars;
3.2 Issuance, Amendment and Renewal of Letters of Credit.
(a) Each Standby Letter of Credit shall be issued upon the
written request of the Company received by the Issuing Bank (with a copy
sent by the Company to the Agent) at least four days (or such shorter time
as the Issuing Bank may agree in a particular instance in its sole
discretion) prior to the proposed date of issuance. Each such request for
issuance of a Standby Letter of Credit shall be by facsimile, confirmed
immediately in an original writing, in the form of an L/C Application, and
shall specify in form and detail reasonably satisfactory to the Issuing
Bank: (i) the proposed date of issuance of the Standby Letter of Credit
(which shall be a Business Day); (ii) the face amount of the Standby Letter
of Credit; (iii) the expiration date of the Standby Letter of Credit; (iv)
the name and address of the beneficiary thereof; (v) the documents to be
presented by the beneficiary of the Standby Letter of Credit in case of any
drawing thereunder; (vi) the full text of any certificate to be presented by
the beneficiary in case of any drawing thereunder; and (vii) such other
matters as the Issuing Bank may reasonably require.
(b) Each Commercial Letter of Credit shall be issued in
accordance with the Issuing Bank's usual and customary business and
documentation practices, as mutually agreed by the Company and the Issuing
Bank.
(c) At least two Business Days prior to the Issuance of any
Standby Letter of Credit, the Issuing Bank will confirm with the Agent (by
telephone or in writing) that the Agent has received a copy of the L/C
Application or L/C Amendment Application from the Company and, if not, the
Issuing Bank will provide the Agent with a copy thereof. Unless the Issuing
Bank has received notice on or before the Business Day immediately preceding
the date the Issuing Bank is to issue a requested Standby Letter of Credit
from the Agent (A) directing the Issuing Bank not to issue such Standby
Letter of Credit because such issuance is not then permitted under
subsection 3.1(a) as a result of the limitations set forth in clauses (1)
through (3) thereof or subsection 3.1(b)(ii); or (B) that one or more
conditions specified in Article V are not then satisfied; then, subject to
the terms and conditions hereof, the Issuing Bank shall, on the requested
date, issue a Standby Letter of Credit for the account of the Company in
accordance with the Issuing Bank's usual and customary business practices.
(d) From time to time while a Standby Letter of Credit is
outstanding and prior to the Facility A Revolving Termination Date, the
Issuing Bank will, upon the written request of the Company received by the
Issuing Bank (with a copy sent by the Company to the Agent) at least five
days (or such shorter time as the Issuing Bank may agree in a particular
instance in its sole discretion) prior to the proposed date of amendment,
amend any Standby Letter of Credit issued by it. Each such request for
amendment of a Standby Letter of Credit shall be made by facsimile,
confirmed immediately in an original writing, made in the form of an L/C
Amendment Application and shall specify in form and detail satisfactory to
the Issuing Bank: (i) the Standby Letter of Credit to be amended; (ii) the
proposed date of amendment of the Standby Letter of Credit (which shall be a
Business Day); (iii) the nature of the proposed amendment; and (iv) such
other matters as the Issuing Bank may reasonably require. The Issuing Bank
shall be under no obligation to amend any Standby Letter of Credit if: (A)
the Issuing Bank would have no obligation at such time to issue such Standby
Letter of Credit in its amended form under the terms of this Agreement; or
(B) the beneficiary of any such Standby Letter of Credit does not accept the
proposed amendment to the Standby Letter of Credit. The Agent will promptly
notify the Banks of the receipt by it of any L/C Application or L/C
Amendment Application.
(e) The Issuing Bank and the Banks agree that, while a Standby
Letter of Credit is outstanding and prior to the Facility A Revolving
Termination Date, at the option of the Company and upon the written request
of the Company received by the Issuing Bank (with a copy sent by the Company
to the Agent) at least five days (or such shorter time as the Issuing Bank
may agree in a particular instance in its sole discretion) prior to the
proposed date of notification of renewal, the Issuing Bank shall be entitled
to take or omit to take such action as would allow the renewal of any
Standby Letter of Credit issued by it. Each such request for renewal of a
Standby Letter of Credit shall be made by facsimile, confirmed immediately
in an original writing, in the form of an L/C Amendment Application, and
shall specify in form and detail satisfactory to the Issuing Bank: (i) the
Standby Letter of Credit to be renewed; (ii) the proposed date of
notification of renewal of the Standby Letter of Credit (which shall be a
Business Day); (iii) the revised expiration date of the Standby Letter of
Credit; and (iv) such other matters as the Issuing Bank may reasonably
require. The Issuing Bank shall be under no obligation so to renew any
Standby Letter of Credit if: (A) the Issuing Bank would have no obligation
at such time to issue or amend such Standby Letter of Credit in its renewed
form under the terms of this Agreement; or (B) the beneficiary of any such
Standby Letter of Credit does not accept the proposed renewal of the Standby
Letter of Credit. If any outstanding Standby Letter of Credit shall provide
that it shall be automatically renewed unless the beneficiary thereof
receives notice from the Issuing Bank that such Standby Letter of Credit
shall not be renewed, and if at the time of renewal the Issuing Bank would
be entitled to authorize the automatic renewal of such Standby Letter of
Credit in accordance with this subsection 3.2(e) upon the request of the
Company but the Issuing Bank shall not have received any L/C Amendment
Application from the Company with respect to such renewal or other written
direction by the Company with respect thereto, the Issuing Bank shall
nonetheless be permitted to allow such Standby Letter of Credit to renew,
and the Company and the Banks hereby authorize such renewal, and,
accordingly, the Issuing Bank shall be deemed to have received an L/C
Amendment Application from the Company requesting such renewal.
(f) The Issuing Bank may, at its election (or as required by
the Agent at the direction of the Required Banks), deliver any notices of
termination or other communications to any Letter of Credit beneficiary or
transferee, and take any other action as necessary or appropriate, at any
time and from time to time, in order to cause the expiration date of such
Letter of Credit to be a date not later than the Facility B Revolving
Termination Date.
(g) This Agreement shall control in the event of any conflict
with any L/C-Related Document (other than any Letter of Credit).
(h) The Issuing Bank will also deliver to the Agent,
concurrently or promptly following its delivery of a Letter of Credit, or
amendment to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or
amendment to or renewal of a Letter of Credit.
3.3 Risk Participations, Drawings and Reimbursements.
(a) Immediately upon the Issuance of each Letter of Credit in
addition to those described in subsection 3.3(a), each Bank shall be deemed
to, and hereby irrevocably and unconditionally agrees to, purchase from the
Issuing Bank a participation in such Letter of Credit and each drawing
thereunder in an amount equal to the product of (i) the Pro Rata Share of
such Bank, times (ii) the maximum amount available to be drawn under such
Letter of Credit and the amount of such drawing, respectively. For purposes
of subsection 2.1(a), each Issuance of a Letter of Credit shall be deemed to
utilize the Standby L/C Commitment or Commercial L/C Commitment, as
applicable, of each Bank by an amount equal to the amount of such
participation.
(b) In the event of any request for a drawing under a Letter
of Credit by the beneficiary or transferee thereof, the Issuing Bank will
promptly notify the Company. In the case of Commercial Letters of Credit,
such notice will be provided at least one Business Day before the date that
any amount is paid by the Issuing Bank under any Letter of Credit (each such
date, an "Honor Date"); in the case of Standby Letters of Credit, the
Issuing Bank will endeavor to notify the Company at least one Business Day
before the Honor Date but its failure to provide such notice shall neither
give rise to liability against it nor be any defense to the reimbursement
obligations of the Company as described in the next sentence. The Company
shall reimburse the Issuing Bank prior to 10:00 a.m. (San Francisco time) on
each Honor Date in an amount equal to the amount so paid by the Issuing
Bank. In the event the Company fails to reimburse the Issuing Bank for the
full amount of any drawing under any Letter of Credit by 10:00 a.m. (San
Francisco time) on the Honor Date, the Issuing Bank will promptly notify the
Agent and the Agent will promptly notify each Bank thereof, and the Company
shall be deemed to have requested that Base Rate Loans be made by the Banks
to be disbursed on the Honor Date under such Letter of Credit, subject to
the amount of the unutilized portion of the Facility A Revolving Commitment
and subject to the conditions set forth in Section 5.3. Any notice given by
the Issuing Bank or the Agent pursuant to this subsection 3.3(b) may be oral
if immediately confirmed in writing (including by facsimile); provided that
the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(c) Each Bank shall upon any notice pursuant to
subsection 3.3(b) make available to the Agent for the account of the
relevant Issuing Bank an amount in Dollars and in immediately available
funds equal to its Pro Rata Share of the amount of the drawing, whereupon
the participating Banks shall (subject to subsection 3.3(e)) each be deemed
to have made a Facility A Revolving Loan consisting of a Base Rate Loan to
the Company in that amount. If any Bank so notified fails to make available
to the Agent for the account of the Issuing Bank the amount of such Bank's
Pro Rata Share of the amount of the drawing by no later than 12:00 noon (San
Francisco time) on the Honor Date, then interest shall accrue on such Bank's
obligation to make such payment, from the Honor Date to the date such Bank
makes such payment, at a rate per annum equal to the Federal Funds Rate in
effect from time to time during such period. The Agent will promptly give
notice of the occurrence of the Honor Date, but failure of the Agent to give
any such notice on the Honor Date or in sufficient time to enable any Bank
to effect such payment on such date shall not relieve such Bank from its
obligations under this Section 3.3.
(d) With respect to any unreimbursed drawing that is not
converted into Facility A Revolving Loans consisting of Base Rate Loans to
the Company in whole or in part, because of the Company's failure to satisfy
the conditions set forth in Section 5.3 or for any other reason, the Company
shall be deemed to have incurred from the Issuing Bank an L/C Borrowing in
the amount of such drawing, which L/C Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at a rate per annum
equal to the Base Rate plus 2% per annum, and each Bank's payment to the
Issuing Bank pursuant to this subsection 3.3(d) shall be deemed payment in
respect of its participation in such L/C Borrowing and shall constitute an
L/C Advance from such Bank in satisfaction of its participation obligation
under this Section 3.3.
(e) Each Bank's obligation in accordance with this Agreement
to make the Facility A Revolving Loans or L/C Advances, as contemplated by
this Section 3.3, as a result of a drawing under a Letter of Credit, shall
be absolute and unconditional and without recourse to the Issuing Bank and
shall not be affected by any circumstance, including (i) any set-off,
counterclaim, recoupment, defense or other right which such Bank may have
against the Issuing Bank, the Company or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of a Default, an Event of
Default or a Material Adverse Effect; or (iii) any other circumstance,
happening or event whatsoever, whether or not similar to any of the
foregoing; provided, however, that each Bank's obligation to make Facility A
Revolving Loans under this Section 3.3 is subject to the conditions set
forth in Section 5.3.
3.4 Repayment of Participations.
(a) Upon (and only upon) receipt by the Agent for the account
of the Issuing Bank of immediately available funds from the Company (i) in
reimbursement of any payment made by the Issuing Bank under the Letter of
Credit with respect to which any Bank has paid the Agent for the account of
the Issuing Bank for such Bank's participation in the Letter of Credit
pursuant to Section 3.3 or (ii) in payment of interest thereon, the Agent
will pay to each Bank, in the same funds as those received by the Agent for
the account of the Issuing Bank, the amount of such Bank's Pro Rata Share of
such funds, and the Issuing Bank shall receive the amount of the Pro Rata
Share of such funds of any Bank that did not so pay the Agent for the
account of the Issuing Bank.
(b) If the Agent or the Issuing Bank is required at any time
to return to the Company, or to a trustee, receiver, liquidator, custodian,
or any official in any Insolvency Proceeding, any portion of the payments
made by the Company to the Agent for the account of the Issuing Bank
pursuant to subsection 3.4(a) in reimbursement of a payment made under the
Letter of Credit or interest or fee thereon, each Bank shall, on demand of
the Agent, forthwith return to the Agent or the Issuing Bank the amount of
its Pro Rata Share of any amounts so returned by the Agent or the Issuing
Bank plus interest thereon from the date such demand is made to the date
such amounts are returned by such Bank to the Agent or the Issuing Bank, at
a rate per annum equal to the Federal Funds Rate in effect from time to
time.
3.5 Role of the Issuing Bank.
(a) Each Bank and the Company agree that, in paying any
drawing under a Letter of Credit, the Issuing Bank shall not have any
responsibility to obtain any document (other than any sight draft and
certificates expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority
of the Person executing or delivering any such document.
(b) No Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Bank shall be
liable to any Bank for: (i) any action taken or omitted in connection
herewith at the request or with the approval of the Banks (including the
Required Banks, as applicable); (ii) any action taken or omitted in the
absence of gross negligence or willful misconduct; or (iii) the due
execution, effectiveness, validity or enforceability of any L/C-Related
Document.
(c) The Company hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; provided, however, that this assumption is not intended
to, and shall not, preclude the Company's pursuing such rights and remedies
as it may have against the beneficiary or transferee at law or under any
other agreement. No Agent-Related Person, nor any of the respective
correspondents, participants or assignees of the Issuing Bank, shall be
liable or responsible for any of the matters described in clauses (i)
through (vii) of Section 3.6; provided, however, anything in such clauses to
the contrary notwithstanding, that the Company may have a claim against the
Issuing Bank, and the Issuing Bank may be liable to the Company, to the
extent, but only to the extent, of any direct, as opposed to consequential
or exemplary, damages suffered by the Company which the Company proves were
caused by the Issuing Bank's willful misconduct or gross negligence or the
Issuing Bank's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing: (i) the Issuing Bank may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary; and (ii) the Issuing Bank shall not be
responsible for the validity or sufficiency of any instrument transferring
or assigning or purporting to transfer or assign a Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in part,
which may prove to be invalid or ineffective for any reason.
3.6 Obligations Absolute
The obligations of the Company under this Agreement and any L/C-
Related Document to reimburse the Issuing Bank for a drawing under a Letter
of Credit, and to repay any L/C Borrowing and any drawing under a Letter of
Credit converted into Facility A Revolving Loans, shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement and each such other L/C-Related Document under all circumstances,
including the following:
(i) any lack of validity or enforceability of this
Agreement or any L/C-Related Document;
(ii) any change in the time, manner or place of payment
of, or in any other term of, all or any of the obligations of the Company in
respect of any Letter of Credit or any other amendment or waiver of or any
consent to departure from all or any of the L/C-Related Documents;
(iii) the existence of any claim, set-off, defense or
other right that the Company may have at any time against any beneficiary or
any transferee of any Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank or any
other Person, whether in connection with this Agreement, the transactions
contemplated hereby or by the L/C-Related Documents or any unrelated
transaction;
(iv) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being untrue
or inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any
Letter of Credit;
(v) any payment by the Issuing Bank under any Letter of
Credit against presentation of a draft or certificate that does not strictly
comply with the terms of any Letter of Credit; or any payment made by the
Issuing Bank under any Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to
any beneficiary or any transferee of any Letter of Credit, including any
arising in connection with any Insolvency Proceeding;
(vi) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any other guarantee, for all or any of the obligations of the Company
in respect of any Letter of Credit; or
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Company or a guarantor.
3.7 Cash Collateral Pledge.
Upon (i) the request of the Agent, (A) if the Issuing Bank has
honored any full or partial drawing request on any Letter of Credit and such
drawing has resulted in an L/C Borrowing hereunder, or (B) if, as of the
Facility B Revolving Termination Date, any Letters of Credit may for any
reason remain outstanding and partially or wholly undrawn, or (ii) the
occurrence of the circumstances described in Section 2.7 requiring the
Company to Cash Collateralize Letters of Credit, then, the Company shall
immediately Cash Collateralize the L/C Obligations in an amount equal to
such L/C Obligations.
3.8 Letter of Credit Fees.
(a) The Company shall pay to the Agent for the account of each
of the Banks a letter of credit fee with respect to Standby Letters of
Credit equal to the L/C Fee Percentage of the average daily maximum amount
available to be drawn of the outstanding Standby Letters of Credit, computed
on a quarterly basis in arrears on the last Business Day of each calendar
quarter based upon Standby Letters of Credit outstanding for that quarter as
calculated by the Agent. Such letter of credit fees shall be due and
payable quarterly in arrears on the last Business Day of each calendar
quarter during which Letters of Credit are outstanding, commencing on the
first such quarterly date to occur after the Closing Date, through the
Facility A Revolving Termination Date (or such later date upon which the
outstanding Standby Letters of Credit shall expire), with the final payment
to be made on the Facility A Revolving Termination Date (or such later
expiration date).
(b) The Company shall pay to the Issuing Bank for its own
account a letter of credit fronting fee for each Standby Letter of Credit
Issued by the Issuing Bank, computed for the period between the date of
Issuance of such Standby Letter of Credit to the expiration date thereof, in
an amount equal to 0.125% per annum of the face amount of such Standby
Letter of Credit. Such Standby Letter of Credit fronting fee shall be due
and payable on each date of Issuance of a Standby Letter of Credit, and
shall be fully earned upon the submission of a request for a Letter of
Credit, regardless of whether such request is later revoked or withdrawn.
(c) With respect to Standby Letters of Credit, the Company
shall pay to the Issuing Bank from time to time on demand the normal
issuance, presentation, amendment and other processing fees, and other
standard costs and charges of the Issuing Bank relating to standby letters
of credit as from time to time in effect. With respect to Commercial
Letters of Credit, the Company shall pay to the Issuing Bank from time to
time on demand such presentation, amendment and other processing fees, and
other standard costs and charges of the Issuing Bank relating to commercial
letters of credit as the Company and the Issuing Bank may from time to time
agree.
3.9 Uniform Customs and Practice.
The Uniform Customs and Practice for Documentary Credits as
published by the International Chamber of Commerce most recently at the time
of issuance of any Letter of Credit shall (unless otherwise expressly
provided in the Letters of Credit) apply to the Letters of Credit.
3.10 Subsidiaries as Account Parties.
(a) As agreed from time to time between the Company and the
Issuing Bank, the L/C-Related Documents for any Letter of Credit, and other
communications required of the Company with respect thereto under this
Article III, may be executed by a Subsidiary of the Company (an "L/C
Subsidiary") rather than the Company. The parties hereto acknowledge and
agree that a letter of credit issued pursuant to such L/C-Related Documents
shall be a Letter of Credit for all purposes hereunder, and the Company, the
Issuing Bank, and the Banks shall be obligated with respect thereto
hereunder, and the Company shall be obligated under the related L/C-Related
Documents, as though the Company were the signatory to such L/C Related
Documents. Without limiting the foregoing, the Company hereby guarantees
the payment when due, upon maturity, acceleration or otherwise, of any and
all indebtedness of any L/C Subsidiary to the Issuing Bank, the Agent, or
any Bank arising under any L/C-Related Document. If any or all of such
indebtedness becomes due and payable , the Company unconditionally promise
to pay such indebtedness to Bank, or order, on demand, in lawful money of
the United States. The word "indebtedness" as used in this Section 3.10
shall mean any and all advances, debts, obligations and liabilities of an
L/C Subsidiary, or any one or more of them, heretofore, now, or hereafter
made, incurred or created, under any L/C-Related Document, and any and all
renewals, extensions or modifications thereof, whether or not recovery upon
such indebtedness may be or hereafter become barred by any statute of
limitations, and whether or not such indebtedness may be or hereafter become
otherwise unenforceable.
(b) The Company guarantees the payment of any and all
indebtedness of each L/C Subsidiary whether or not due or payable by such
L/C Subsidiary upon (a) the death, dissolution, insolvency or business
failure of, or any assignment for benefit of creditors by, or commencement
of any bankruptcy, reorganization, arrangement, moratorium or other debtor
relief proceedings by or against, such L/C Subsidiary or the Company, or
(b) the appointment of a receiver for, or the attachment, restraint of or
making or levying of any order of court or legal process affecting, the
property of such L/C Subsidiary or the Company, and unconditionally promises
to pay such indebtedness to the Agent, on demand, in lawful money of the
United States.
(c) The liability of the Company under this Section 3.10 is
exclusive and independent of any security for or other guaranty of the
indebtedness of any L/C Subsidiary, whether executed by the Company or by
any other party, and the liability of the Company hereunder is not affected
or impaired by (a) any direction of application of payment by any L/C
Subsidiary or by any other party, or (b) any other guaranty or undertaking
of the Company or of any other party as to the indebtedness of any L/C
Subsidiary, or (c) any payment on or in reduction of any such other guaranty
or undertaking, or (d) any dissolution, termination or increase, decrease or
change in personnel of any L/C Subsidiary or the Company. To the extent any
L/C Subsidiary or the Company make any payment to the Issuing Bank or the
Agent in connection with the indebtedness, and all or any part of such
payment is subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid or paid over to a trustee,
receiver or any other entity, whether in connection with an Insolvency
Proceeding or otherwise (any such payment is hereinafter referred to as a
"Preferential Payment"), then this guaranty shall continue to be effective
or shall be reinstated, as the case may be, and, to the extent of such
payment or repayment, the indebtedness or part thereof intended to be
satisfied by such Preferential Payment shall be revived and continued in
full force and effect as if said Preferential Payment had not been made.
(d) The obligations of the Company under this Section 3.10 are
independent of the obligations of the L/C Subsidiaries, and a separate
action or actions may be brought and prosecuted against the Company whether
or not action is brought against any L/C Subsidiary and whether or not any
L/C Subsidiary be joined in any such action or actions.
(e) The Company authorizes the Issuing Bank, without notice or
demand (except as shall be required by applicable statute and cannot be
waived), and without affecting or impairing their liability hereunder, from
time to time to (a) renew, compromise, extend, accelerate or otherwise
change the time for payment of, or otherwise change the terms of the
indebtedness or any part thereof, including increase or decrease of the rate
of interest thereon; (b) take and hold security for the payment of the
indebtedness and exchange, enforce, waive and release any such security;
(c) apply such security and direct the order or manner of sale thereof as
Issuing Bank in its discretion may determine; and (d) release or substitute
any one or more endorsers, guarantors, L/C Subsidiaries or other obligors.
(f) It is not necessary for the Issuing Bank to inquire into
the capacity or powers of any L/C Subsidiary or the officers, directors,
partners or agents acting or purporting to act on their behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder, and if any L/C Subsidiary is a
partnership, the word "L/C Subsidiary" and "indebtedness" as used herein
include all successor partnerships and liabilities thereof to Issuing Bank,
the Agent, and the Banks.
(g) Absent a waiver of such right, the Company may have the
right to assert a defense to an action to enforce this guaranty if (a) the
Issuing Bank, the Agent, or the Banks do not proceed against any L/C
Subsidiary, or any security for the indebtedness of any L/C Subsidiary, or
pursue any other remedy in their power that the Company cannot pursue,
before enforcing this guaranty, (b) the Issuing Bank, the Agent, or the
Banks takes any action, without the Company's consent, of the type specified
in subsection 3.10(c), or any other action by which the indebtedness of any
L/C Subsidiary is altered in any respect, or the remedies or rights of the
Company against any L/C Subsidiary or any other person or any security are
impaired, suspended or extinguished, (c) any L/C Subsidiary is under a legal
disability or any L/C Subsidiary has any other defense to payment of the
indebtedness, (d) there is no liability on the part of any L/C Subsidiary or
such liability is limited or ceases for any reason other than payment of the
indebtedness in full, (e) Issuing Bank, the Agent, or any Bank fails to
notify the Company of information known to them as to any L/C Subsidiary's
financial condition, assets or other circumstances bearing on repayment of
the indebtedness or the nature, scope and extent of the risks that the
Company assumes and incurs hereunder (and the Company agree that neither the
Issuing Bank, the Agent, nor any Bank shall have any duty to advise the
Company of any such information), (f) the statute of limitations applicable
to an action to enforce this guaranty has run (and the Company agrees that
any payment by any L/C Subsidiary or other circumstance that operates to
toll any statute of limitations as to any L/C Subsidiary shall operate to
toll the statute of limitations as to the Company), (g) the Issuing Bank,
the Agent, or any Bank fails to make or provide any presentment, demand for
performance, or notice of nonperformance, dishonor, the acceptance of this
guaranty, or other notice, or (h) any election of remedies by the Issuing
Bank, the Agent, or any Bank , including any election to proceed by
nonjudicial foreclosure on any security, or any act or omission of the
Issuing Bank, the Agent, or any Bank relating to such foreclosure, operates
to impair, suspend or extinguish any right of contribution, subrogation or
reimbursement that the Company would otherwise have against any L/C
Subsidiary. THE COMPANY HEREBY EXPRESSLY WAIVES THE RIGHT TO ASSERT ANY
DEFENSE DESCRIBED IN THIS SUBSECTION 3.10(G).
3.11 Issuing Affiliate.
The Issuing Bank may perform any or all of its obligations under
this Agreement with respect to commercial Letters of Credit through one or
more of its Affiliates (each, an "Issuing Affiliate") and, if it exercises
such option, each reference to "Issuing Bank" in this Agreement shall be
deemed a reference to the Issuing Bank or its Issuing Affiliate, as
appropriate; provided, however, that any Letter of Credit issued by the
Issuing Affiliate will, upon the request of the Company, be confirmed by
Bank of America.
ARTICLE IV.
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes.
(a) Except as otherwise required by law, any and all payments
by the Company to each Bank or the Agent under this Agreement and any other
Loan Document shall be made free and clear of, and without deduction or
withholding for, any Taxes. In addition, the Company shall pay all Other
Taxes.
(b) If the Company shall be required by law to deduct or
withhold any Taxes, Other Taxes or Further Taxes from or in respect of any
sum payable hereunder to any Bank or the Agent, then:
(i) the sum payable shall be increased as necessary so
that, after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under this
Section), such Bank or the Agent, as the case may be, receives and retains
an amount equal to the sum it would have received and retained had no such
deductions or withholdings been made;
(ii) the Company shall make such deductions and
withholdings;
(iii) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in accordance
with applicable law; and
(iv) the Company shall also pay to each Bank or the Agent
for the account of such Bank, at the time interest is paid, Further Taxes in
the amount that the respective Bank specifies as necessary to preserve the
after-tax yield the Bank would have received if such Taxes, Other Taxes or
Further Taxes had not been imposed.
(c) The Company agrees to indemnify and hold harmless each
Bank and the Agent for the full amount of (i) Taxes, (ii) Other Taxes, and
(iii) Further Taxes in the amount that the respective Bank specifies as
necessary to preserve the after-tax yield the Bank would have received if
such Taxes, Other Taxes or Further Taxes had not been imposed, and any
liability (including penalties, interest, additions to tax and expenses)
arising therefrom or with respect thereto, whether or not such Taxes, Other
Taxes or Further Taxes were correctly or legally asserted. Payment under
this indemnification shall be made within 30 days after the date the Bank or
the Agent makes written demand therefor.
(d) Within 30 days after the date of any payment by the
Company of Taxes, Other Taxes or Further Taxes, the Company shall furnish to
each Bank or the Agent the original or a certified copy of a receipt
evidencing payment thereof, or other evidence of payment satisfactory to
such Bank or the Agent.
(e) If the Company is required to pay any amount to any Bank
or the Agent pursuant to subsection (b) or (c) of this Section, then such
Bank shall use reasonable efforts (consistent with legal and regulatory
restrictions) to change the jurisdiction of its Lending Office so as to
eliminate any such additional payment by the Company which may thereafter
accrue, if such change in the sole judgment of such Bank is not otherwise
disadvantageous to such Bank.
4.2 Illegality.
(a) If any Bank determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has
asserted that it is unlawful, for any Bank or its applicable Lending Office
to make Offshore Rate Loans, then, on notice thereof by the Bank to the
Company through the Agent, any obligation of that Bank to make Offshore Rate
Loans shall be suspended until the Bank notifies the Agent and the Company
that the circumstances giving rise to such determination no longer exist.
(b) If a Bank determines that it is unlawful to maintain any
Offshore Rate Loan, the Company shall, upon its receipt of notice of such
fact and demand from such Bank (with a copy to the Agent), prepay in full
such Offshore Rate Loans of that Bank then outstanding, together with
interest accrued thereon and amounts required under Section 4.4, either on
the last day of the Interest Period thereof, if the Bank may lawfully
continue to maintain such Offshore Rate Loans to such day, or immediately,
if the Bank may not lawfully continue to maintain such Offshore Rate Loan.
If the Company is required to so prepay any Offshore Rate Loan, then
concurrently with such prepayment, the Company shall borrow from the
affected Bank, in the amount of such repayment, a Base Rate Loan.
(c) If the obligation of any Bank to make or maintain Offshore
Rate Loans has been so terminated or suspended, the Company may elect, by
giving notice to the Bank through the Agent, that all Loans which would
otherwise be made by the Bank as Offshore Rate Loans shall be instead Base
Rate Loans.
(d) Before giving any notice to the Agent under this Section,
the affected Bank shall designate a different Lending Office with respect to
its Offshore Rate Loans if such designation will avoid the need for giving
such notice or making such demand and will not, in the judgment of the Bank,
be illegal or otherwise disadvantageous to the Bank.
4.3 Increased Costs and Reduction of Return.
(a) If any Bank determines that, due to either (i) the
introduction of or any change (other than any change by way of imposition of
or increase in reserve requirements included in the calculation of the
Offshore Rate or in respect of the assessment rate payable by any Bank to
the FDIC for insuring U.S. deposits) in or in the interpretation of any law
or regulation or (ii) the compliance by that Bank with any guideline or
request from any central bank or other Governmental Authority (whether or
not having the force of law), there shall be any increase in the cost to
such Bank of agreeing to make or making, funding or maintaining any Offshore
Rate Loans or participating in Letters of Credit, or, in the case of the
Issuing Bank, any increase in the cost to the Issuing Bank of agreeing to
issue, issuing or maintaining any Letter of Credit or of agreeing to make or
making, funding or maintaining any unpaid drawing under any Letter of
Credit, then the Company shall be liable for, and shall from time to time,
upon demand (with a copy of such demand to be sent to the Agent), pay to the
Agent for the account of such Bank, additional amounts as are sufficient to
compensate such Bank for such increased costs.
(b) If any Bank shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any
Capital Adequacy Regulation, (iii) any change in the interpretation or
administration of any Capital Adequacy Regulation by any central bank or
other Governmental Authority charged with the interpretation or
administration thereof, or (iv) compliance by the Bank (or its Lending
Office) or any corporation controlling the Bank with any Capital Adequacy
Regulation, affects or would affect the amount of capital required or
expected to be maintained by the Bank or any corporation controlling the
Bank and (taking into consideration such Bank's or such corporation's
policies with respect to capital adequacy and such Bank's desired return on
capital) determines that the amount of such capital is increased as a
consequence of its Commitment, loans, credits or obligations under this
Agreement, then, upon demand of such Bank to the Company through the Agent,
the Company shall pay to the Bank, from time to time as specified by the
Bank, additional amounts sufficient to compensate the Bank for such
increase.
4.4 Funding Losses.
The Company shall reimburse each Bank and hold each Bank
harmless from any loss or expense which the Bank may sustain or incur as a
consequence of:
(a) the failure of the Company to make on a timely basis any
payment of principal of any Offshore Rate Loan;
(b) the failure of the Company to borrow, continue or convert
a Loan after the Company has given (or is deemed to have given) a Notice of
Borrowing or a Notice of Conversion/ Continuation;
(c) the failure of the Company to make any prepayment in
accordance with any notice delivered under Section 2.6;
(d) the prepayment (including pursuant to Section 2.7) or
other payment (including after acceleration thereof) of an Offshore Rate
Loan on a day that is not the last day of the relevant Interest Period; or
(e) the automatic conversion under Section 2.4 of any Offshore
Rate Loan to a Base Rate Loan on a day that is not the last day of the
relevant Interest Period;
including any such loss or expense arising from the liquidation or
reemployment of funds obtained by it to maintain its Offshore Rate Loans or
from fees payable to terminate the deposits from which such funds were
obtained. For purposes of calculating amounts payable by the Company to the
Banks under this Section and under subsection 4.3(a), each Offshore Rate
Loan made by a Bank (and each related reserve, special deposit or similar
requirement) shall be conclusively deemed to have been funded at the LIBOR
used in determining the Offshore Rate for such Offshore Rate Loan by a
matching deposit or other borrowing in the interbank eurodollar market for a
comparable amount and for a comparable period, whether or not such Offshore
Rate Loan is in fact so funded.
4.5 Inability to Determine Rates.
If the Required Banks determine that for any reason adequate and
reasonable means do not exist for determining the Offshore Rate for any
requested Interest Period with respect to a proposed Offshore Rate Loan, or
that the Offshore Rate applicable pursuant to subsection 2.9(a) for any
requested Interest Period with respect to a proposed Offshore Rate Loan does
not adequately and fairly reflect the cost to such Banks of funding such
Loan, the Agent will promptly so notify the Company and each Bank.
Thereafter, the obligation of the Banks to make or maintain Offshore Rate
Loans hereunder shall be suspended until the Agent upon the instruction of
the Required Banks revokes such notice in writing. Upon receipt of such
notice, the Company may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If the Company does not
revoke such Notice, the Banks shall make, convert or continue the Loans, as
proposed by the Company, in the amount specified in the applicable notice
submitted by the Company, but such Loans shall be made, converted or
continued as Base Rate Loans instead of Offshore Rate Loans.
4.6 Certificates of Banks.
Any Bank claiming reimbursement or compensation under this
Article IV shall deliver to the Company (with a copy to the Agent) a
certificate setting forth in reasonable detail the amount payable to the
Bank hereunder and the calculations with respect thereto and such
certificate shall be conclusive and binding on the Company in the absence of
manifest error.
4.7 Substitution of Banks.
Upon (a) the receipt by the Company from any Bank of a claim for
compensation under Section 4.3, or (b) a Bank's failure to elect to extend
the Facility A Revolving Termination Date on or before the 30th day before
such date (a Bank described in clauses (a) or (b) being referred to as an
"Affected Bank"), then the Company may: (i) in the case of clause (a) above
only, request the Affected Bank to use its best efforts to obtain a
replacement bank or financial institution (which in any event, shall be an
Eligible Assignee) satisfactory to the Company to acquire and assume all or
a ratable part of all of such Affected Bank's Loans and Commitment (a
"Replacement Bank") in accordance with the assignment provisions contained
in Section 11.8; (ii) request one more of the other Banks to acquire and
assume all or part of such Affected Bank's Loans and Commitment in
accordance with the assignment provisions contained in Section 11.8; or
(iii) designate a Replacement Bank. Any such designation of a Replacement
Bank under clause (i) or (iii) shall be subject to the prior written consent
of the Agent (which consent shall not be unreasonably withheld) and shall be
effected in accordance with the assignment provisions contained in Section
11.8. The Company shall be liable for the payment upon demand of all costs
and other amounts arising under Section 4.4 that result from any Replacement
Bank's acquisition of an Affected Bank's Loan and/or Commitment (or, in
either case, any portion thereof) on a date other than the last day of the
applicable Interest Period with respect to any Loans then outstanding.
4.8 Survival.
The agreements and obligations of the Company in this Article IV
shall survive the payment of all other Obligations.
ARTICLE V.CONDITIONS PRECEDENT
5.1 Conditions of Initial Credit Extensions.
The obligation of each Bank to make its initial Credit Extension
hereunder is subject to the condition that the Agent shall have received on
or before the Closing Date all of the following, in form and substance
satisfactory to the Agent and each Bank, and in sufficient copies for each
Bank:
(a) Loan Documents. This Agreement, the Notes (for each
Lender that has requested a Note at least three Business Days before the
Closing Date), and a Reaffirmation of Guaranty executed by each Guarantor in
form satisfactory to the Agent, each executed by each party thereto;
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the board of directors
of the Company and each Guarantor authorizing the transactions contemplated
hereby, certified as of the Closing Date by the Secretary or an Assistant
Secretary of such Person; and
(ii) A certificate of the Secretary or Assistant
Secretary of the Company, and each Guarantor certifying the names and true
signatures of the officers of the Company or such Guarantor authorized to
execute, deliver and perform, as applicable, this Agreement, and all other
Loan Documents to be delivered by it hereunder;
(c) Organization Documents; Good Standing. Each of the
following documents:
(i) the articles or certificate of incorporation and the
bylaws, or partnership agreement, as applicable, of the Company and each
Guarantor as in effect on the Closing Date, certified by the Secretary or
Assistant Secretary of the Company or such Guarantor, or the general partner
of such Guarantor, as of the Closing Date; and
(ii) a good standing and tax good standing certificate
for the Company and each Guarantor, except for those Guarantors listed on
Schedule 5.1 as to which the Company agrees to take all action necessary to
obtain such certificates promptly after the Closing Date, issued by the
Secretary of State (or similar, applicable Governmental Authority) of its
state of incorporation or organization and each state where the Company is
qualified to do business as a foreign corporation or partnership as of a
date within five days of the Closing Date in the case of the certificates
for the Company issued by its state of incorporation, within fifteen days of
the Closing Date in the case of the certificates for the Guarantors issued
by their respective states of incorporation or organization, and within 30
days of the Closing Date in all other cases;
(d) Legal Opinions.
(i) an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, counsel to the
Company and the Guarantors and addressed to the Agent and the Banks,
substantially in the form of Exhibit D; and
(ii) a favorable opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
special counsel to the Agent;
(e) Payment of Fees. Evidence of payment by the Company of
all accrued and unpaid fees, costs and expenses to the extent then due and
payable on the Closing Date, together with reasonable Attorney Costs of Bank
of America to the extent invoiced prior to or on the Closing Date, plus such
additional amounts of reasonable Attorney Costs as shall constitute Bank of
America's reasonable estimate of Attorney Costs incurred or to be incurred
by it through the closing proceedings (provided that such estimate shall not
thereafter preclude final settling of accounts between the Company and Bank
of America); including any such costs, fees and expenses arising under or
referenced in Sections 2.10 and 11.4;
(f) Certificate. A certificate signed by a Responsible
Officer, dated as of the Closing Date, stating that:
(i) the representations and warranties contained in
Article VI are true and correct on and as of such date, as though made on
and as of such date;
(ii) no Default or Event of Default exists or would
result from the Credit Extension; and
(iii) there has occurred since September 30, 1998, no
event or circumstance that has resulted or could reasonably be expected to
result in a Material Adverse Effect;
(g) Financial Statements. Copies of (i) the consolidated
financial statements including audited balance sheets and income and cash
flow statements prepared in conformity with GAAP of the Company and its
Subsidiaries for the fiscal years ending December 31, 1995, December 31,
1996 and December 31, 1997, (ii) the consolidated financial statements
including audited balance sheets and income and cash flow statements
prepared in conformity with GAAP of Contico and its Subsidiaries for the
fiscal years ending May 31, 1996, May 31, 1997 and May 31, 1998;
(h) Consent from Departing Banks. Each "Bank" signatory to
the Existing Credit Agreement that is not a Bank hereunder shall have
consented to the Agreement in a form satisfactory to the Agent;
(i) Existing Credit Agreement. All fees, expenses, principal,
and accrued interest under the Existing Credit Agreement shall have been
paid in full through the Closing Date or arrangements made to pay such
amounts from the proceeds of the initial Revolving Loans; and
(j) Other Documents. Such other approvals, opinions,
documents or materials as the Agent or the Required Banks may reasonably
request.
5.2 Conditions of Initial Acquisition Loans.
The obligation of each Bank to make its initial Acquisition Loan
hereunder is subject to the condition that the Agent shall have received
prior to the Acquisition Loan Borrowing Date all of the following, in form
and substance satisfactory to the Agent and each Bank, and in sufficient
copies for each Bank, and all of the following conditions shall have been
satisfied:
(a) Supplements to Schedules. Receipt of supplements to the
Schedules attached hereto in form and substance acceptable to the Agent and
the Company;
(b) Purchase Agreement. A copy of the executed Purchase
Agreement and all other documents in connection therewith certified as being
true, correct and complete by the Company (evidencing an acquisition price
in compliance with subsection 8.4(h));
(c) Contico Acquisition. Evidence that the transactions
contemplated by the Purchase Agreement shall have been consummated or will
be consummated simultaneously with the funding of the initial Acquisition
Loans in accordance with the terms of the Purchase Agreement and in
compliance with applicable law and with all necessary regulatory approvals;
(d) Capital Structure. The corporate capital and ownership
structure (including articles of agreements among members) of the Acquired
Company shall be satisfactory to the Agent;
(e) Organization Documents; Good Standing. Each of the
following documents:
(i) the operating agreement of the Acquired Company as
in effect as of the date of the initial Acquisition Loan Borrowing Date,
certified by the managing member (or Person with comparable authority) of
the Acquired Company as of the date thereof, together with certification, in
a form reasonably acceptable to the Agent, of the due authorization of the
Acquired Company to enter into the transactions contemplated hereby, and the
names and the true signatures of the individuals authorized to execute,
deliver and perform, as appropriate the Guaranty and all other Loan
Documents to be delivered by it hereunder; and
(ii) a good standing and tax good standing certificate
for the Acquired Company issued by the Secretary of State (or similar,
applicable Governmental Authority) of its state of organization and each
state where the Acquired Company is qualified to do business as a foreign
corporation or partnership as of a date within five days of the initial
Acquisition Loan Borrowing Date in the case of the certificates for the
Acquired Company issued by its state of organization, and within 30 days of
the initial Acquisition Loan Borrowing Date in all other cases;
(f) Legal Opinion. An opinion of counsel to the Acquired
Company and its Subsidiaries and addressed to the Agent and the Banks, in a
form reasonably acceptable to the Agent together with reliance letters with
respect to the opinions delivered at the closing of the Contico Acquisition;
(g) Financial Statements. The Agent shall have received and,
in the case of clause (ii), approved in its reasonable discretion:
(i) unaudited interim financial statements for Contico
through November 30, 1998; and
(ii) an estimated pro forma balance sheet of the Company
and its Subsidiaries as of December 31, 1998, giving effect to the Contico
Acquisition and the transactions contemplated by this Agreement;
(h) Certificate. A certificate signed by a Responsible
Officer, dated as of the Borrowing Date of the initial Acquisition Loans,
stating that, after giving effect to the Contico Acquisition:
(i) the representations and warranties contained in
Article VI are true and correct on and as of such date, as though made on
and as of such date;
(ii) no Default or Event of Default exists or would
result from the making of the Acquisition Loans; and
(iii) there has occurred since May 31, 1998, (a) no
material adverse change in, or a material adverse effect upon, the
operations, financial condition or prospects of the Acquired Company or the
businesses represented by the Contico Assets taken as a whole; (b) a
material impairment of the ability of the Acquired Company to perform under
any Loan Document to which it is a party or of the ability of the Acquired
Company and its Subsidiaries taken as a whole to perform under the Loan
Documents to which they are a party; or (c) a material adverse effect upon
the legality, validity, binding effect or enforceability against the
Acquired Company or the Acquired Company and its Subsidiaries of any Loan
Document to which any of them are a party; and
(i) Approvals and Consents.
(i) Receipt by the Agent of all governmental,
shareholder, and third party consents (including ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇▇▇
clearance) and approvals necessary to consummate the Contico Acquisition;
(ii) expiration of the all applicable waiting periods (if
any) imposed by law that could restrain, prevent or impose any material
adverse conditions on the consummation of the Contico Acquisition; and
(j) Other Documents. Such other approvals, opinions,
documents or materials as the Agent or the Required Banks may reasonably
request, including information relating to Contico, the Contico Assets, or
the Acquired Company or evidence that the Acquired Company has developed and
implemented procedures necessary to address the Year 2000 Problem.
5.3 Conditions to All Credit Extensions.
The obligation of each Bank to make any Revolving Loan to be
made by it (including its initial Revolving Loan and its initial Acquisition
Loan) or to continue any Offshore Loan or convert any Base Rate Loan into an
Offshore Rate Loan under Section 2.4 and the obligation of the Issuing Bank
to Issue any Letter of Credit (including the initial Letter of Credit) is
subject to the satisfaction of the following conditions precedent on the
relevant Borrowing Date, Conversion/Continuation Date or Issuance Date:
(a) Notice, Application. The Agent shall have received (with,
in the case of the initial Revolving Loans only, a copy for each Bank) a
Notice of Borrowing or a Notice of Conversion/Continuation, as applicable or
in the case of any Issuance of any Letter of Credit, the Issuing Bank and
the Agent shall have received an L/C Application or L/C Amendment
Application, as required under Section 3.2;
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct on
and as of such Borrowing Date or Conversion/Continuation Date or Issuance
Date with the same effect as if made on and as of such Borrowing Date or
Conversion/Continuation Date or Issuance Date (except to the extent such
representations and warranties expressly refer to an earlier date, in which
case they shall be true and correct as of such earlier date) and, in the
case of the initial Acquisition Loans, such representations shall be true
and correct after giving effect to the Contico Acquisition; and
(c) No Existing Default. No Default or Event of Default shall
exist or shall result from such Borrowing or continuation or conversion or
Issuance.
Each Notice of Borrowing, Notice of Conversion/Continuation and L/C
Application or L/C Amendment Application submitted by the Company hereunder
shall constitute a representation and warranty by the Company hereunder, as
of the date of each such notice and as of each Borrowing Date,
Conversion/Continuation Date, or Issuance Date, as applicable, that the
conditions in this Section 5.3 are satisfied.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Bank that:
6.1 Corporate Existence and Power.
The Company and each of its Restricted Subsidiaries:
(a) is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or organization;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals to own its assets, carry on its
business and to execute, deliver, and perform its obligations under the Loan
Documents;
(c) is duly qualified as a foreign corporation, partnership,
or limited liability company and is licensed and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification or
license; and
(d) is in compliance with all Requirements of Law;
except, in each case referred to in clause (c) or clause (d), to the extent
that the failure to do so could not reasonably be expected to have a
Material Adverse Effect.
6.2 Corporate Authorization; No Contravention.
The execution, delivery and performance by the Company or any of
the Guarantors of this Agreement and each other Loan Document to which such
Person is party, have been duly authorized by all necessary corporate,
partnership, or limited liability company action, and do not and will not:
(a) contravene the terms of any of that Person's Organization
Documents;
(b) conflict with or result in any breach or contravention of,
or the creation of any Lien under, any document evidencing any Contractual
Obligation to which such Person is a party or any order, injunction, writ or
decree of any Governmental Authority to which such Person or its property is
subject; or
(c) violate any Requirement of Law.
6.3 Governmental Authorization.
No approval, consent, exemption, authorization, or other action
by, or notice to, or filing with, any Governmental Authority is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, the Company or any of the Guarantors of the Agreement
or any other Loan Document.
6.4 Binding Effect.
This Agreement and each other Loan Document to which the Company
or any Guarantor is a party constitute the legal, valid and binding
obligations of the Company and any of the Guarantors to the extent it is a
party thereto, enforceable against such Person in accordance with their
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors' rights generally or by equitable principles relating to
enforceability.
6.5 Litigation.
There are no actions, suits, proceedings, claims or disputes
pending, or to the knowledge of the Company after due investigation,
threatened or contemplated, at law, in equity, in arbitration or before any
Governmental Authority, against the Company, or its Subsidiaries or any of
their respective properties which:
(a) purport to pertain to this Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or
(b) except as specifically disclosed in Schedule 6.5, would
reasonably be expected to have a Material Adverse Effect. No injunction,
writ, temporary restraining order or any order of any nature has been issued
by any court or other Governmental Authority purporting to enjoin or
restrain the execution, delivery or performance of this Agreement or any
other Loan Document, or directing that the transactions provided for herein
or therein not be consummated as herein or therein provided.
6.6 No Default.
No Default or Event of Default exists or would result from the
incurring of any Obligations by the Company. As of the Closing Date,
neither the Company nor any Subsidiary is in default under or with respect
to any Contractual Obligation in any respect which, individually or together
with all such defaults, could reasonably be expected to have a Material
Adverse Effect, or that would, if such default had occurred after the
Closing Date, create an Event of Default under subsection 9.1(e).
6.7 ERISA Compliance.
Except as specifically disclosed in Schedule 6.7:
(a) Each Plan is in compliance in all material respects with
the applicable provisions of ERISA, the Code and other federal or state law.
Each Plan which is intended to qualify under Section 401(a) of the Code has
received a favorable determination letter from the IRS and to the best
knowledge of the Company, nothing has occurred which would cause the loss of
such qualification. The Company and each ERISA Affiliate has made all
required contributions to any Plan subject to Section 412 of the Code, and
no application for a funding waiver or an extension of any amortization
period pursuant to Section 412 of the Code has been made with respect to any
Plan.
(b) There are no pending or, to the knowledge of Company after
due investigation, threatened claims, actions or lawsuits, or action by any
Governmental Authority, with respect to any Plan which has resulted or could
reasonably be expected to result in a Material Adverse Effect. There has
been no prohibited transaction or violation of the fiduciary responsibility
rules with respect to any Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected
to occur that would reasonably be expected to result in a Material Adverse
Effect; (ii) no Pension Plan has any Unfunded Pension Liability in an
aggregate amount for the Company and its ERISA Affiliates in excess of
$3,000,000; (iii) neither the Company nor any ERISA Affiliate has incurred,
or reasonably expects to incur, any liability under Title IV of ERISA with
respect to any Pension Plan (other than premiums due and not delinquent
under Section 4007 of ERISA); (iv) neither the Company nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any liability (and
no event has occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) under Section 4201 or 4243 of ERISA
with respect to a Multiemployer Plan; and (v) neither the Company nor any
ERISA Affiliate has engaged in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA.
6.8 Use of Proceeds; Margin Regulations.
The proceeds of the Loans are to be used solely for the purposes
set forth in and permitted by Section 7.12 and Section 8.7. Neither the
Company nor any Subsidiary is generally engaged in the business of
purchasing or selling Margin Stock or extending credit for the purpose of
purchasing or carrying Margin Stock.
6.9 Title to Properties.
The Company and each Restricted Subsidiary have good record and
marketable title in fee simple to, or valid leasehold interests in, all real
property necessary or used in the ordinary conduct of their respective
businesses, except for such defects in title as could not, individually or
in the aggregate, have a Material Adverse Effect. As of the Closing Date,
the property of the Company and its Restricted Subsidiaries is subject to no
Liens, other than Permitted Liens.
6.10 Taxes.
The Company and its Subsidiaries have filed all Federal and
other material tax returns and reports required to be filed, and have paid
all Federal and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income
or assets otherwise due and payable, except those which are being contested
in good faith by appropriate proceedings and for which adequate reserves
have been provided in accordance with GAAP. There is no proposed tax
assessment against the Company or any Subsidiary that would, if made, have a
Material Adverse Effect.
6.11 Financial Condition.
(a) The audited consolidated financial statements of the
Company and its Subsidiaries dated December 31, 1997, and the related
consolidated statements of income or operations, shareholders' equity and
cash flows for the fiscal year ended on that date, and the unaudited
quarterly financial statements of the Company and its Subsidiaries dated
June 30, 1998, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for the fiscal quarter ended
on that date:
(i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein, subject, in the case of quarterly financial statements, to
ordinary, good faith year end audit adjustments;
(ii) fairly present the financial condition of the
Company and its Subsidiaries as of the date thereof and results of
operations for the period covered thereby; and
(iii) except as specifically disclosed in Schedule 6.11,
show all material indebtedness and other liabilities, direct or contingent,
of the Company and its consolidated Subsidiaries as of the date thereof,
including liabilities for taxes, material commitments and Contingent
Obligations.
(b) Since December 31, 1997, there has been no Material
Adverse Effect.
6.12 Environmental Matters.
The Company from time to time reviews the effect of existing
Environmental Laws and existing Environmental Claims on its business,
operations and properties, and as a result thereof the Company has
reasonably concluded that, except as specifically disclosed in Schedule
6.12, neither such Environmental Claims nor, to the knowledge of the Company
after due inquiry, compliance with such Environmental Laws could,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
6.13 Regulated Entities.
None of the Company, any Person controlling the Company, or any
Subsidiary, is an "Investment Company" within the meaning of the Investment
Company Act of 1940. The Company is not subject to regulation under the
Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or any other
Federal or state statute or regulation limiting its ability to incur
Indebtedness.
6.14 No Burdensome Restrictions.
Neither the Company nor any Subsidiary is a party to or bound by
any Contractual Obligation, or subject to any restriction in any
Organization Document, or any Requirement of Law, which could reasonably be
expected to have a Material Adverse Effect.
6.15 Copyrights, Patents, Trademarks and Licenses, etc.
The Company or its Restricted Subsidiaries own or are licensed
or otherwise have the right to use all of the patents, trademarks, service
marks, trade names, copyrights, contractual franchises, authorizations and
other rights that are reasonably necessary for the operation of their
respective businesses, without conflict with the rights of any other Person.
To the knowledge of the Company after due investigation, no slogan or other
advertising device, product, process, method, substance, part or other
material now employed, or now contemplated to be employed, by the Company or
any Subsidiary infringes upon any rights held by any other Person. Except
as specifically disclosed in Schedule 6.5, no claim or litigation regarding
any of the foregoing is pending or, to the knowledge of the Company after
due investigation, threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or
code is pending or, to the knowledge of the Company after due investigation,
proposed, which, in either case, could reasonably be expected to have a
Material Adverse Effect.
6.16 Subsidiaries.
As of the Closing Date, the Company has no Subsidiaries other
than those specifically disclosed in part (a) of Schedule 6.16 hereto and
has no equity investments in any other corporation or entity other than
those specifically disclosed in part (b) of Schedule 6.16. Each Restricted
Subsidiary that is a Material Subsidiary (other than the Non-Guarantor
Subsidiaries, except as provided in the last sentence of Section 7.13) has
fully complied with Section 7.13. Part (c) of Schedule 6.16 lists all
Guarantors as of the Closing Date.
6.17 Insurance.
Except as specifically disclosed in Schedule 6.17, the
properties of the Company and its Restricted Subsidiaries are insured with
financially sound and reputable insurance companies not Affiliates of the
Company, in such amounts, with such deductibles and covering such risks as
are customarily carried by companies engaged in similar businesses and
owning similar properties in localities where the Company or such Restricted
Subsidiary operates.
6.18 Swap Obligations.
Neither the Company nor any of its Restricted Subsidiaries has
incurred any outstanding obligations under any Swap Contracts, other than
Permitted Swap Obligations. The Company has undertaken its own independent
assessment of its consolidated assets, liabilities and commitments and has
considered appropriate means of mitigating and managing risks associated
with such matters and has not relied on any swap counterparty or any
Affiliate of any swap counterparty in determining whether to enter into any
Swap Contract.
6.19 Full Disclosure.
None of the representations or warranties made by the Company or
any Subsidiary in the Loan Documents as of the date such representations and
warranties are made or deemed made, and none of the statements contained in
any exhibit, report, statement or certificate furnished by or on behalf of
the Company or any Subsidiary in connection with the Loan Documents
(including the offering and disclosure materials delivered by or on behalf
of the Company to the Banks prior to the Closing Date including, to the
Company's knowledge after due inquiry, information regarding Contico, the
Contico Assets, or the Acquired Company or its Subsidiaries), contains any
untrue statement of a material fact or omits any material fact required to
be stated therein or necessary to make the statements made therein, in light
of the circumstances under which they are made, not misleading as of the
time when made or delivered. All financial projections prepared by the
Company and provided to the Agent or to any Bank hereunder or in connection
with such offering and disclosure materials have been prepared in good faith
and were believed by the Company to be reasonable based on information
possessed by the Company at the time furnished.
6.20 Y2K.
The Company has (i) initiated a review and assessment of all
areas within its and each of its Restricted Subsidiaries' business and
operations (including those affected by suppliers and vendors) that could be
adversely affected by the "Year 2000 Problem" (that is, the risk that
computer applications used by the Company or any of its Restricted
Subsidiaries or its suppliers and vendors) may be unable to recognize and
perform properly date-sensitive functions involving certain dates prior to
and any date after December 31, 1999), (ii) developed a plan and timeline
for addressing the Year 2000 Problem on a timely basis, and (iii) as of the
Closing Date, implemented that plan in accordance with that timetable. The
Company reasonably believes that all computer applications (including those
of its suppliers and vendors) that are material to its or any of its
Restricted Subsidiaries' business and operations will on a timely basis be
able to perform properly date-sensitive functions for all dates before and
after January 1, 2000 (that is, be "Year 2000 Compliant"), except to the
extent that a failure to do so could not reasonably be expected to have a
Material Adverse Effect.
ARTICLE VII.
AFFIRMATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any
Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter
of Credit shall remain outstanding, unless the Required Banks waive
compliance in writing:
7.1 Financial Statements.
The Company shall deliver to the Agent and each Bank, in form
and detail satisfactory to the Agent and the Required Banks:
(a) as soon as available, but not later than 90 days after the
end of each fiscal year (commencing with the fiscal year ended December 31,
1998), a copy of the audited consolidated balance sheet of the Company and
its Subsidiaries as at the end of such year and the related consolidated
statements of income or operations, shareholders' equity and cash flows for
such year, setting forth in each case in comparative form the figures for
the previous fiscal year, and accompanied by the opinion of Deloitte &
Touche or another nationally-recognized independent public accounting firm
("Independent Auditor") which report shall state that such consolidated
financial statements present fairly the financial position for the periods
indicated in conformity with GAAP applied on a basis consistent with prior
years. Such opinion shall not be qualified or limited because of a
restricted or limited examination by the Independent Auditor of any material
portion of the Company's or any Subsidiary's records;
(b) as soon as available, but not later than 45 days after the
end of each of the first three fiscal quarters of each fiscal year
(commencing with the fiscal quarter ended March 31, 1999), a copy of the
unaudited consolidated balance sheet of the Company and its Subsidiaries as
of the end of such quarter and the related consolidated statements of
income, shareholders' equity and cash flows for the period commencing on the
first day and ending on the last day of such quarter, and certified by a
Responsible Officer as fairly presenting, in accordance with GAAP (subject
to ordinary, good faith year-end audit adjustments), the financial position
and the results of operations of the Company and its Subsidiaries;
(c) as soon as available, but not later than 90 days after the
end of each fiscal year (commencing with the fiscal year ended December 31,
1998), a copy of an unaudited consolidating balance sheet of the Company and
its Subsidiaries as at the end of such year and the related consolidating
statement of income and shareholders' equity for such year, certified by a
Responsible Officer as having been developed and used in connection with the
preparation of the financial statements referred to in subsection 7.1(a);
and
(d) as soon as available, but not later than 90 days after the
end of each of the first three fiscal quarters of each fiscal year
(commencing with the fiscal quarter ended March 31, 1999), a copy of the
unaudited consolidating balance sheets of the Company and its Subsidiaries,
and the related consolidating statements of income, shareholders' equity and
cash flows for such quarter, all certified by a Responsible Officer as
having been developed and used in connection with the preparation of the
financial statements referred to in subsection 7.1(b).
7.2 Certificates; Other Information.
The Company shall furnish to the Agent and each Bank:
(a) concurrently with the delivery of the financial statements
referred to in subsections 7.1(a) and (b), a Compliance Certificate executed
by a Responsible Officer, accompanied by calculations in reasonable detail
evidencing the elimination of items attributable to Unrestricted
Subsidiaries from the financial statements delivered pursuant to
Section 7.1;
(b) promptly, copies of all audit reports and management audit
letters delivered by the Independent Auditor to the Company;
(c) promptly, copies of all financial statements and reports
that the Company sends to its shareholders, and copies of all financial
statements and regular, periodical or special reports (including Forms 10K,
10Q and 8K) that the Company or any Restricted Subsidiary may make to, or
file with, the SEC;
(d) promptly, such additional information regarding the
business, financial or corporate affairs of the Company or any Subsidiary
(including information regarding financial position, projections or business
prospects of the Company and the Restricted Subsidiaries) as the Agent, at
the request of any Bank, may from time to time reasonably request; and
(e) promptly upon receipt thereof, copies of all notices or
other written information (including financial statements) received under
the Purchase Agreement by the Company or the Acquired Company before the
closing of the Contico Acquisition and simultaneously with the giving
thereof, copies of each notice given by the Company or the Acquired Company
thereunder before the closing of the Contico Acquisition.
7.3 Notices.
The Company shall promptly notify the Agent and each Bank:
(a) of the occurrence of any Default or Event of Default, and
of the occurrence or existence of any event or circumstance that foreseeably
will become a Default or Event of Default;
(b) of any matter that has resulted or could reasonably be
expected to result in a Material Adverse Effect, including (i) breach or
non-performance of, or any default under, a Contractual Obligation of the
Company or any Restricted Subsidiary; (ii) any dispute, litigation,
investigation, proceeding or suspension between the Company or any
Restricted Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or
proceeding affecting the Company or any Restricted Subsidiary; including
pursuant to any applicable Environmental Laws;
(c) of the occurrence of any of the following events affecting
the Company or any ERISA Affiliate (but in no event more than 30 days after
such event), and deliver to the Agent and each Bank a copy of any notice
with respect to such event that is filed with a Governmental Authority and
any notice delivered by a Governmental Authority to the Company or any ERISA
Affiliate with respect to such event:
(i) an ERISA Event (except with respect to an ERISA
Event concerning a Mutiemployer Plan, in which event the Company shall
provide such notice as soon as practicable, but in any event within 10 days,
after receiving notice of the such ERISA Event);
(ii) a material increase in the Unfunded Pension
Liability of any Pension Plan;
(iii) the adoption of, or the commencement of material
contributions to, any Plan subject to Section 412 of the Code by the Company
or any ERISA Affiliate; or
(iv) the adoption of any amendment to a Plan subject to
Section 412 of the Code, if such amendment results in a material increase in
contributions or Unfunded Pension Liability.
(d) of any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries;
(e) upon the request from time to time of the Agent, the Swap
Termination Values, together with a description of the method by which such
values were determined, relating to any then-outstanding Swap Contracts to
which the Company or any of its Restricted Subsidiaries is party; and
(f) until the closing of the Acquisition Loans and in each
case if known by a Responsible Officer of the Company, of (a) any material
adverse change in, or a material adverse effect upon, the operations,
financial condition or prospects of the Acquired Company or the businesses
represented by the Contico Assets taken as a whole; (b) any material
impairment of the ability of the Acquired Company to perform under any Loan
Document to which it will be a party or of the ability of the Acquired
Company and its Subsidiaries taken as a whole to perform under the Loan
Documents to which it or they will be a party; and (c) a material adverse
effect upon the legality, validity, binding effect or enforceability against
the Acquired Company or the Acquired Company and its Subsidiaries of any
Loan Document to which it or they will be a party.
Each notice under this Section shall be accompanied by a written statement
by a Responsible Officer setting forth details of the occurrence referred to
therein, and stating what action the Company or any affected Subsidiary
proposes to take with respect thereto and at what time. Each notice under
subsection 7.3(a) shall describe with particularity any and all clauses or
provisions of this Agreement or other Loan Document that have been (or
foreseeably will be) breached or violated.
7.4 Preservation of Corporate Existence, Etc.
The Company shall, and shall cause each Restricted Subsidiary
to:
(a) preserve and maintain in full force and effect its
existence and good standing under the laws of its state or jurisdiction of
incorporation or organization;
(b) preserve and maintain in full force and effect all
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary or desirable in the normal conduct of its business;
(c) use reasonable efforts, in the ordinary course of
business, to preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents,
trademarks, trade names and service marks, the non-preservation of which
could reasonably be expected to have a Material Adverse Effect;
in each case except in connection with transactions permitted by Section 8.3
and dispositions of assets permitted by Section 8.2.
7.5 Maintenance of Property.
The Company shall maintain, and shall cause each Restricted
Subsidiary to maintain, and preserve all its property which is used or
useful in its business in good working order and condition, ordinary wear
and tear excepted and make all necessary repairs thereto and renewals and
replacements thereof except where the failure to do so could not reasonably
be expected to have a Material Adverse Effect and except as permitted by
Section 8.2. The Company and each Restricted Subsidiary shall use the
standard of care typical in the industry in the operation and maintenance of
its facilities.
7.6 Insurance.
The Company shall maintain, and shall cause each Restricted
Subsidiary to maintain, with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss
or damage of the kinds customarily insured against by Persons engaged in the
same or similar business, of such types and in such amounts as are
customarily carried under similar circumstances by such other Persons.
7.7 Y2K.
The Company will promptly notify the Agent in the event the
Company discovers or determines that any computer application (including
those of its suppliers and vendors) that is material to its or any of its
Restricted Subsidiaries business and operations will not be Year 2000
Compliant on a timely basis, except to the extent that such failure could
not reasonably be expected to have a Material Adverse Effect.
7.8 Compliance with Laws.
The Company shall comply, and shall cause each Subsidiary to
comply, in all material respects with all Requirements of Law of any
Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
7.9 Compliance with ERISA.
The Company shall, and shall cause each of its ERISA Affiliates
to: (a) maintain each Plan in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law; (b)
cause each Plan which is qualified under Section 401(a) of the Code to
maintain such qualification; and (c) make all required contributions to any
Plan subject to Section 412 of the Code; provided, however, that any such
Plan may be voluntarily terminated in accordance with ERISA and the Code so
long as such termination could not reasonably be expected to give rise to
aggregate liability of the Company and its Subsidiaries in excess of
$3,000,000 or otherwise have a Material Adverse Effect.
7.10 Inspection of Property and Books and Records.
The Company shall maintain and shall cause each Subsidiary to
maintain proper books of record and account, in which full, true and correct
entries in conformity with GAAP consistently applied shall be made of all
financial transactions and matters involving the assets and business of the
Company and such Subsidiary. The Company shall permit, and shall cause each
Subsidiary to permit, representatives and independent contractors of the
Agent or any Bank to visit and inspect any of their respective properties,
to examine their respective corporate, financial and operating records, and
make copies thereof or abstracts therefrom, and to discuss their respective
affairs, finances and accounts with their respective directors, officers,
and independent public accountants, all at the expense of the Company and at
such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Company; provided,
however, when an Event of Default exists the Agent or any Bank may do any of
the foregoing at the expense of the Company at any time during normal
business hours and without advance notice.
7.11 Environmental Laws.
The Company shall, and shall cause each Subsidiary to, conduct
its operations and keep and maintain its property in material compliance
with all Environmental Laws.
7.12 Use of Proceeds.
The Company shall use the proceeds of the Loans (a) to refinance
amounts outstanding under the Existing Credit Agreement, (b) to pay the cash
portion of the purchase price of the Contico Acquisition and fees and
expenses incurred in connection therewith, and (c) for working capital,
capital expenditures, and other general corporate purposes, including for
purposes of undertaking other Permitted Acquisitions, not in contravention
of any Requirement of Law or of any Loan Document.
7.13 New Subsidiaries.
If the Company or any of its Subsidiaries at any time after the
date hereof acquires, forms or establishes any Restricted Subsidiary that is
a Material Subsidiary (other than a Subsidiary that is not organized in the
United States), or if any Restricted Subsidiary that has not executed a
Guaranty becomes a Material Subsidiary (other than a Subsidiary that is not
organized in the United States), the Company shall cause any such Restricted
Subsidiary to promptly execute a Guaranty substantially in the form of
Exhibit G and to provide the Agent and each Bank with such evidence of due
authorization, execution, and delivery of such Guaranty as the Agent or the
Required Banks may reasonably require.
7.14 Purchase Agreement.
The Company shall perform in all material respects its
obligations under the Purchase Agreement.
ARTICLE VIII.
NEGATIVE COVENANTS
So long as any Bank shall have any Commitment hereunder, or any
Loan or other Obligation shall remain unpaid or unsatisfied, or any Letter
of Credit shall remain outstanding, unless the Required Banks waive
compliance in writing:
8.1 Limitation on Liens.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, directly or indirectly, make, create, incur,
assume or suffer to exist any Lien upon or with respect to any part of its
property, whether now owned or hereafter acquired, other than the following
("Permitted Liens"):
(a) any Lien existing on property of the Company or any
Restricted Subsidiary on the Closing Date and set forth in Schedule 8.1
securing Indebtedness outstanding on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental
charges which are not delinquent or remain payable without penalty, provided
that no notice of lien has been filed or recorded under the Code;
(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary
course of business which are not delinquent or remain payable without
penalty or which are being contested in good faith and by appropriate
proceedings, which proceedings have the effect of preventing the forfeiture
or sale of the property subject thereto;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other
social security legislation;
(f) Liens on the property of the Company or any of its
Restricted Subsidiaries securing (i) the non-delinquent performance of bids,
trade contracts (other than for borrowed money), leases, statutory
obligations, (ii) contingent obligations on surety and appeal bonds, and
(iii) other non-delinquent obligations of a like nature; in each case,
incurred in the ordinary course of business, provided all such Liens in the
aggregate would not (even if enforced) cause a Material Adverse Effect;
(g) Liens consisting of judgment or judicial attachment liens,
provided that the enforcement of such Liens is effectively stayed and all
such liens in the aggregate at any time outstanding for the Company and its
Restricted Subsidiaries do not exceed $2,000,000;
(h) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or
interfere with the ordinary conduct of the businesses of the Company and its
Restricted Subsidiaries;
(i) Liens on assets of other Persons that become Restricted
Subsidiaries after the date of this Agreement so long as the Liens described
in this subsection 8.1(i) existed at the time the respective corporations
became Restricted Subsidiaries, were not created in anticipation thereof,
and do not secure aggregate Indebtedness outstanding at any one time in
excess of $5,000,000;
(j) purchase money security interests on any property acquired
or held by the Company or its Restricted Subsidiaries securing Indebtedness
incurred or assumed for the purpose of financing all or any part of the cost
of acquiring such property; provided that (i) any such Lien attaches to such
property concurrently with or within 120 days after the acquisition thereof,
(ii) such Lien attaches solely to the property so acquired in such
transaction, (iii) the principal amount of the debt secured thereby does not
exceed 100% of the cost of such property, and (iv) the principal amount of
the Indebtedness secured by any and all such purchase money security
interests shall not at any time exceed $7,000,000, (iv) no Default or Event
of Default shall exist at the time the Indebtedness secured by such purchase
money security interests was incurred or would arise as a result thereof;
(k) Liens securing obligations in respect of Capital Leases on
assets subject to such leases, provided that such Capital Leases are
otherwise permitted hereunder and no Default or Event of Default shall exist
at the time the obligations in respect of such Capital Leases arose or would
arise as a result thereof;
(l) Liens arising solely by virtue of any statutory or common
law provision relating to banker's liens, rights of set-off or similar
rights and remedies as to deposit accounts or other funds maintained with a
creditor depository institution; provided that (i) such deposit account is
not a dedicated cash collateral account and is not subject to restrictions
against access by the Company in excess of those set forth by regulations
promulgated by the FRB, and (ii) such deposit account is not intended by the
Company or any Restricted Subsidiary to provide collateral to the depository
institution;
(m) Liens consisting of pledges of cash collateral or
government securities to secure on a ▇▇▇▇-to-market basis Permitted Swap
Obligations only, provided that (i) the counterparty to any Swap Contract
relating to such Permitted Swap Obligation is under a similar requirement to
deliver similar collateral from time to time to the Company or the
Restricted Subsidiary party thereto on a ▇▇▇▇-to-market basis; and (ii) the
aggregate value of such collateral so pledged by the Company and its
Restricted Subsidiaries together in favor of all counterparties does not at
any time exceed $5,000,000;
(n) Liens on the property comprising the ▇▇▇▇▇ Industries
manufacturing facility to secure Indebtedness permitted by subsection
8.5(h); and
(o) Liens not otherwise permitted hereunder securing
obligations in an aggregate amount not to exceed $3,000,000.
8.2 Disposition of Assets.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, directly or indirectly, sell, assign, lease,
convey, transfer or otherwise dispose of (whether in one or a series of
transactions) any property (including accounts and notes receivable, with or
without recourse) or enter into any agreement to do any of the foregoing,
except:
(a) dispositions of inventory, or used, worn-out or surplus
equipment, all in the ordinary course of business;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied to
the purchase price of such replacement equipment;
(c) dispositions of inventory or equipment by the Company or
any Restricted Subsidiary to the Company or any Restricted Subsidiary
pursuant to reasonable business requirements; and
(d) dispositions not otherwise permitted hereunder which are
made for fair market value; provided, that (i) such dispositions are of
assets of Subsidiaries in the Machinery Manufacturing Group or assets
associated with lines of business operated at the Closing Date by ▇▇▇▇▇▇▇▇
Precision Metals, Inc., Savannah Energy Construction Company, Inc., Savannah
Energy Systems Company, Inc., or assets owned at the time of disposition by
any Unrestricted Subsidiary, or of Investments in Unrestricted Subsidiaries
or of Investments listed in Schedule 8.2, or, (ii) if such dispositions are
of assets other than those in the preceding subsection 8.2(d)(i), (1) at the
time of such disposition, no Event of Default shall exist or shall result
from such disposition, (2) the aggregate sales price from such disposition
shall be paid in cash, (3) the aggregate value of all assets so sold by the
Company and its Restricted Subsidiaries, together, shall not exceed in any
fiscal year 15% of the book value of the consolidated assets of the Company
and its Restricted Subsidiaries, and (4) prior to becoming contractually
committed to make any such disposition, the Company shall have delivered to
the Banks pro forma consolidated financial statements for the Company and
its Restricted Subsidiaries accompanied by a Compliance Certificate signed
by a Responsible Officer certifying that at the end of the last fiscal
quarter for which such financial statements and Compliance Certificate have
been delivered pursuant to Sections 7.1 and 7.2, (A) the Company and its
Restricted Subsidiaries would have been in compliance with the conditions in
preceding clauses (1)-(3) with respect to the proposed disposition, and
(B) after giving pro forma effect for four trailing quarters to such
disposition by excluding EBITDA with respect to the assets so sold, the
Company and its Restricted Subsidiaries would have been in compliance with
the financial covenants set forth in Sections 8.18, 8.19, 8.20 and 8.21.
8.3 Consolidations and Mergers.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, merge, consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except:
(a) any Subsidiary may merge with the Company, provided that
the Company shall be the continuing or surviving corporation, or with any
one or more Restricted Subsidiaries, provided that if any transaction shall
be between an Unrestricted Subsidiary and a Restricted Subsidiary, the
Restricted Subsidiary shall be the continuing or surviving corporation, and
if between a Subsidiary and a Wholly Owned Subsidiary, the Wholly Owned
Subsidiary shall be the continuing or surviving corporation;
(b) any Restricted Subsidiary may sell all or substantially
all of its assets (upon voluntary liquidation or otherwise), to the Company
or another Wholly Owned Subsidiary that is a Restricted Subsidiary; and
(c) the Company or any Restricted Subsidiary may merge with a
Person that is not a Subsidiary of the Company in order to consummate an
Acquisition not prohibited herein, and any Restricted Subsidiary may merge
with a Person that is not a Subsidiary of the Company in order to consummate
a sale of assets not prohibited herein, provided that in any merger
involving the Company, the Company shall be the continuing or surviving
corporation and in any merger intended to consummate an Acquisition, the
resulting Person shall be a Wholly Owned Subsidiary and a Restricted
Subsidiary.
8.4 Loans and Investments.
The Company shall not purchase or acquire, or suffer or permit
any Restricted Subsidiary to purchase or acquire, or make any commitment
therefor, any capital stock, equity interest, or any obligations or other
securities of, or any interest in, any Person, or make or commit to make any
Acquisitions, or make or commit to make any advance, loan, extension of
credit or capital contribution to or any other investment in, any Person
including any Affiliate of the Company (together, "Investments"), except
for:
(a) Investments held by the Company or any Restricted
Subsidiary in the form of cash equivalents or short term marketable
securities;
(b) extensions of credit in the nature of accounts receivable
or notes receivable arising from the sale or lease of goods or services in
the ordinary course of business;
(c) Investments existing on the date hereof as set forth on
Schedule 8.4;
(d) Investments (including Intercompany Advances) in
Unrestricted Subsidiaries, Non-Guarantor Subsidiaries and ▇▇▇▇▇ (calculated
on the initial investment amount but adjusted to take into account any
proceeds received by the Company or any Restricted Subsidiary that is a
Wholly Owned Subsidiary on a liquidation or repayment of any such
Investments) as long as (i) such Investments made after the Closing Date do
not exceed at any time, together with Investments made after the Closing
Date to consummate Acquisitions of Unrestricted Subsidiaries or Non-
Guarantor Subsidiaries pursuant to subsection 8.4(f), 10% of the Net Worth,
and (ii) at the time any such Investment is made, no Default or Event of
Default exists or would result from such Investment;
(e) Intercompany Advances by the Company to any Restricted
Subsidiary that is a Wholly Owned Subsidiary other than ▇▇▇▇▇ or any Non-
Guarantor Subsidiary or by any of its Restricted Subsidiaries to another
Restricted Subsidiary that is a Wholly Owned Subsidiary other than ▇▇▇▇▇ or
any Non-Guarantor Subsidiary;
(f) Investments incurred in order to consummate Acquisitions,
if and only if with respect to such Acquisitions (i) Persons acquired are
engaged in substantially the same lines of business as the
Electrical/Electronic Group or the Maintenance Group, (ii) unless prior
approval is granted by the Required Banks, (1) the cash purchase price
(including assumed Indebtedness) of any single Acquisition shall not exceed
$25,000,000, (2) the aggregate cash purchase price (including assumed
Indebtedness) of all Acquisitions in any 12 month period shall not exceed
$50,000,000 (it being agreed for purposes of clauses (1) and (2) that stock
issued in conjunction with any Acquisition shall not be considered as a part
of the "cash purchase price"), (3) any Person to be acquired must have
positive EBITDA for the four fiscal quarters preceding the Acquisition date,
and (4) prior to becoming contractually committed to make any Acquisition,
the Company shall have delivered to the Banks pro forma consolidated
financial statements for the Company and its Restricted Subsidiaries
accompanied by a Compliance Certificate signed by a Responsible Officer
certifying that (A) at the time any such Acquisition is consummated, the
Company and its Restricted Subsidiaries will be in compliance with the
conditions in preceding clauses (1)-(3), and (B) after giving pro forma
effect to any such Acquisition, the Company and its Restricted Subsidiaries
will remain in compliance with the financial covenants set forth in Sections
8.18, 8.19, 8.20 and 8.21 (giving effect to the EBITDA of the acquired
Person as and to the extent provided in the definition of EBITDA), (iii)
such Acquisitions are undertaken in accordance with all applicable
Requirements of Law; (iv) no Default or Event of Default exists or would
result from any such Acquisition, and (v) the prior, effective consent or
approval of such Acquisition has been given by the board of directors or
equivalent governing body of the Person acquired;
(g) Investments constituting Permitted Swap Obligations or
payments or advances under Swap Contracts relating to Permitted Swap
Obligations;
(h) the Contico Acquisition for a total cash consideration
(including deferred purchase price) not to exceed $140,000,000.00 and for
total consideration not to exceed $175,000,000.00; and
(i) commitments to make Acquisitions not otherwise permitted
hereunder as long as such commitments are conditioned upon the consent of
the Required Banks.
8.5 Limitation on Indebtedness.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, create, incur, assume, suffer to exist, or
otherwise become or remain directly or indirectly liable with respect to,
any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations
permitted pursuant to Section 8.8;
(c) Indebtedness existing on the Closing Date and set forth in
Schedule 8.5;
(d) Indebtedness secured by Liens permitted by
subsections 8.1(i) or (j) in an aggregate amount outstanding not to exceed
$12,000,000;
(e) Indebtedness secured by Liens permitted by
subsection 8.1(m) in an aggregate amount outstanding not to exceed
$5,000,000;
(f) Intercompany Advances permitted by Section 8.4(e);
(g) Indebtedness incurred in connection with leases permitted
pursuant to Section 8.10;
(h) Non-recourse Indebtedness of ▇▇▇▇▇ Industries in an
aggregate principal amount not to exceed $1,200,000; and
(i) Indebtedness not otherwise permitted hereunder in an
aggregate principal amount not to exceed $5,000,000.
8.6 Transactions with Affiliates.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, enter into any transaction with any Affiliate of
the Company, except upon fair and reasonable terms no less favorable to the
Company or such Restricted Subsidiary than would obtain in a comparable
arm's-length transaction with a Person not an Affiliate of the Company or
such Restricted Subsidiary.
8.7 Use of Proceeds.
(a) The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, use any portion of the Loan proceeds or any Letter
of Credit, directly or indirectly, (i) to purchase or carry Margin Stock,
(ii) to repay or otherwise refinance indebtedness of the Company or others
incurred to purchase or carry Margin Stock, (iii) to extend credit for the
purpose of purchasing or carrying any Margin Stock, or (iv) to acquire any
security in any transaction that is subject to Section 13 or 14 of the
Exchange Act.
(b) The Company shall not, directly or indirectly, use any
portion of the Loan proceeds or any Letter of Credit (i) knowingly to
purchase Ineligible Securities from ▇▇▇▇▇▇▇▇▇▇ during any period in which
▇▇▇▇▇▇▇▇▇▇ makes a market in such Ineligible Securities, (ii) knowingly to
purchase during the underwriting or placement period Ineligible Securities
being underwritten or privately placed by ▇▇▇▇▇▇▇▇▇▇, or (iii) to make
payments of principal or interest on Ineligible Securities underwritten or
privately placed by ▇▇▇▇▇▇▇▇▇▇ and issued by or for the benefit of the
Company or any Affiliate of the Company. The ▇▇▇▇▇▇▇▇▇▇ is a registered
broker-dealer and permitted to underwrite and deal in certain Ineligible
Securities; and "Ineligible Securities" means securities which may not be
underwritten or dealt in by member banks of the Federal Reserve System under
Section 16 of the Banking Act of 1933 (12 U.S.C. 24, Seventh), as amended.
8.8 Contingent Obligations.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, create, incur, assume or suffer to exist any
Contingent Obligations except:
(a) endorsements for collection or deposit in the ordinary
course of business;
(b) Permitted Swap Obligations (excluding any Guaranty
Obligation in respect thereof);
(c) Contingent Obligations of the Company and its Restricted
Subsidiaries existing as of the Closing Date and listed in Schedule 8.8;
(d) Contingent Obligations with respect to Surety Instruments
incurred in the ordinary course of business and not exceeding at any time
$3,000,000 in the aggregate in respect of the Company and its Restricted
Subsidiaries together;
(e) Contingent Obligations under the Loan Documents, including
L/C Obligations; and
(f) Contingent Obligations not otherwise permitted hereunder
in an aggregate amount not to exceed $1,000,000.
8.9 Joint Ventures.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to enter into any Joint Venture, other than in
businesses related to those carried on by the Company and its Restricted
Subsidiaries on the Closing Date or those related to the Contico Assets.
8.10 Lease Obligations.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, create or suffer to exist any obligations for the
payment of rent for any property under any Capital Lease, except for Capital
Leases entered into by the Company or any Restricted Subsidiary to finance
the acquisition of equipment; provided that the aggregate annual rental
payments for all such Capital Leases shall not exceed in any fiscal year
$3,000,000.
8.11 Restricted Payments.
The Company shall not, and shall not suffer or permit any
Subsidiary to, declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of
any shares of any class of its capital stock, or purchase, redeem or
otherwise acquire for value any shares of its capital stock or any warrants,
rights or options to acquire such shares, now or hereafter outstanding;
except that the Company and any Restricted Subsidiary may:
(a) declare and make dividend payments or other distributions
payable solely in its common stock;
(b) purchase, redeem or otherwise acquire shares of its common
stock or warrants or options to acquire any such shares with the proceeds
received from the substantially concurrent issue of new shares of its common
stock; provided that, immediately after giving effect to such proposed
action, no Default or Event of Default would exist;
(c) repurchase shares of its capital stock in an aggregate
amount not to exceed either (i) $5,000,000 in any 12 month period or (ii)
$10,000,000 since the Closing Date ("Permitted Stock Repurchases");
provided, that, immediately after giving effect to such proposed action, no
Default or Event of Default would exist; and
(d) declare or pay cash dividends to the holders of its equity
interests, including on account of the Preferred Units, provided, that,
immediately after giving effect to such proposed action, no Default or Event
of Default would exist.
8.12 ERISA.
The Company shall not, and shall not suffer or permit any of its
ERISA Affiliates to: (a) engage in a prohibited transaction or violation of
the fiduciary responsibility rules with respect to any Plan which has
resulted or could reasonably expected to result in liability of the Company
in an aggregate amount in excess of $3,000,000; or (b) engage in a
transaction that could be subject to Section 4069 or 4212(c) of ERISA.
8.13 Change in Business.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, engage in any material line of business
substantially different from those lines of business carried on by the
Company and its Subsidiaries on the date hereof.
8.14 Accounting Changes.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, make any significant change in accounting
treatment or reporting practices, except as required by GAAP, or change the
fiscal year of the Company or of any Subsidiary.
8.15 Amendment to Purchase Documents.
The Company shall not take any action or make any agreement with
any party to the Purchase Agreement which will modify, change, alter or
amend any of the terms or conditions thereof in any respect that would
impair the rights of the Banks under the Loan Documents without the express
written consent of the Required Banks.
8.16 Limitation on Negative Pledge Clauses.
The Company shall not, and shall not suffer or permit any
Restricted Subsidiary to, enter into any agreement with any Person other
than the Agent and the Banks pursuant to this Agreement or any of the other
Loan Documents which prohibits or limits the ability of the Company or any
Restricted Subsidiary to create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired; provided, that the Company may enter into such an agreement in
connection with any Permitted Liens described in subsections 8.1 (j) and (k)
when such prohibition or limitation is by its terms effective only against
the assets subject to such Permitted Lien.
8.17 Limitation on Restrictions on Subsidiary Dividends and Other
Distributions.
The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, create or otherwise cause or suffer
to exist or become effective any encumbrance or restriction on the ability
of any Restricted Subsidiary to (a) pay dividends or make any other
distributions on its Capital Stock or any other interest or participation in
its profits owned by the Company or any Restricted Subsidiary, or pay any
Indebtedness owed to the Company or a Restricted Subsidiary, (b) make loans
or advances to the Company, or (c) transfer any of its properties or assets
to the Company, except for such encumbrances or restrictions existing under
or by reasons of (i) applicable law, (ii) this Agreement, and
(iii) customary provisions restricting subletting or assignment of any lease
governing a leasehold interest of the Company or a Restricted Subsidiary.
8.18 Minimum Net Worth.
The Company shall not permit Net Worth, measured as of the end
of each fiscal quarter, to be less than the sum of (a) $164,477,100 if the
Contico Acquisition occurred before the end of such fiscal quarter or
$130,877,100 if the Contico Acquisition has not so occurred, plus (b) 50% of
quarterly net income (with no deduction for losses) for the fiscal quarter
ending December 31, 1998 and each fiscal quarter thereafter, plus (c) 75% of
the net proceeds to the Company of new capital stock or other equity
interests issued by the Company or any Restricted Subsidiary after the
Closing Date, minus (d) the actual amount of Permitted Stock Repurchases
after the Closing Date.
8.19 Maximum Leverage Ratio.
The Company shall not permit its Leverage Ratio to be greater
than (i) as of the end of any fiscal quarter ending before the Contico
Acquisition, 2.50 to 1.00, and (ii) as of the end of any fiscal quarter
ending on or after the Contico Acquisition, the ratio set forth below:
Quarters Ending Maximum Leverage
Ratio
Through September 30,
1999 3.50 to 1.00
December 31, 1999
through March 31,
2000 3.25 to 1.00
June 30, 2000
through Facility B
Revolving
Termination Date 3.00 to 1.00
8.20 Minimum Fixed Charge Coverage Ratio.
The Company shall not permit its Fixed Charge Coverage Ratio, as
of the end of any fiscal quarter to be less than the ratio set forth below:
Quarters Ending Minimum Fixed
Charge Coverage
Ratio
Through September 30,
2000 1.10 to 1.00
December 31, 2000
through Facility B
Revolving
Termination Date 1.25 to 1.00
8.21 Quarterly Losses.
The Company shall not have a pre-tax loss in any two consecutive
fiscal quarters.
ARTICLE IX.
EVENTS OF DEFAULT
9.1 Event of Default.
Any of the following shall constitute an "Event of Default":
(a) Non-Payment. The Company fails to pay, (i) when and as
required to be paid herein, any amount of principal of any Loan or of any
L/C Obligation, or (ii) within 3 days after the same becomes due, any
interest, fee or any other amount payable hereunder or under any other Loan
Document; or
(b) Representation or Warranty. Any representation or
warranty by the Company or any Guarantor made or deemed made herein, in any
other Loan Document or in the Existing Credit Agreement, or which is
contained in any certificate, document or financial or other statement by
the Company, any Guarantor, or any Responsible Officer, furnished at any
time under this Agreement, or in or under any other Loan Document or the
Existing Credit Agreement, is incorrect in any material respect on or as of
the date made or deemed made; or
(c) Specific Defaults. (i) The Company or any Guarantor fails
to perform or observe any term, covenant or agreement contained in either of
Sections 7.1 or 7.2 and such failure continues for 30 days, or (ii) the
Company or any Guarantor fails to perform or observe any term, covenant or
agreement contained in either of Sections 7.3 or 7.9 or in Article VIII; or
(d) Other Defaults. The Company or any Guarantor fails to
perform or observe any other term or covenant contained in this Agreement or
any other Loan Document, and such default shall continue unremedied for a
period of 30 days after the earlier of (i) the date upon which a Responsible
Officer knew of such failure or (ii) the date upon which written notice
thereof is given to the Company by the Agent or any Bank; or
(e) Cross-Default. (i) The Company or any Guarantor (A) fails
to make any payment in respect of any Indebtedness or Contingent Obligation
(other than in respect of Swap Contracts), having an aggregate principal
amount (including undrawn committed or available amounts and including
amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $5,000,000 when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise) and such
failure continues after the applicable grace or notice period, if any,
specified in the relevant document on the date of such failure; or (B) fails
to perform or observe any other condition or covenant, or any other event
shall occur or condition exist, under any agreement or instrument relating
to any such Indebtedness or Contingent Obligation, and such failure
continues after the applicable grace or notice period, if any, specified in
the relevant document on the date of such failure if the effect of such
failure, event or condition is to cause, or to permit the holder or holders
of such Indebtedness or beneficiary or beneficiaries of such Indebtedness
(or a trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries) to cause such Indebtedness to be declared to be due and
payable prior to its stated maturity, or such Contingent Obligation to
become payable or cash collateral in respect thereof to be demanded; or
(ii) there occurs under any Swap Contract an Early Termination Date (as
defined in such Swap Contract) resulting from (1) any event of default under
such Swap Contract as to which the Company or any Guarantor Subsidiary is
the Defaulting Party (as defined in such Swap Contract) or (2) any
Termination Event (as so defined) as to which the Company or any Guarantor
Subsidiary is an Affected Party (as so defined), and, in either event, the
Swap Termination Value owed by the Company or such Guarantor as a result
thereof is greater than $5,000,000; or
(f) Insolvency; Voluntary Proceedings. The Company or any
Guarantor (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due,
subject to applicable grace periods, if any, whether at stated maturity or
otherwise; (ii) voluntarily ceases to conduct its business in the ordinary
course; (iii) commences any Insolvency Proceeding with respect to itself; or
(iv) takes any action to effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company or any Guarantor, or
any writ, judgment, warrant of attachment, execution or similar process, is
issued or levied against a substantial part of the Company's or any
Guarantor properties, and any such proceeding or petition shall not be
dismissed, or such writ, judgment, warrant of attachment, execution or
similar process shall not be released, vacated or fully bonded within 60
days after commencement, filing or levy; (ii) the Company or any Guarantor
admits the material allegations of a petition against it in any Insolvency
Proceeding, or an order for relief (or similar order under non-U.S. law) is
ordered in any Insolvency Proceeding; or (iii) the Company or any Guarantor
acquiesces in the appointment of a receiver, trustee, custodian,
conservator, liquidator, mortgagee in possession (or agent therefor), or
other similar Person for itself or a substantial portion of its property or
business; or
(h) ERISA. (i) An ERISA Event shall occur with respect to a
Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in liability of the Company under Title IV of ERISA to
the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in
excess of $3,000,000; the aggregate amount of Unfunded Pension Liability
among all Pension Plans at any time exceeds $3,000,000; or (iii) the Company
or any ERISA Affiliate shall fail to pay when due, after the expiration of
any applicable grace period, any installment payment with respect to its
withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan
in an aggregate amount in excess of $3,000,000; or
(i) Monetary Judgments. One or more non-interlocutory
judgments, non-interlocutory orders, decrees or arbitration awards is
entered against the Company or any Subsidiary involving in the aggregate a
liability (to the extent not covered by independent third-party insurance as
to which the insurer does not dispute coverage) as to any single or related
series of transactions, incidents or conditions, of $5,000,000 or more; or
(j) Unstayed or Unvacated Monetary Judgments. One or more
non-interlocutory judgments, non-interlocutory orders, decrees or
arbitration awards is entered against the Company or any Subsidiary
involving in the aggregate a liability (to the extent not covered by
independent third-party insurance as to which the insurer does not dispute
coverage) as to any single or related series of transactions, incidents or
conditions, of $1,000,000 or more, and the same shall remain unsatisfied,
unvacated and unstayed pending appeal for a period of 10 days after the
entry thereof; or
(k) Non-Monetary Judgments. Any non-monetary judgment, order
or decree is entered against the Company or any Subsidiary which does or
would reasonably be expected to have a Material Adverse Effect, and there
shall be any period of 30 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(l) Change of Control. There occurs any Change of Control; or
(m) Adverse Change. There occurs a Material Adverse Effect;
or
(n) Guarantor Defaults. Any Guarantor fails in any material
respect to perform or observe any term, covenant or agreement in the
Guaranty; or any Guaranty is for any reason partially (including with
respect to future advances) or wholly revoked or invalidated, or otherwise
ceases to be in full force and effect, or any Guarantor or any other Person
contests in any manner the validity or enforceability thereof or denies that
it has any further liability or obligation thereunder; or
(o) ▇▇▇▇▇. The occurrence and continuance of an "Event of
Default" as defined in the ▇▇▇▇▇ Service Agreement by ▇▇▇▇▇ or the Company
that would entitle (upon the granting of any necessary consents) the
Resource Recovery Development Authority for the City of Savannah or the
Trustee (as defined in the ▇▇▇▇▇ Service Agreement) to terminate the ▇▇▇▇▇
Service Agreement; or
(p) Purchase Agreement. Contico fails to make any indemnity
payments to or on behalf of the Company pursuant to the terms of the
Purchase Agreement, in an aggregate amount of more than $1,000,000 when due
and such failure continues after the applicable grace or notice period, if
any, specified in the Purchase Agreement.
9.2 Remedies.
If any Event of Default occurs, the Agent shall, at the request
of, or may, with the consent of, the Required Banks,
(a) declare the commitment of each Bank to make Loans and any
obligation of the Issuing Bank to Issue Letters of Credit to be terminated,
whereupon such commitments and obligation shall be terminated;
(b) declare an amount equal to the maximum aggregate amount
that is or at any time thereafter may become available for drawing under any
outstanding Letters of Credit (whether or not any beneficiary shall have
presented, or shall be entitled at such time to present, the drafts or other
documents required to draw under such Letters of Credit) to be immediately
due and payable, and declare the unpaid principal amount of all outstanding
Loans, all interest accrued and unpaid thereon, and all other amounts owing
or payable hereunder or under any other Loan Document to be immediately due
and payable, without presentment, demand, protest or other notice of any
kind, all of which are hereby expressly waived by the Company; and
(c) exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or
applicable law;
provided, however, that upon the occurrence of any event specified in
subsection (f) or (g) of Section 9.1 (in the case of clause (i) of
subsection (g) upon the expiration of the 60-day period mentioned therein),
the obligation of each Bank to make Loans and any obligation of the Issuing
Bank to Issue Letters of Credit shall automatically terminate and the unpaid
principal amount of all outstanding Loans and all interest and other amounts
as aforesaid shall automatically become due and payable without further act
of the Agent, the Issuing Bank or any Bank.
9.3 Rights Not Exclusive.
The rights provided for in this Agreement and the other Loan
Documents are cumulative and are not exclusive of any other rights, powers,
privileges or remedies provided by law or in equity, or under any other
instrument, document or agreement now existing or hereafter arising.
9.4 Certain Financial Covenant Defaults.
In the event that, after taking into account any extraordinary
charge to earnings taken or to be taken as of the end of any fiscal period
of the Company (a "Charge"), and if solely by virtue of such Charge, there
would exist an Event of Default due to the breach of any of Sections 8.18,
8.19, 8.20 or 8.21, as of such fiscal period end date, such Event of Default
shall be deemed to arise upon the earlier of (a) the date after such fiscal
period end date on which the Company announces publicly it will take, is
taking or has taken such Charge (including an announcement in the form of a
statement in a report filed with the SEC) or, if such announcement is made
prior to such fiscal period end date, the date that is such fiscal period
end date, and (b) the date the Company delivers to the Agent its audited
annual or unaudited quarterly financial statements in respect of such fiscal
period reflecting such Charge as taken.
ARTICLE X.
THE AGENT
10.1 Appointment and Authorization; "Agent".
(a) Each Bank hereby irrevocably (subject to Section 10.9)
appoints, designates and authorizes the Agent to take such action on its
behalf under the provisions of this Agreement and each other Loan Document
and to exercise such powers and perform such duties as are expressly
delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, the Agent shall not have any duties
or responsibilities, except those expressly set forth herein, nor shall the
Agent have or be deemed to have any fiduciary relationship with any Bank,
and no implied covenants, functions, responsibilities, duties, obligations
or liabilities shall be read into this Agreement or any other Loan Document
or otherwise exist against the Agent. Without limiting the generality of
the foregoing sentence, the use of the term "agent" in this Agreement with
reference to the Agent is not intended to connote any fiduciary or other
implied (or express) obligations arising under agency doctrine of any
applicable law. Instead, such term is used merely as a matter of market
custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.
(b) The Issuing Bank shall act on behalf of the Banks with
respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Agent may agree at
the request of the Required Banks to act for such Issuing Bank with respect
thereto; provided, however, that the Issuing Bank shall have all of the
benefits and immunities (i) provided to the Agent in this Article X with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit Issued by it or proposed to be Issued by
it and the application and agreements for letters of credit pertaining to
the Letters of Credit as fully as if the term "Agent", as used in this
Article X, included the Issuing Bank with respect to such acts or omissions,
and (ii) as additionally provided in this Agreement with respect to the
Issuing Bank.
10.2 Delegation of Duties.
The Agent may execute any of its duties under this Agreement or
any other Loan Document by or through agents, employees or attorneys-in-fact
and shall be entitled to advice of counsel concerning all matters pertaining
to such duties. The Agent shall not be responsible for the negligence or
misconduct of any agent or attorney-in-fact that it selects with reasonable
care.
10.3 Liability of Agent.
None of the Agent-Related Persons shall (i) be liable for any
action taken or omitted to be taken by any of them under or in connection
with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Banks for
any recital, statement, representation or warranty made by the Company or
any Subsidiary or Affiliate of the Company, or any officer thereof,
contained in this Agreement or in any other Loan Document, or in any
certificate, report, statement or other document referred to or provided for
in, or received by the Agent under or in connection with, this Agreement or
any other Loan Document, or the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document,
or for any failure of the Company or any other party to any Loan Document to
perform its obligations hereunder or thereunder. No Agent-Related Person
shall be under any obligation to any Bank to ascertain or to inquire as to
the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Company or any of the Company's
Subsidiaries or Affiliates.
10.4 Reliance by Agent.
(a) The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper
Person or Persons, and upon advice and statements of legal counsel
(including counsel to the Company), independent accountants and other
experts selected by the Agent. The Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other
Loan Document unless it shall first receive such advice or concurrence of
the Required Banks as it deems appropriate and, if it so requests, it shall
first be indemnified to its satisfaction by the Banks against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or
any other Loan Document in accordance with a request or consent of the
Required Banks and such request and any action taken or failure to act
pursuant thereto shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Sections 5.1 and 5.2, each Bank that has executed this
Agreement shall be deemed to have consented to, approved or accepted or to
be satisfied with, each document or other matter either sent by the Agent to
such Bank for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory
to the Bank.
10.5 Notice of Default.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default, except with respect to
defaults in the payment of principal, interest and fees required to be paid
to the Agent for the account of the Banks, unless the Agent shall have
received written notice from a Bank or the Company referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default." The Agent will notify the Banks of its
receipt of any such notice. The Agent shall take such action with respect
to such Default or Event of Default as may be requested by the Required
Banks in accordance with Article IX; provided, however, that unless and
until the Agent has received any such request, the Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable or in
the best interest of the Banks.
10.6 Credit Decision.
Each Bank acknowledges that none of the Agent-Related Persons
has made any representation or warranty to it, and that no act by the Agent
hereinafter taken, including any review of the affairs of the Company and
its Subsidiaries, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Bank. Each Bank represents to
the Agent that it has, independently and without reliance upon any Agent-
Related Person and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Company and its Subsidiaries, and all applicable
bank regulatory laws relating to the transactions contemplated hereby, and
made its own decision to enter into this Agreement and to extend credit to
the Company and its Subsidiaries hereunder. Each Bank also represents that
it will, independently and without reliance upon any Agent-Related Person
and based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit analysis, appraisals and decisions
in taking or not taking action under this Agreement and the other Loan
Documents, and to make such investigations as it deems necessary to inform
itself as to the business, prospects, operations, property, financial and
other condition and creditworthiness of the Company. Except for notices,
reports and other documents expressly herein required to be furnished to the
Banks by the Agent, the Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the
business, prospects, operations, property, financial and other condition or
creditworthiness of the Company which may come into the possession of any of
the Agent-Related Persons.
10.7 Indemnification of Agent.
Whether or not the transactions contemplated hereby are
consummated, the Banks shall indemnify upon demand the Agent-Related Persons
(to the extent not reimbursed by or on behalf of the Company and without
limiting the obligation of the Company to do so), pro rata, from and against
any and all Indemnified Liabilities; provided, however, that no Bank shall
be liable for the payment to the Agent-Related Persons of any portion of
such Indemnified Liabilities resulting solely from such Person's gross
negligence or willful misconduct. Without limitation of the foregoing, each
Bank shall reimburse the Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by the
Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect
of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the
extent that the Agent is not reimbursed for such expenses by or on behalf of
the Company. The undertaking in this Section shall survive the payment of
all Obligations hereunder and the resignation or replacement of the Agent.
10.8 Agent in Individual Capacity.
Bank of America and its Affiliates may make loans to, issue
letters of credit for the account of, accept deposits from, acquire equity
interests in and generally engage in any kind of banking, trust, financial
advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though Bank of America were not the Agent or
the Issuing Bank hereunder and without notice to or consent of the Banks.
The Banks acknowledge that, pursuant to such activities, Bank of America or
its Affiliates may receive information regarding the Company or its
Affiliates (including information that may be subject to confidentiality
obligations in favor of the Company or such Subsidiary) and acknowledge that
the Agent shall be under no obligation to provide such information to them.
With respect to its Loans, Bank of America shall have the same rights and
powers under this Agreement as any other Bank and may exercise the same as
though it were not the Agent or the Issuing Bank.
10.9 Successor Agent.
The Agent may, and at the request of the Required Banks shall,
resign as Agent upon 30 days' notice to the Banks. If the Agent resigns
under this Agreement, the Required Banks shall appoint from among the Banks
a successor administrative agent for the Banks which successor
administrative agent shall be approved by the Company unless an Event of
Default exists. If no successor administrative agent is appointed prior to
the effective date of the resignation of the Agent, the Agent may appoint,
after consulting with the Banks and the Company, a successor administrative
agent from among the Banks. Upon the acceptance of its appointment as
successor administrative agent hereunder, such successor administrative
agent shall succeed to all the rights, powers and duties of the retiring
Agent and the term "Agent" shall mean such successor administrative agent
and the retiring Agent's appointment, powers and duties as Agent shall be
terminated. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article X and Sections 11.4 and 11.5 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement. If no successor administrative agent has
accepted appointment as Agent by the date which is 30 days following a
retiring Agent's notice of resignation, the retiring Agent's resignation
shall nevertheless thereupon become effective and the Banks shall perform
all of the duties of the Agent hereunder until such time, if any, as the
Required Banks appoint a successor administrative agent as provided for
above. Notwithstanding the foregoing, however, Bank of America may not be
removed as the Agent at the request of the Required Banks unless Bank of
America shall also simultaneously be replaced as "Issuing Bank" hereunder
pursuant to documentation in form and substance reasonably satisfactory to
Bank of America.
10.10 Withholding Tax.
(a) If any Bank is a "foreign corporation, partnership or
trust" within the meaning of the Code, such Bank agrees with and in favor of
the Agent and the Company, to deliver to the Agent and the Company:
(i) if such Bank claims an exemption from, or a
reduction of, withholding tax under a United States tax treaty, two properly
completed and executed copies of IRS Form 1001 before the payment of any
interest in the first calendar year and before the payment of any interest
in each third succeeding calendar year during which interest may be paid
under this Agreement;
(ii) if such Bank claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such Bank,
two properly completed and executed copies of IRS Form 4224 before the
payment of any interest is due in the first taxable year of such Bank and in
each succeeding taxable year of such Bank during which interest may be paid
under this Agreement; and
(iii) such other form or forms as may be required under
the Code or other laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Such Bank agrees to promptly notify the Agent and the Company of any change
in circumstances which would modify or render invalid any claimed exemption
or reduction.
(b) If any Bank claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001
and such Bank sells, assigns, grants a participation in, or otherwise
transfers all or part of the Obligations of the Company to such Bank, such
Bank agrees to notify the Agent and the Company of the percentage amount in
which it is no longer the beneficial owner of Obligations of the Company to
such Bank. To the extent of such percentage amount, the Agent and the
Company will treat such Bank's IRS Form 1001 as no longer valid.
(c) If any Bank claiming exemption from United States
withholding tax by filing IRS Form 4224 with the Agent sells, assigns,
grants a participation in, or otherwise transfers all or part of the
Obligations of the Company to such Bank, such Bank agrees to undertake sole
responsibility for complying with the withholding tax requirements imposed
by Sections 1441 and 1442 of the Code.
(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent or the Company may withhold from any interest
payment to such Bank an amount equivalent to the applicable withholding tax
after taking into account such reduction. However, if the forms or other
documentation required by subsection (a) of this Section are not delivered
to the Agent or the Company, then the Agent or the Company may withhold from
any interest payment to such Bank not providing such forms or other
documentation an amount equivalent to the applicable withholding tax imposed
by Sections 1441 and 1442 of the Code, without reduction.
(e) If the IRS or any other Governmental Authority of the
United States or other jurisdiction asserts a claim that the Agent or the
Company did not properly withhold tax from amounts paid to or for the
account of any Bank (because the appropriate form was not delivered or was
not properly executed, or because such Bank failed to notify the Agent or
the Company of a change in circumstances which rendered the exemption from,
or reduction of, withholding tax ineffective, or for any other reason) such
Bank shall indemnify the Agent and the Company fully for all amounts paid,
directly or indirectly, by the Agent or the Company as tax or otherwise,
including penalties and interest, and including any taxes imposed by any
jurisdiction on the amounts payable to the Agent or the Company under this
Section, together with all costs and expenses (including Attorney Costs).
The obligation of the Banks under this subsection shall survive the payment
of all Obligations and the resignation or replacement of the Agent.
(f) For any period in which a Bank has failed to provide the
Agent and the Company with the appropriate form in accordance with
subsection 10.10(a), such Bank shall not be entitled to any payment, payment
increase, or indemnification under Section 4.1 with respect to Taxes imposed
by the United States; provided, however, that should a Bank that is
otherwise exempt from or subject to a reduced rate of withholding become
subject to Taxes because of its failure to deliver a form required
hereunder, the Company and the Agent shall take such steps as such Bank
shall reasonably request to assist such Bank to recover such Taxes.
10.11 Managing Agent, etc.
None of the Banks identified on the facing page or signature
pages of this Agreement as a "managing agent," "syndication agent" or "lead
arranger" shall have any right, power, obligation, liability, responsibility
or duty under this Agreement other than those applicable to all Banks as
such. Without limiting the foregoing, none of the Banks so identified as a
"managing agent," "syndication agent" or "lead arranger" shall have or be
deemed to have any fiduciary relationship with any Bank. Each Bank
acknowledges that it has not relied, and will not rely, on any of the Banks
so identified in deciding to enter into this Agreement or in taking or not
taking such action hereunder.
10.12 Release of Guaranty.
The Banks hereby authorize the Agent to release from time to
time any Subsidiary from its obligations under its Guaranty and to release
the stock of any Subsidiary held as collateral hereunder in connection with
the disposition of such Subsidiary in a transaction not prohibited
hereunder.
ARTICLE XI.
MISCELLANEOUS
11.1 Amendments and Waivers.
No amendment or waiver of any provision of this Agreement or any
other Loan Document, and no consent with respect to any departure by the
Company or any applicable Restricted Subsidiary therefrom, shall be
effective unless the same shall be in writing and signed by the Required
Banks (or by the Agent at the written request of the Required Banks) and the
Company and acknowledged by the Agent, and then any such waiver or consent
shall be effective only in the specific instance and for the specific
purpose for which given; provided, however, that no such waiver, amendment,
or consent shall, unless in writing and signed by all the Banks and the
Company and acknowledged by the Agent, do any of the following:
(a) increase or extend the Commitment of any Bank (or
reinstate any such Commitment terminated pursuant to Section 9.2);
(b) postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of principal, interest, fees or other
amounts due to the Banks (or any of them) hereunder or under any other Loan
Document, including prepayments specified in Section 2.7, or reduce the
amount due to the Banks (or any of them) on any such date;
(c) reduce the principal of, or the rate of interest specified
herein on any Loan, or (subject to clause (iii) below) any fees or other
amounts payable hereunder or under any other Loan Document;
(d) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans which is required for the
Banks or any of them to take any action hereunder; or
(e) amend this Section, or Section 2.14, or any provision
herein providing for consent or other action by all Banks;
and, provided further, that (i) no amendment, waiver or consent shall,
unless in writing and signed by the Issuing Bank in addition to the Required
Banks or all the Banks, as the case may be, affect the rights or duties of
the Issuing Bank under this Agreement or any L/C-Related Document relating
to any Letter of Credit Issued or to be Issued by it, (ii) no amendment,
waiver or consent shall, unless in writing and signed by the Agent in
addition to the Required Banks or all the Banks, as the case may be, affect
the rights or duties of the Agent under this Agreement or any other Loan
Document, and (iii) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed by the parties thereto.
11.2 Notices.
(a) All notices, requests, consents, approvals, waivers and
other communications shall be in writing (including, unless the context
expressly otherwise provides, by facsimile transmission, provided that any
matter transmitted by the Company by facsimile (i) shall be immediately
confirmed by a telephone call to the recipient at the number specified on
Schedule 11.2, and (ii) shall be followed promptly by delivery of a hard
copy original thereof) and mailed, faxed or delivered, to the address or
facsimile number specified for notices on Schedule 11.2; or, as directed to
the Company or the Agent, to such other address as shall be designated by
such party in a written notice to the other parties, and as directed to any
other party, at such other address as shall be designated by such party in a
written notice to the Company and the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the
date deposited into the U.S. mail, or if delivered, upon delivery; except
that notices pursuant to Articles II, III or X to the Agent shall not be
effective until actually received by the Agent, and notices pursuant to
Article III to the Issuing Bank shall not be effective until actually
received by the Issuing Bank at the address specified for the "Issuing Bank"
on the applicable signature page hereof.
(c) Any agreement of the Agent and the Banks herein to receive
certain notices by telephone or facsimile is solely for the convenience and
at the request of the Company. The Agent and the Banks shall be entitled to
rely on the authority of any Person purporting to be a Person authorized by
the Company to give such notice and the Agent and the Banks shall not have
any liability to the Company or other Person on account of any action taken
or not taken by the Agent or the Banks in reliance upon such telephonic or
facsimile notice. The obligation of the Company to repay the Loans and L/C
Obligations shall not be affected in any way or to any extent by any failure
by the Agent and the Banks to receive written confirmation of any telephonic
or facsimile notice or the receipt by the Agent and the Banks of a
confirmation which is at variance with the terms understood by the Agent and
the Banks to be contained in the telephonic or facsimile notice.
11.3 No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part
of the Agent or any Bank, any right, remedy, power or privilege hereunder,
shall operate as a waiver thereof; nor shall any single or partial exercise
of any right, remedy, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, remedy, power
or privilege.
11.4 Costs and Expenses.
The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse Bank of America (including in its capacity as
Agent and Issuing Bank) within five Business Days after demand (subject to
subsection 5.1(e)) for all costs and expenses incurred by Bank of America
(including in its capacity as Agent and Issuing Bank) in connection with the
development, preparation, delivery, administration and execution of, and any
amendment, supplement, waiver or modification to (in each case, whether or
not consummated), this Agreement, any Loan Document and any other documents
prepared in connection herewith or therewith, and the consummation of the
transactions contemplated hereby and thereby, including reasonable Attorney
Costs incurred by Bank of America (including in its capacity as Agent and
Issuing Bank) and any Bank with respect thereto; and
(b) pay or reimburse the Agent, ▇▇▇▇▇▇▇▇▇▇ and each Bank
within five Business Days after demand (subject to subsection 5.1(e)) for
all costs and expenses (including Attorney Costs) incurred by them in
connection with the enforcement, attempted enforcement, or preservation of
any rights or remedies under this Agreement or any other Loan Document
during the existence of an Event of Default or after acceleration of the
Loans (including in connection with any "workout" or restructuring regarding
the Loans, and including in any Insolvency Proceeding or appellate
proceeding).
11.5 Company Indemnification.
Whether or not the transactions contemplated hereby are
consummated, the Company shall indemnify, defend and hold the Agent-Related
Persons, and each Bank and each of its respective officers, directors,
employees, counsel, agents and attorneys-in-fact (each, an "Indemnified
Person") harmless from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, charges,
expenses and disbursements (including reasonable Attorney Costs) of any kind
or nature whatsoever which may at any time (including at any time following
repayment of the Loans, the termination of the Letters of Credit and the
termination, resignation or replacement of the Agent or replacement of any
Bank) be imposed on, incurred by or asserted against any such Person in any
way relating to or arising out of this Agreement, the Existing Credit
Agreement, or any document contemplated by or referred to herein, or the
transactions contemplated hereby, or any action taken or omitted by any such
Person under or in connection with any of the foregoing, including with
respect to any investigation, litigation or proceeding (including any
Insolvency Proceeding or appellate proceeding) related to or arising out of
this Agreement, the Existing Credit Agreement, or the Loans or Letters of
Credit or the use of the proceeds thereof, whether or not any Indemnified
Person is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided, that the Company shall have no obligation hereunder
to any Indemnified Person with respect to Indemnified Liabilities resulting
solely from the gross negligence or willful misconduct of such Indemnified
Person. The agreements in this Section shall survive payment of all other
Obligations.
11.6 Payments Set Aside.
To the extent that the Company makes a payment to the Agent or
the Banks, or the Agent or the Banks exercise their right of set-off, and
such payment or the proceeds of such set-off or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Bank in its discretion) to be repaid to a trustee, receiver or
any other party, in connection with any Insolvency Proceeding or otherwise,
then (a) to the extent of such recovery the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full
force and effect as if such payment had not been made or such set-off had
not occurred, and (b) each Bank severally agrees to pay to the Agent upon
demand its pro rata share of any amount so recovered from or repaid by the
Agent.
11.7 Successors and Assigns.
The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
assigns, except that the Company may not assign or transfer any of its
rights or obligations under this Agreement without the prior written consent
of the Agent and each Bank.
11.8 Assignments, Participations, etc.
(a) Any Bank may, with the written consent of the Company at
all times other than during the existence of an Event of Default and the
Agent and the Issuing Bank, which consent of the Company shall not be
unreasonably withheld, at any time assign and delegate to one or more
Eligible Assignees (provided that no written consent of the Company, the
Agent or the Issuing Bank shall be required in connection with any
assignment and delegation by a Bank to an Eligible Assignee that is an
Affiliate of such Bank) (each an "Assignee") all, or any ratable part of
all, of the Loans, the Commitments, the L/C Obligations and the other rights
and obligations of such Bank hereunder, in a minimum amount of the Minimum
Assignment Amount (as defined below); provided, however, that (1) such
assignment shall be null and void if not undertaken on a pro rata basis
between Facility A Loans and Commitments and Facility B Loans and
Commitments, and (2) the Company and the Agent may continue to deal solely
and directly with such Bank in connection with the interest so assigned to
an Assignee until (i) written notice of such assignment, together with
payment instructions, addresses and related information with respect to the
Assignee, shall have been given to the Company and the Agent by such Bank
and the Assignee; (ii) such Bank and its Assignee shall have delivered to
the Company and the Agent an Assignment and Acceptance in the form of
Exhibit E ("Assignment and Acceptance") together with any Note or Notes
subject to such assignment and (iii) the assignor Bank or Assignee has paid
to the Agent a processing fee in the amount of $3,500. The phrase "Minimum
Assignment Amount" shall mean, the lesser of (x) $10,000,000, unless the
Acquisition Loans are not funded by on or before February 26, 1999, in which
case, $5,000,000, and (y) the assigning Bank's remaining combined
Commitments hereunder.
(b) From and after the date that the Agent notifies the
assignor Bank that it has received (and provided its consent with respect
to) an executed Assignment and Acceptance and payment of the above-
referenced processing fee, (i) the Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, shall have the
rights and obligations of a Bank under the Loan Documents, and (ii) the
assignor Bank shall, to the extent that rights and obligations hereunder and
under the other Loan Documents have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Loan Documents.
(c) Promptly after its receipt of notice by the Agent that it
has received an executed Assignment and Acceptance and payment of the
processing fee, (and provided that it consents to such assignment in
accordance with subsection 11.8(a)), the Company shall execute and deliver
to the Agent, if Notes have been made, new Notes evidencing such Assignee's
assigned Loans and Commitment and, if the assignor Bank has retained a
portion of its Loans and its Commitment, replacement Notes in the principal
amount of the Loans retained by the assignor Bank (such Notes to be in
exchange for, but not in payment of, the Notes held by such Bank).
Immediately upon each Assignee's making its processing fee payment under the
Assignment and Acceptance, this Agreement shall be deemed to be amended to
the extent, but only to the extent, necessary to reflect the addition of the
Assignee and the resulting adjustment of the Commitments arising therefrom.
The Commitment allocated to each Assignee shall reduce such Commitments of
the assigning Bank pro tanto.
(d) Any Bank may at any time sell to one or more commercial
banks or other Persons not Affiliates of the Company (a "Participant")
participating interests in any Loans, the Commitment of that Bank and the
other interests of that Bank (the "originating Bank") hereunder and under
the other Loan Documents; provided, however, that (i) such participation
shall be null and void if not undertaken on a pro rata basis between
Facility A Loans and Commitments and Facility B Loans and Commitments,
(ii) the originating Bank's obligations under this Agreement shall remain
unchanged, (iii) the originating Bank shall remain solely responsible for
the performance of such obligations, (iv) the Company, the Issuing Bank and
the Agent shall continue to deal solely and directly with the originating
Bank in connection with the originating Bank's rights and obligations under
this Agreement and the other Loan Documents, and (v) no Bank shall transfer
or grant any participating interest under which the Participant has rights
to approve any amendment to, or any consent or waiver with respect to, this
Agreement or any other Loan Document, except to the extent such amendment,
consent or waiver would require unanimous consent of the Banks as described
in the first proviso to Section 11.1. In the case of any such participation,
the Participant shall be entitled to the benefit of Sections 4.1, 4.3 and
11.5 as though it were also a Bank hereunder, and not have any rights under
this Agreement, or any of the other Loan Documents, and all amounts payable
by the Company hereunder shall be determined as if such Bank had not sold
such participation; except that, if amounts outstanding under this Agreement
are due and unpaid, or shall have been declared or shall have become due and
payable upon the occurrence of an Event of Default, each Participant shall
be deemed to have the right of set-off in respect of its participating
interest in amounts owing under this Agreement to the same extent as if the
amount of its participating interest were owing directly to it as a Bank
under this Agreement.
(e) Notwithstanding any other provision in this Agreement, any
Bank may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement and the Note held
by it, if any, in favor of any Federal Reserve Bank in accordance with
Regulation A of the FRB or U.S. Treasury Regulation 31 CFR 203.14, and such
Federal Reserve Bank may enforce such pledge or security interest in any
manner permitted under applicable law.
11.9 Confidentiality.
Each Bank agrees to take and to cause its Affiliates to take
normal and reasonable precautions and exercise due care to maintain the
confidentiality of all information provided to it by the Company or any
Subsidiary, or by the Agent on the Company's or such Subsidiary's behalf,
under this Agreement or any other Loan Document, and neither it nor any of
its Affiliates shall use any such information other than in connection with
or in enforcement of this Agreement and the other Loan Documents or in
connection with other business now or hereafter existing or contemplated
with the Company or any Subsidiary; except to the extent such information
(i) was or becomes generally available to the public other than as a result
of disclosure by the Bank, or (ii) was or becomes available on a non-
confidential basis from a source other than the Company, provided that such
source is not bound by a confidentiality agreement with the Company known to
the Bank; provided, however, that any Bank may disclose such information (A)
at the request or pursuant to any requirement of any Governmental Authority
to which the Bank is subject or in connection with an examination of such
Bank by any such authority; (B) pursuant to subpoena or other court process;
(C) when required to do so in accordance with the provisions of any
applicable Requirement of Law; (D) to the extent reasonably required in
connection with any litigation or proceeding to which the Agent, any Bank or
their respective Affiliates may be party; (E) to the extent reasonably
required in connection with the exercise of any remedy hereunder or under
any other Loan Document; (F) to such Bank's independent auditors and other
professional advisors; (G) to any Participant or Assignee, actual or
potential, provided that such Person agrees in writing to keep such
information confidential to the same extent required of the Banks hereunder;
(H) as to any Bank or its Affiliate, as expressly permitted under the terms
of any other document or agreement regarding confidentiality to which the
Company or any Subsidiary is party or is deemed party with such Bank or such
Affiliate; and (I) to its Affiliates.
11.10 Set-off.
In addition to any rights and remedies of the Banks provided by
law, if an Event of Default exists or the Loans have been accelerated, each
Bank is authorized at any time and from time to time, without prior notice
to the Company, any such notice being waived by the Company to the fullest
extent permitted by law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held by, and
other indebtedness at any time owing by, such Bank to or for the credit or
the account of the Company against any and all Obligations owing to such
Bank, now or hereafter existing, irrespective of whether or not the Agent or
such Bank shall have made demand under this Agreement or any Loan Document
and although such Obligations may be contingent or unmatured. Each Bank
agrees promptly to notify the Company and the Agent after any such set-off
and application made by such Bank; provided, however, that the failure to
give such notice shall not affect the validity of such set-off and
application.
11.11 Automatic Debits of Fees.
With respect to any facility fee, arrangement fee, letter of
credit fee or other fee, or any other cost or expense (including Attorney
Costs) due and payable to the Agent, the Issuing Bank, Bank of America or
Montgomery under the Loan Documents, the Company hereby irrevocably
authorizes Bank of America to debit any deposit account of the Company with
Bank of America in an amount such that the aggregate amount debited from all
such deposit accounts does not exceed such fee or other cost or expense. If
there are insufficient funds in such deposit accounts to cover the amount of
the fee or other cost or expense then due, such debits will be reversed (in
whole or in part, in Bank of America's sole discretion) and such amount not
debited shall be deemed to be unpaid. No such debit under this
Section shall be deemed a set-off.
11.12 Notification of Addresses, Lending Offices, Etc.
Each Bank shall notify the Agent in writing of any changes in
the address to which notices to the Bank should be directed, of addresses of
any Lending Office, of payment instructions in respect of all payments to be
made to it hereunder and of such other administrative information as the
Agent shall reasonably request.
11.13 Counterparts.
This Agreement may be executed in any number of separate
counterparts, each of which, when so executed, shall be deemed an original,
and all of said counterparts taken together shall be deemed to constitute
but one and the same instrument.
11.14 Severability.
The illegality or unenforceability of any provision of this
Agreement or any instrument or agreement required hereunder shall not in any
way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required
hereunder.
11.15 No Third Parties Benefited.
This Agreement is made and entered into for the sole protection
and legal benefit of the Company, the Banks, the Agent and the Agent-Related
Persons, and their permitted successors and assigns, and no other Person
shall be a direct or indirect legal beneficiary of, or have any direct or
indirect cause of action or claim in connection with, this Agreement or any
of the other Loan Documents.
11.16 Governing Law and Jurisdiction.
(a) THIS AGREEMENT AND ANY NOTES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA; PROVIDED
THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL
LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF
CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE
COMPANY, THE AGENT AND THE BANKS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE
COMPANY, THE AGENT AND THE BANKS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY
DOCUMENT RELATED HERETO. THE COMPANY, THE AGENT AND THE BANKS EACH WAIVE
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE
MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW.
11.17 Waiver of Jury Trial.
THE COMPANY, THE BANKS AND THE AGENT EACH WAIVE THEIR RESPECTIVE
RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING
OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY
OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY,
THE BANKS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION
SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE
FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL
BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO
CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS.
11.18 Entire Agreement.
This Agreement, together with the other Loan Documents, embodies
the entire agreement and understanding among the Company, the Banks and the
Agent, and supersedes all prior or contemporaneous agreements and
understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof, except that the representations and warranties
(as of the dates made and deemed made) and the indemnities of the Company
set forth in the Existing Credit Agreement and the "Loan Documents" as
defined therein shall, in each case, survive the execution and delivery of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly
authorized officers as of the day and year first above written.
KATY INDUSTRIES, INC.
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President of Finance and
Chief Financial Officer
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent, Issuing
Bank, and a Bank
By: /S/ ▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
LASALLE NATIONAL BANK, as Managing Agent
and a Bank
By: /S/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Group - Senior Vice President
KEYBANK NATIONAL ASSOCIATION, as a Bank
By: /S/ ▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President
MERCANTILE BANK NATIONAL ASSOCIATION, as
a Bank
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
THE NORTHERN TRUST COMPANY, as a Bank
By: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇ Anwar
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇ Anwar
Title: Vice President
NORWEST BANK COLORADO NATIONAL
ASSOCIATION, as a Bank
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
SOCIETE GENERALE, as a Bank
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
UNION BANK OF CALIFORNIA, N.A., as a
Bank
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Vice President
UNION PLANTERS BANK, N.A., as a Bank
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION, as a
Bank
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President